2013 National Postal Forum San Francisco, California GSA and Addressing (Rules and Recommendations)

1. Adam Collinson Director of Research & Development GrayHair Software, Inc. Derrick Miliner Mail Management Policy U.S. General Services Administration 2013 National Postal ForumSan Francisco, California GSA and Addressing (Rules and Recommendations) Angela Lawson Manager – Address Technology United States Postal Service®

2. Undeliverable as Addressed (UAA)Mail USPS® 2011/2012: Mail Volume:168/160 Billion UAA Volume: 7.02/6.76 Billion (4.18%/4.23%) UAA Cost: $1.315 / $1.318 Billion Mailing Industry: Postage: 2% required to cover cost of Returns Business: $7+ Billion Costs* $20+ Billion Business Impact Top UAA Reasons: 75.8% Move-Related 12.5% Address-Related What Can You Do: Implement a comprehensive Address Quality Strategy Use ALL applicable addressing products & services Track your mail channel’s R.O.I. * Based on DMA per piece cost estimates

3. a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS®-approved methods. … d. Except for mail bearing an alternative address format, addresses used on pieces of Standard Mail or pieces claiming First-Class Mail Presorted rates, regardless of any required surcharge, must meet the Move Update standard. Move Update – RequirementFor all Standard Mail®and Discounted First-Class Mail®

4. Legal Restraint Method Mailers who claim they are restricted by law from incorporating Postal Service COA information into their mailing lists without permission from addressees may request NCSC approval to meet their Move Update requirements using the Legal Restraint method. Unless the mailer is a federal, state, or local government entity, the request for approval must include a citation and copies of the applicable legal statutes or regulations. Federal, state, and local government entities must request approval, but they do not have to submit citations. Mailers wishing to use the Legal Restraint method must follow steps 1 through 5 below: ReceiveCOA informationusing one of the USPS primary methods within 95 days before the mailing. For each address identified as a COA, contact the addressee within 30 days to request confirmation. Incorporated responses into the list within 30 days of receipt from the customer. Keep documentation of the process described in steps 1 to 3 for two years. Provide documentation to the Postal Service® upon request. Move Update – Alternative Method – Legal Restraint

5. Telecommunications A street address is required by Federal law to provide a geographic location for each wireless device that can be associated with the state, county, or city for tax purposes. In order to comply with the Mobile Telecommunications Sourcing Act (MTSA) of 2002, a Telcom is required to capture and maintain a Place of Primary Use (PPU) address for all of its customers. PPU is defined as a valid street (physical) address within the defined licensed service area for the customer's home market. This address is used only for taxation purposes, not to determine if a customer can have an out-of-market secondary/additional line. In addition, the street address is used to reduce the risk of identity theft and fraud. Credit and Activations policy is to run credit only on a physical address. Customers can provide a post office box for their mailing address, but not for billing or place of primary use. A post office box may be entered after the activation process has been approved. The billing ZIP Code™ provided needs to match the ZIP Code on the credit card. Credit and Activations policy matches the billing ZIP™ with the ZIP on the credit card as a way to reduce the risk of identity theft and fraud.

6. Financial Industry • Under the Business Security Act (BSA), as amended by the Patriot Act, every financial institution must implement a written Customer Identification Program (CIP) to prevent financing of terrorist operations and money laundering. • The CIP Rules establish the minimum identification information a financial institution must collect before opening a new account. Four data items are required for all new accounts: • Name • Date of birth (for an individual) • Address • Identification number. • The CIP Rule requires a physical address because “…law enforcement agencies should be able to contact an individual customer at a physical location, rather than solely through a mailing address.” • Can be either a home or business address. The only exception is for Army Post Office boxes (APO) or Fleet Post Office (FPO). • A Commercial Mail Receiving Agency (CMRA) address is not allowed as the only address for new accounts opened after October 1, 2003.

7. GSA: U.S. General Services Administration Federal Management Regulation (effective December 08, 2011) • Subpart F—Agency Mail Manager Requirements • §102-192.130—What are your general responsibilities as an agency mail manager? • (b) Ensure agency-wide awareness and compliance with standards and operational procedures established by all service providers used by the agency • (d) Seek opportunities to implement cost-effective improvements and to enhance performance of the agency’s mission • Subpart G—Mail Center Manager Requirements • §102-192.140—What are your general responsibilities as a Federal mail center manager? • (d) Ensure that all addresses on mailing lists have been validated using USPS®-approved tools such as ancillary endorsements, CASS Certified™ software, Move Update, and NCOALink® • (e) Keep current on new technologies that could be applied to reduce agency mailing costs

8. HIPAA Health Insurance Portability and Accountability Act • Beginning Jan. 1, 2012, all HIPAA-standard electronic transactions submitted by a covered entity must be exchanged using the new ANSI v5010 standards. • "The Billing Provider Address must be a street address." • "P.O. Box or Lock Box addresses are to be sent in the Pay-to Address Loop (Loop ID-2010AB), if necessary." • This change applies to all claim formats, i.e., Dental, Institutional and Professional. • Electronic claims under ANSI v4010A1 submitted with a P.O. Box or Lock Box in the Billing Provider Address, Loop 2010AA, Segment N3 will receive the Warning (W) message(s) listed below: • Message ID QCA – (Addr 1 – P.O. Box Not Allowed in ANSI v5010) • Message ID QCB – (Addr 2 – P.O. Box Not Allowed in ANSI v5010) • Under ANSI v5010, electronic claims submitted with the P.O. Box or Lock Box instead of a physical address for the Billing Provider Address will cause the claim to reject.

9. Medicare Prescription Drug Benefit Manual Chapter 3 - Eligibility, Enrollment and Disenrollment (Revised August 7, 2012) • 50.2.1 - Sponsor Receives Notification of Possible Residence Change • If the PDP sponsor learns of a beneficiary address change that is outside the PDP service area from either CMS (i.e. a state and county code change on the TRR) or from the U.S. Postal Service®, it must follow the “Researching and Acting on a Change of Address” procedures outlined below. • 50.2.1.2 – Effective Date • Disenrollment as a result of receiving information from either CMS or the U.S. Post Office™ that the individual has not confirmed will be effective the first day of the calendar month after 12 months have passed. • 50.2.1.3 - Researching and Acting on a Change of Address • Within ten calendar days of receiving information from either CMS or the USPS®that a beneficiary may no longer reside in the service area, a PDP sponsor must make an attempt to contact the member to determine the beneficiary’s permanent residence and must document its efforts in doing so …

10. Medicare Prescription Drug Benefit Manual Chapter 3 - Eligibility, Enrollment and Disenrollment (Revised August 7, 2012) • 50.2.1.4 – Special Procedures for Auto and Facilitated Enrollees Whose Address Is Outside the PDP Region • CMS assigns most beneficiaries based on the State Medicaid Agency that reports the individual as dual eligible, even if that state is different than that in the address on CMS’ systems. In addition, beneficiaries may move after auto/facilitated enrollment occurs. If the PDP sponsor discovers that an individual whom CMS had auto/facilitated enrolled or reassigned has an address outside of the PDP sponsor’s region (e.g. via a state and county code change on the TRR or the USPS®), the PDP sponsor must make an attempt to determine the beneficiary’s permanent residence and must document its efforts in doing so. The PDP sponsor may accept either written or verbal confirmation that an individual has moved out of the service area, as long as the PDP sponsor applies the policy consistently among all members. • If the sponsor is unable to contact the auto/facilitated enrolled beneficiary, or receives no response, the PDP sponsor must not disenroll the beneficiary. This includes situations in which the beneficiary’s address is listed as a P.O. Box.

11. Medicare Prescription Drug Benefit Manual Chapter 3 - Eligibility, Enrollment and Disenrollment (Revised August 7, 2012) • 50.2.1.5 - Procedures for Developing Addresses for Members Whose Mail is Returned as Undeliverable • In the event that any member materials are returned as undeliverable…: • 1. If the USPS® returns mail with a new forwarding address, forward plan materials to the beneficiary and advise the plan member to change his or her address with the Social Security Administration. • 2. If the sponsor receives documented proof from the USPS of a beneficiary change that is outside of the PDP region or mail is returned without a forwarding address, follow the procedures outlined in § 50.2.1.3. • 3. If the beneficiary uses his or her drug coverage at a pharmacy in the plan’s network, the sponsor may choose to follow up with the pharmacy to obtain the member’s current address. • 4. If the sponsor is successful in locating the beneficiary, advise the beneficiary to update records with the Social Security Administration… • A PDP sponsor is expected to continue to mail beneficiary materials to the undeliverable address, as a forwarding address may become available at a later date, and is encouraged to continue to research addresses as described in the “Researching and acting on change of address” above.

12. Best Practice: Preparation The Key to Finding the Right Balance • Be sure you thoroughly understand: • The applicable regulations • Postal / Shippers • Industry • Company • Current Procedures • Company • Postal / Shippers • Tools and Services • Current and Pending • Postal / Shippers • Company • Vendors – including access to experts

13. It is OK to focus on part of the picture Best Practice Considerations But you need to see the whole picture to know what to really worry about and what is really holding you back

14. Activity focused on / aware of the big picture Risk mitigation (USPS® regulations, industry regulations, business practices) Review & Redesign processes to reduce waste volume and costs Common areas to look at initially: Data entry (paper forms, online, call center, representatives / agents) Data maintenance (pro-active vs. re-active) Data selection (establish intelligent outbound mail method selection) Return Mail processing (tracking, capture, investigation, processing) Processing timelines (inefficiencies and road blocks) Continuous Improvement: recurring schedule to review processes and procedures Redesign member materials Employee training materials Establish Postal Governance Ensure that you Know what you need to Know How are things working and trending What changes / opportunities are coming and what will be the impact Ensure Continuous Improvement Best Practice Considerations

15. Compare your performance to standards, other operations, your industry, entire mailing industry Multiple levels of reports is important – as well as trending Best Practice: Monitoring & Measuring Example % Valid Goal: > 93% % On Schedule Goal: > 98% Pass: > 97% Fail: < 97%

16. Annual mailing – required to communicate to all participants, includes a packet All Mailed First-Class Production and Postage: $700,000 Return Fees: $0 Program Total: $700,000 Able to change to efficient Standard Mail™ based mailing Production and Postage: $500,000 Return Fees: $125,000 Program Total: $625,000 Intelligent Selection of First-Class vs. Standard Mail Production and Postage: $550,000 Return Fees: $25,000 Program Total: $575,000 Pre-mailing, pro-active correction / suppression program Production and Postage: $502,500 Return Fees: $6,250 Program Total: $508,750 Best Practice: Continuous Improvement Example

17. Next Steps, Questions Next Steps: CMS, SSA, and GSA working with industry: Rule clarifications Process clarifications and improvements Identification and evaluation of other opportunities Mailers – do not live by the motto “if it ain’t broke…” If you are not watching, measuring, and evaluating: It may be broke and you do not know it You are not at Best Practices Questions?

18. Speaker Contacts Adam Collinson acollinson@grayhairsoftware.com (856) 313-6921 Derrick Miliner derrick.miliner@gsa.gov (202) 273-3564 Angela Lawson angela.lawson@usps.gov (901) 681-4458

19. More Information National Customer Support Center (800) 238-3150 Local Postal Customer Council http://www.usps.com/nationalpcc/welcome.htm Address Quality Best Practices MTAC Workgroup 97 Report https://ribbs.usps.gov/index.cfm?page=mtac Quality Address Management White Paper Association of Mailers for Electronic Enhancements Located at https://ribbs.usps.gov/index.cfm?page=amee