Annual Benefit Changes (ABCs)

Ohio

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Agenda

2

Back ground

on changes

Review of

portfolio

changes

Selling

Strategy

Communicatio

n dates

Consultative

Selling

Questions

Background on Changes

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Changes

•As a result of complying with healthcare reform – from an admin

•Lean but still attractive to groups and members – we made some reductions, we had some gaps – we created new plans to fill the gaps. Price points

•Added some additional plans to meet cost shares

•Stay competitive – managing portfolios = address gaps that were present – competitors – simplify portfolio

Options that groups are going to have

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Objectives of ABC Changes

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ABC Objectives

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2012 ABCs will focus more on portfolio management and less on benefit modifications

Simplified 2-99 portfolio with new cost share options to fill price point

gaps and offering different Rx options special enhancements to 2-50

Pharmacy portfolio standardization and modification

Benefit enhancements for Lumenos

What are the changes?

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Portfolio Changes

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Product Eliminations Rationale Blue Access PPO

Ohio has designed a new 2-99 portfolio New portfolio preliminary design offers 18 PPO products verses 14 SG and 15 Key plans Added additional RX options to the 100+ portfolio

Increase operational efficienciesCreate a more attractive portfolio Close the pricing gaps To address missing price points Eliminated unattractive plans

Lumenos Ohio may reduce total number of plans while creating the new 2-99 portfolioConsider elimination of richer 0% plans on 100+ portfolio

Increase operational efficiencies and create a more attractive, profitable portfolio

New Product Introductions (2-99) Rationale Blue Access PPO

Ohio is developing a new 2-99 portfolio effective May – June 2012 with a recommended 3% price point spread between plans

This will address many of the gaps on the current 6.0 portfolio and offer new cost shares and designs to remain competitive

Lumenos HRA first dollar Rx and Medical copays plus embedded deductible HSA with copay after deductible enhancement Placeholder for up to 10 additional plans to accommodate enhancements

We are losing groups to UHC; This will allow us to gain HRA market share while still attracting good risk

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Pharmacy Changes

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Pharmacy Changes 2-99 RationalePharmacy Core Reduce to 3 options total on the new portfolio

Implement Pharmacy Strategy Increase 4th tier per script max copay from $150 to $200 on 2-99Increase Home Delivery Generic copay to 2.5 times

Richness compared to competition Consistency across all Rx options Keep up with rising cost of Rx Provide cost savings/premium relief Richness or leanness of medical benefit paired with equally rich or lean Rx benefit decreases anti–selection issues

Pharmacy – CDH Introduce leaner CDH Rx Option by increasing existing tier copays Increase 4th tier per script max copay from $150 to $200Increase Home Delivery Generic copay to 2.5 times

Consistency across all Rx options Keep up with rising cost of Rx Provide cost savings/premium relief

100+ Eliminate Rx options on 100+ tab (richer options and those with little or no membership)

Increase administrative efficiencies

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Health Care Reform

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Anthem will comply with the HHS recommendations for Women’s Preventive effective 8/1/12. Several of these services will not require additional services, because the services are already covered based on other recommendations. The guidelines are listed below.

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Future Lumenos Enhancement List date TBD

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Enhancement Description

HSA Copay After Deductible

Allow medical flat dollar copayments after deductible for the following:

Only allowed on Blue 6 product platformAllowed after deductible has been met Must apply to the medical out-of-pocket maxDifferent copays for PCP and specialist

HRA First Dollar Copays

Pre-deductible office visits and pharmacy copayments only allowed on the Blue 6 product platformPCP/SCP copayments will only be allowed on 0%, 10% or 20% coinsurance plans

Physician home and office Specialist office Urgent care Emergency room Rx

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Future Lumenos Enhancement List date TBD

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Enhancement Description

HRA First Dollar RX

Can only offer one pre-deductible pharmacy option per benefit planPre-deductible pharmacy copays/coinsurance must maintain a 4 tier pharmacy structure Pre-deductible pharmacy copays/coinsurance will not apply to the medical deductible or out-of-pocket max

HRA Flex

Offers flexibility to choose allocation and rollover options without impacting standard product offerings Groups will not be allowed to select a traditional HRA option and offer it along side an HRA FlexExisting HRA proration options will continue to apply Embedded deductible availability is based on existing options available

Selling Strategy, Competition and Processes

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What is the competition doing?

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Observations and OpportunitiesWe are leaner than UHC in portfolio size in the Key market. Humana is

larger due to 2-99 single portfolio

We offer fewer 0% plans than either competitor

Humana now offering plans with $300-$350 copays. UHC $250 ER on all.

We offer $250 ER on select plans

We are the richest with a $200 and $250 deductible (on Key portfolio) verses

$500 as the richest with top two competitors

We offer fewer HAS 100% plans than UHC who offers 10; Humana offers 3

UHC offers an HRA product with Rx copays day on and an embedded

deductible resulting in challenges and group loss for sales

We offer the richest 4 tier Rx option

Gaps identified on SG and Key that must be addressed with new portfolio

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Selling Strategies

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Market Segments: Funding Arrangements:

New Business Renewals

Well Quote System

Quote Date

Effective Date

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Updated SQFs and SOBs

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Important Dates

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