Your Prescription for a Healthy Retirement

1. Your Prescription for a Healthy Retirement 2009 Health Care Choices for BorgWarner Muncie Salaried Retirees

2. Today’s Agenda • Recap of what’s changing • Muncie Salaried & Non-Muncie Retirees • Pre-Medicare information • BorgWarner pre-Medicare benefits • Preview of BorgWarner post-65 benefits • Next steps for pre-65 retirees • Medicare information • Introduction to UnitedHealthCare • Medicare options education • Next steps for Medicare retirees

3. Icons to Help You = Important concept = Decision-support tools = Alerts you on “to do” items www.BorgWarner.com/retirees

4. Recap of What’s Changing & Why • BorgWarner has NOT eliminated your coverage; it’s being delivered differently • Coverage is more flexible; choose individual coverage that meets your health care needs • Plans can vary for you and your dependents • More choice and better options for coverage are now available to retirees over 65 • United HealthCare’s role in helping you choose • Tax-free reimbursement accounts • Retiree Reimbursement Accounts (RRA)

5. Recap of What’s Changingon 1/1/09 IF YOU ARE UNDERAGE 65 IF YOU AREMEDICARE ELIGIBLE Continue BorgWarner medical and Rx coverage until Medicare eligible If retired with 25 years of service or more: You pay 10% BorgWarner pays 90% If retired with less than 25 years of service: You pay 15% BorgWarner pays 85% Medicare continues to be your primary coverage Your BorgWarner supplemental coverage ends. The company sets up a Retiree Reimbursement Account (RRA) United HealthCare, our Retiree Plan Coordinator, is available to help you assess, select and enroll in the Medicare Supplement plan that is right for you. The retiree’s benefit is based on the retiree’s age. The dependent’s benefit is based on dependent’s age. Plans are individual, not by household.

6. Borg Warner Pre-MedicareCoverage

7. Retiree Pre-MedicareCoverage - Muncie If you or your dependents are not eligible for Medicare… • You remain on a BorgWarner pre-Medicare health care plan until Medicare-eligible • Anthem is your plan administrator if Muncie Retiree • CIGNA is your plan administrator if non-Muncie Retiree • You will be required to complete a 2009 enrollment form during 4th quarter 2008 • If your prescription drug coverage is currently with Express Scripts, it will move to CIGNA • Anthem Pharmacy stays with Anthem – no changes • Health Plan questions should be directed to: • First to Anthem or CIGNA • See Your Wallet Card

8. Retiree Pre-MedicareCoverage - BorgWarner Compared to 41% average *assumes 5% trend on 2007 BW PreMedicare Plan experience

9. Retiree Pre-Medicare Coverage - Muncie Plan details will be mailed to you during open enrollment

10. Retiree Pre-Medicare Rx Coverage - Muncie Retail Drug Stores / Anthem Mail Order Same as current coverage Plan details will be mailed to you during open enrollment *CIGNA max $150, $50, $100

11. Retiree Pre-Medicare Rx Coverage - Muncie BorgWarner Family Pharmacy Muncie Retirees - Same as current coverage Plan details will be mailed to you during open enrollment

12. When you turn age 65… PREMEDICARE MEDICARE Age • New RRA from BW helps pay for Medicare supplement coverage • BW provides United HealthCare as a Retiree Health Care Coordinator to help you choose medical/Rx coverage and enroll Before Medicare Eligibility – BW medical & Rx coverage Age 65 or Disability – BW coverage ends

13. Next Steps (For Pre-65)

14. Rx for a Healthy Retirement www.BorgWarner.com/retirees Pre-Medicare QUESTIONS? ?

15. Prescription for a Healthy Retirement: PART 2 MedicarePart B MedicarePart C MedicarePart A MedicarePart D Medicare-Eligible Retirees RetireeReimbursementAccount Pre-MedicareCoverage Medigap August 2008

16. Introducing UnitedHealthcare Private Insurance Provider of Medicare Products • Offers you Medicare Advantage (Part C), Rx (Part D) and Medigap Plan Options • Similar to other leading providers such as CIGNA, BlueCross BlueShield, AETNA, and Humana Retiree Health Plan Coordinator • Access to call center and website • Expert guidance to help you choose Medicare Supplement Plan that’s right for you RRA Administrator • Manages the Retiree Reimbursement Account (RRA)

17. RetireeReimbursementAccount

18. Retiree Reimbursement Account For Medicare-eligible employees, spouses and dependents

19. Retiree Reimbursement Account For Medicare-eligible employees, spouses and dependents

20. Your RRA Account If you have questions about your RRA, you can call the RRA Financial Call Center at 866-214-5385

21. Using Your RRA Account BorgWarner credits your account monthly You send your receipt and claim form to UHC You pay premiums* and out-of-pocket medical expenses You receive reimbursement * If you choose UHC insurance, premiums will be deducted directly from your RRA

22. Retiree Health Coordinator: Needs Assessment United HealthCare helps you choose the best Retiree Health Plan for you How frequently do you access care? Are you comfortable with using a network provider? Are there specific doctors that need to be in the network? Would you prefer complete freedom in selection of the doctors you see? Do you travel frequently and/or internationally? Are you looking for a plan that is very similar to your current coverage? Or, are you more interested in lower monthly payments with predictable copayments? What specific medications you are taking to verify coverage under our plan? Do you live in a different state for part of the year?

23. Medicare Plan Options

24. What Do Medicare Plans Cost? Individual Alternatives for Post-65 Health Coverage AARP Medicare Supplement Opt Out/No Coverage RX- “D” Medicare Advantage “Part C Plan” Monthly Health Care Cost Continuum

25. Medicare Part A • Automatic enrollment when you apply for Social Security • Provides help with the cost of hospital stays • Some skilled nursing services and care

26. Medicare Part B – 2008 Medicare Part B Overview: • $135 deductible • 80%/20% coinsurance • Enrollment window • 3 months prior to birthday month thru 3 months after birthday month Be sure to be in Part B!

27. Medicare Part B – 2008 The Part B premium is determined by an income test

28. Part C Plans – Advantage Plans • Many Options offered by private insurers… • Health Maintenance Organization Plans (HMOs) • Preferred Provider Organization Plans (PPOs) • Special Needs Plans (SNP) • Private Fee for Service Plans (PFFS) • Annual enrollment period • Replaces Medicare A&B • Must be enrolled in A&B to get Part C Plan

29. A Closer Look at HMO and PPO Plans HMO-type plans • Network of doctors and hospitals • Primary care physician • Some plans include prescription drug coverage and additional benefits PPO-type plans • Have more freedom to choose • Use network of doctors and hospitals to receive the maximum benefit • Outside the network a higher cost • Some plans include prescription drug coverage and additional benefits

30. Coordinated Care Plans Special Needs Plans Designed for people with special health care needs Residents of nursing homes People eligible for both Medicare and Medicaid People with certain chronic diseases such as diabetes or heart disease Focus on helping members receive more coordinated care Holistic, proactive approach Specialized care team Enhanced education and communication CARE TEAM

31. Private-Fee-For-Service Plans • Offered by private insurance companies • No restrictions on which doctors or hospitals you can use EXCEPT • Doctors and hospitals must accept the terms, conditions and payment rates of the private insurance company • Payment comes from the private fee-for-service plan not Medicare • Important to make sure your doctor or hospital will accept terms, conditions and payment rates from a specific plan each time you receive services • Many plans may offer prescription drug coverage • Many plans may offer additional benefits beyond traditional Medicare Parts A & B

32. Medicare Advantage Plan Scenario #1 “Good Health” Hank – Age 67 – Illinois • Generally in good health • Takes 1 generic prescription drug each month, via mail order • No hospitalizations • 4 primary care office visits per year • 2 specialist office visits per year

33. Medicare Advantage Plan Scenario #2 “Moderate” Mildred, Age 81, Central New York • Takes 2 generic drugs and 1 preferred brand-name drug each month, via mail order • 1 hospital stay, length of 3 days • 3 primary care office visits per year • 8 specialist office visits per year

34. Medicare Advantage Plan Scenario #3 “Chronic Condition” Carol, Age 66, Michigan • Takes 5 generic drugs and 2 preferred brand-name drugs each month, via mail order • 2 hospital stays, total of 5 days • 12 primary care office visits per year • 10 specialist office visits per year

35. Medicare Advantage Plan Scenario #4 “Specialty Drug” Sam, Age 69, Florida • Takes 2 generic drugs at retail, plus 1 non-preferred specialty drug • 1 hospital stay, length of 3 days • 12 primary care office visits per year • 5 specialist office visits per year

36. Medigap

37. AARP Medigap Options 2008 AARP MEDICARE SUPPLEMENT PORTFOLIO 1] $4,440 maximum out of pocket, indexed to Medicare costs [2] $2,220 maximum out of pocket, indexed to Medicare costs X = Covered in Full The above rates are monthly premium 2008 national weighted averages “Best Seller/Value”

38. AARP Medigap Options Enrollment Into Medigap • When turn 65 AND enroll in Medicare B, guaranteed right to buy a Medigap policy for next six months. • Miss window, you can apply at later date but risk rejection for health history or paying a higher premium

39. Medigap Plan Scenario #1 “Good Health” Hank – Age 67 – Illinois • Takes 1 generic prescription drug each month, via mail order • No hospitalizations • 4 primary care office visits per year • 2 specialist office visits per year

40. Medigap Plan Scenario #2 “Moderate” Mildred, Age 81, Central New York • Takes 2 generic drugs and 1 preferred brand-name drug each month, via mail order • 1 hospital stay, length of 3 days • 3 primary care office visits per year & 8 specialist office visits per year

41. Medigap Plan Scenario #3 “Chronic Condition” Carol, Age 66, Michigan • Multiple chronic illnesses • Takes 5 generic drugs and 2 preferred brand-name drugs each month, via mail order • 2 hospital stays, total of 5 days • 12 primary care office visits per year & 10 specialist office visits per year

42. Medigap Plan Scenario #4 “Specialty Drug” Sam, Age 69, Florida • Takes 2 generic drugs at retail, plus 1 non-preferred specialty drug • 1 hospital stay, length of 3 days • 12 primary care office visits per year • 5 specialist office visits per year

43. MedicarePart D

44. Sample AARP MedicareRx Preferred – 2008 Part D Plan Ideal for 70%+ of BorgWarner seniors… Great deal! • Benefits shown above apply until the total cost (paid by you and the Plan) of prescriptions received reaches $2,510 in eligible expenses. You will be responsible for 100% of the cost until your out of pocket expenses reach $4,050. • Catastrophic coverage in accordance with Medicare regulations. * Mail Order – up to 90 day supply; members may also obtain a 90 day supply at network retail pharmacies for the same copayment

45. AARP MedicareRx Plan Offers A Broad Formulary • 99% of Part D allowable drugs are in our current formulary structure • Drug exclusions include: • Drugs ending in “am” used to treat anxiety   • Alprazolam • Clonazepam • Erectile dysfunction drugs  • Folic acid • Cough/cold symptom relievers

46. AARP MedicareRx Plan How does it work at the pharmacy? • Brand preferred drug costs $75 • You pay $30 copay • Plan pays $45 • $75 applies toward the $2510 • Brand non-preferred drug costs $150 • You pay $75.40 copay • Plan pays $74.60 • $150 applies toward the $2510 • Generic drug costs $15 • You pay $7 copay • Plan pays $8 • $15 applies toward the $2,510 Full cost of the Rx counts toward $2,510

47. RX Coverage – Donut Hole Example Cost Sharing “Donut Hole” Catastrophic Plan Pays You Pay 100% Plan Pays 95% $2,510 $4,050 + = You Pay You Pay

48. Choosing Rx Coverage • Annual enrollment period • Comparing Prescription Drug options is complicated • Use calculator at www.medicare.gov • Talk with UHC • Comparison-shop • Be sure you understand how the prescription drug plan you select works! • If considering a Medicare Advantage (Part C) plan that includes both medical & Rx coverage, you may not need a Part D plan – so consider it when comparison-shopping

49. Special Note about Rx • Be sure you arrange for prescription drug coverage for 2009 – enrollment is not automatic! • Medicare Part C – Medicare Advantage Plan – with “built in” prescription drug coverage; or • Part D (AARP MedicareRx Preferred) • If you don’t enroll for 2009, you’ll generally have to pay a higher premium to receive coverage in future years You need new Rx coverage for 2009! BW Rx coverage 12/31/08 – BW coverage ends

50. Your Retiree Health Plan Coordinator • United HealthCare can provide expert guidance to help you choose and enroll in the health plan that is right for you • Knowledgeable representatives who understand retirees and retiree health care choices • No cost – you do not receive a discount or pay extra in premium for plans selected with the help of a Coordinator • Reach by phone or Web • 1-800-929-2300 • www.aarpmedicaresolutions.com Remember, at the very least, enroll in Part B, and Part D or a Medigap Plan before 12/31/08!