HOLOGIC, INC. WELFARE BENEFIT PLAN Summary Plan ... · employee), or occasional worked employee. Except with respect to the Hologic Medical Plan, “Employee” also does not include

1

HOLOGIC, INC.

WELFARE BENEFIT PLAN

Summary Plan Description

APRIL 1, 2018

2

TABLE OF CONTENTS

PAG E

SECTION 1 DEFINITIONS ......................................................................................... 1

SECTION 2 INTRODUCTION .................................................................................... 3

SECTION 3 GENERAL INFORMATION ABOUT THE PLAN ................................ 3

SECTION 4 ELIGIBILITY AND PARTICIPATION REQUIREMENTS .................. 6

SECTION 5 SUMMARY OF PLAN BENEFITS AND CONTRIBUTIONS ........... 11

SECTION 6 PLAN ADMINISTRATION .................................................................. 11

SECTION 7 CIRCUMSTANCES THAT MAY AFFECT BENEFITS

DENIAL OR LOSS OF BENEFITS ..................................................... 12

SECTION 8 STATEMENT OF ERISA RIGHTS ...................................................... 17

SECTION 9 SPECIAL RULES FOR GROUP HEALTH BENEFIT PLANS ........... 18

SECTION 10 CLAIMS PROCEDURES ...................................................................... 37

1

SECTION 1

DEFINITIONS

Capitalized terms used in the Plan have the following meanings:

1.1 “AD&D” means accidental death and dismemberment insurance.

1.2 “Board of Directors” means the Board of Directors of the Company.

1.3 “Claims Administrator” means the insurance company, third party administrator or

other entity appointed by the Company to determine benefit eligibility

or availability and pay claims for benefits under a Welfare Program. If no Claims

Administrator is indicated then the Company shall be the Claims Administrator.

1.4 “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as

amended.

1.5 “COBRA Administrator” means the administrative entity or person(s) appointed by

the Plan Administrator to act as COBRA Administrator.

1.6 “Code” means the Internal Revenue Code of 1986, as amended.

1.7 “Company” means Hologic, Inc. and its subsidiaries.

1.8 “Dependent” means a dependent of the Employee as defined in the applicable

Welfare Program document.

1.9 “Employee” any person currently employed by the Employer who is receiving

compensation for services performed, who is classified by the Employer as a regular full-time

employee, part-time employee, or intern and meets the criteria of Section 4 of this SPD.

“Employee” does not include any temporary employee, leased employee, employee not regularly

scheduled to work a defined number of hours per week (i.e., classified as a variable hour

employee), or occasional worked employee. Except with respect to the Hologic Medical Plan,

“Employee” also does not include any individual classified as an intern.

1.10 “Employer” means the Company, and Gen-Probe, Inc., Hologic (MA), LLC, Gen-

Probe Sales & Service and, effective as of October 1, 2017, Cynosure, Inc. each that

participates in the Plan. The Plan Administrator shall have the right to terminate any

Employer’s adoption of the Plan at any time.

1.11 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

1.12 “FMLA” means the Family and Medical Leave Act of 1993, as amended.

1.13 “Former Employee” means any person formerly employed as an Employee of the

Employer.

1.14 “Group Health Benefits” means a benefit through an employee welfare benefit plan,

as defined in Section 3 of ERISA, in the form of “medical care” (as defined in Section 213(d)

2

of the Internal Revenue Code) to Participants, directly, through insurance, reimbursement or

otherwise.

1.15 “Health Flexible Spending Account” means a Group Health Benefit offering

reimbursement for eligible medical expenses as described in the Hologic, Inc. Welfare Benefit

Plan and in Internal Revenue Code Sections 105, 125 and the regulations thereunder, which

reimburses qualifying Medical Care Expenses of eligible Employees and their eligible

Dependents where such expenses are not otherwise covered under the Company’s Group

Health Benefit plans.

1.16 “Health Savings Account” means the Accounts established under Code section 223

(“HSA Accounts”) and Section 4.06.

1.17 “HIPAA” means the Health Insurance Portability and Accountability Act of 1996, as

amended.

1.18 “Participant” means an Employee or Former Employee of the Employer who meets

the requirements for eligibility and who properly enrolls in the Plan (other than employees of

Cynosure who were enrolled on October 1, 2017). A person shall cease to be a Participant

when he or she no longer meets the requirements for eligibility as set forth in the Plan and in

the specific Welfare Program. A Participant shall also include a Dependent properly enrolled

in this Plan. Effective as of October 1, 2017, any Employee who was employed by Cynosure

and participating in the Cynosure, Inc., Cafeteria Plan shall begin participating in the Plan for

the remaining portion of the Plan Year.

1.19 “Plan” means this plan, the Hologic, Inc. Welfare Benefit Plan and each Welfare

Program incorporated by reference.

1.20 “Plan Administrator” means the Company or the person or persons appointed by the

Company to act as Plan Administrator.

1.21 “Plan Year” “Plan Year” means each twelve (12) consecutive month period

commencing on July 1 and ending on June 30.

1.22 “QMCSO” means a qualified medical child support order issued by a court or state

agency to provide benefits to a dependent child.

1.23 “Qualified Beneficiary” means a covered Employee or covered Dependent.

1.24 “SPD” means any Summary Plan Description, Summary of Material Modifications or

other employee communication that describes the benefits under a Welfare Program, and has

been included by the Company and/or Employer as part of this Plan.

1.25 “USERRA” means the Uniformed Services Employment and Reemployment Rights

Act of 1994, as amended.

1.26 “Welfare Program” means a Welfare Program incorporated into this Plan that is

offered by the Company and/or an Employer that provides an Employee a benefit that would

be treated as an “employee welfare benefit plan” under Section 3(1) of ERISA if offered

3

separately. Welfare Program may also mean any plan established pursuant to Section 125 of

the Code.

SECTION 2

INTRODUCTION

2.1 The Plan

The Company maintains the Plan for the exclusive benefit of its eligible Employees

and their spouses and eligible Dependents. The Welfare Programs are named in Appendix B

of the Plan, as supplemented by the Plan Administrator.

2.2 The Welfare Programs

Each of these Welfare Programs is summarized in a certificate of insurance issued by

an insurance company, a benefit summary, a SPD or another governing document prepared by

the insurer. A copy of each certificate, summary or other governing document is available, free

of charge, upon request by calling your Human Resources representative.

2.3 Document Serves as SPD

This document and its attachments constitute the Summary Plan Description (“SPD”)

for each of the Welfare Programs to the extent required by ERISA §102.

SECTION 3

GENERAL INFORMATION ABOUT THE PLAN

3.1 Human Resources the Contact for Plan Information

If you have any general questions regarding the Plan, your eligibility for or the amount

of any benefit payable under the self-funded Welfare Programs, please contact Human

Resources.

3.2 Insurance Company the Contact for Insured Plan Information

If you have any specific questions regarding your eligibility for or the amount of any

benefit payable under the fully insured Welfare Programs, please contact the appropriate

insurance company.

Plan Name Hologic, Inc. Welfare Benefit Plan

Plan Sponsor, Plan

Administrator and

Named Fiduciary

Hologic

250 Campus Drive

Marlborough, MA 01752

Plan Sponsor’s

Employee

Identification

Number

04-2902449

4

Type of Plan and

Types of Benefits

under the Plan

Welfare Program providing medical, dental, life, long term and

short term disability, accidental death and dismemberment and

prescription drug benefits. The Plan includes a cafeteria plan

under Code Section 125, however the cafeteria plan is not

subject to ERISA.

Plan Year and

Effective Date

July 1 through June 30.

The Plan initially became effective on July 1, 2008

The end of the Plan Year is June 30.

Plan Number 506

Funding Medium and

Type of Plan

Administration:

Some benefits under the Plan are self-funded, and some are

fully insured.

Contributions for the self-insured Welfare Programs are made

in part by the Company and in part by Employees’ pre-tax

contributions. All benefits under a self-insured Welfare

Program shall be paid exclusively from the general assets of

the Company, shall constitute a general obligation of the

Company, and the Company shall not, and shall not be

obligated to, provide funding for such benefits through a trust,

insurance or otherwise.

Benefits under an insured Welfare Program shall be provided

exclusively through the insurance policy or policies under such

Plan. Insurance premiums for the fully insured benefits are

either paid in part by the Company out of its general assets and

in part by an Employees’ pre-tax payroll deductions, entirely by

the Company out of its general assets or entirely by an

Employees’ payroll deductions (pre-tax or post-tax) .

Human Resources

Contact Information

Hologic

250 Campus Drive


Attention: Human Resources

Agent for Service of

Legal Process

Hologic

250 Campus Drive


Attention: Plan Administrator

5

Insurance Companies and Claims and COBRA Administrator:

Medical Blue Cross Blue Shield of Massachusetts

P.O. Box 986030

Boston, MA 02298

800.358.2227

CIGNA

PO Box 15050

Wilmington, DE 19850

800.441.2668

Blue Cross Blue Shield of Hawaii

HMSA, PO Box 860

Honolulu, HI 96808-0860

808.948.555 (option 3)

Dental Delta Dental Plan of Massachusetts

PO Box 9695

Boston, MA 02114

800.872.0500

Prescription Drug CVS Caremark

One CVS Drive

Woonsocket, RI 02895

855.271.6598

Life and Accidental

Death & Disability

Liberty Life Assurance Company of Boston

100 Liberty Way

Mail Stop 02H-R824

Dover, NH 03820

888.787.2129

Long Term Disability Liberty Life Assurance Company of Boston

P.O. Box 7211

London, KY 40742-7211

888.440.6118

Short Term Disability Liberty Life Assurance Company of Boston

P.O. Box 7211

London, KY 40742-7211

888.440.6118

COBRA Continuation

Coverage

Administrator

Businessolver, Inc.

Attn: COBRA Administrator

P.O. Box 310512

Des Moines, IA 50331-0512

877.547.6257

Employee Assistance

Program

ACI Enterprises, Inc. (DBA ACI Specialty Benefits)

6480 Weathers Place, Suite 300

San Diego, CA 92121

800.932.0034

6

The Hologic Health

Flexible Spending

Account

PayFlex Systems USA, Inc.

PO Box 3039

Omaha, NE 68103-3039

800.284.4885

The Hologic Health

Savings Account

HealthEquity

15 West Scenic Pointe Drive

Draper, UT 84020

877.694.3938

3.3 An Important Disclaimer About Insurance Contracts and Welfare Program

Documents

The Welfare Program benefits are provided through either an insurance contract or a

governing plan document adopted by the Company. If the terms of this SPD conflict with the

terms of an insurance contract or a governing plan document, then the terms of the insurance

contract or governing plan document will control, unless otherwise required by applicable law.

3.4 Insured Benefits Provide Exclusively Through Insurance Contract

Benefits through a Welfare Program provided through insurance are provided

exclusively through the insurance contracts. The Company reserves the right to put in force,

allow to lapse, cancel, substitute or otherwise deal with any insurance policy providing benefits

under an insured Welfare Program under the Plan. Upon the lapse, termination, cancellation or

other event causing any such insurance policy to no longer be in force, no benefits will be

provided under this plan with respect to this Plan until any substitute or replacement policy of

insurance is in force with respect to such benefit. This Plan and any Welfare Program

thereunder does not provide self-funded benefits except as specifically provided herein, and

all other benefits are provided through insurance products and policies exclusively.

SECTION 4

ELIGIBILITY AND PARTICIPATION REQUIREMENTS

4.1 Eligibility Information in Welfare Program

The Welfare Program may contain eligibility and participation information. If so, the

information in the Welfare Program document will be determined by the Welfare Program

document and not this SPD. To determine whether you or your dependents are eligible to

participate in the Welfare Programs, please read the eligibility information contained in those

specific program materials.

4.2 Eligibility

You are eligible to participate in the Plan (See Appendix B)if you are and Employee

currently employed by the Employer on a regular full-time, or part-time, or intern basis, who

is scheduled to work at least 30 hours or more per week and you are eligible to participate and

receive benefits under one or more of the Welfare Programs offered under the Plan. You are

not eligible to participate in the Plan if you are a temporary employee, leased employee,

employee not regularly scheduled to work a defined number of hours per week (i.e., classified as

7

a variable hour employee), or occasional worked employee. Employees classified as interns who

are regularly scheduled to work at least 30 hours per week will be eligible to participate in the

Hologic Medical Plan only after completing 90 consecutive days of service with the Employer.

You are not eligible to participate in the Plan if you are covered by a collective

bargaining agreement (CBA), unless the CBA specifically provides for coverage under this

Plan. In addition, eligibility for specific Welfare Programs offered under the Plan are governed

by the terms of those programs.

4.3 Participation

Your participation in the Plan will begin for you and your eligible Dependents on the

date you become a Participant in any of the Welfare Programs identified in Appendix B of the

Plan.

4.4 Special Rules for Dependent Eligibility and Participation

You may elect coverage for your eligible Dependents in the Plan, but there may be

special eligibility rules under your specific Welfare Program. For information about the

specific Welfare Program, please consult that program’s certificate of insurance, SPD, and

current benefit summary.

4.5 Proof of Dependent Status

You may be required to periodically provide proof of your eligible Dependent’s tax

dependent status.

4.6 Important Rules for Eligibility and Participation

Only eligible Employees, eligible Former Employees and eligible Dependents may

participate in the Plan. You may be covered as an eligible Employee or an eligible Dependent

under the Plan, but not both. More than one eligible Employee cannot cover the same

individual as an eligible Dependent.

4.7 Signed Statements

Any statement regarding your health, age, full-time student status, coverage under

another health plan or other information provided to obtain benefits in writing and signed by

you, may be used to contest benefits you have received under the Plan.

4.8 Correct Age

The Plan will only pay benefits based on your correct age. If you misstate your age, the

Plan will either: a) adjust any required contributions; b) validate your age; or c) void coverage

as necessary or appropriate, in the discretion of the Plan Administrator.

4.9 Fraudulently Obtaining Benefits is a Federal Crime

8

It is a federal crime to receive benefits that you are not entitled to by falsely claiming

to be an eligible Employee, an eligible Former Employee, or falsely enrolling or claiming to

be an eligible Dependent under the Plan.

4.10 Enrollment

The following information is generally applicable to all Welfare Programs; however,

those Welfare Programs may have specific enrollment requirements. Please consult the

Welfare Program materials to determine whether there are special rules that may apply to your

participation in the Plan.

4.11 Time Limit for Enrollment

You must enroll in the Plan within 31 calendar days of the day you become eligible for

participation in the Plan (your “enrollment period”). If you do not enroll during your

enrollment period, you may not enroll yourself or any eligible Dependent until the next annual

enrollment period, unless certain exceptions apply. You may only enroll after an enrollment

period expires if: (i) you or your eligible Dependent experience an eligible status change event,

(ii) you or your Dependent become a HIPAA “special enrollee” or (iii) Group Health Benefit

coverage is mandated under a QMCSO.

4.12 Enrollment Through a Qualified Medical Child Support Order

A QMCSO is a court order requiring a Group Health Benefit plan to enroll a Dependent

child of an eligible Employee in Group Health Benefit coverage under the Plan. Typically, a

QMCSO is issued as part of a divorce or separation agreement. When the Plan receives a

QMCSO, the Plan Administrator will provide written notice to the Employee, the Dependent

child to whom the order applies and the custodial parent or the court or state agency issuing the

order (“Alternate Recipient(s)”) of receipt of the order and of the applicable written procedures.

The Plan Administrator shall determine in its exclusive discretion whether an order meets the

requirements for a QMCSO and will notify the eligible Employee and any Alternate Recipients

of the determination. Once a determination is made that an order is a QMCSO, the Dependent

child will be treated as any other eligible Dependent covered under the Plan.

4.13 Effective Date of Coverage

Your benefits under this Plan will be effective as stated in the specific Welfare Program

document.

4.14 Special Enrollment Rules for Medical Benefits Following a Status Change Event

The following rules apply only to Group Health Benefits.

If a status change event occurs, you have 31 calendar days from the date the status

change event occurred to enroll yourself and/or your eligible Dependents (as long as your

enrollment change request is directly related to your change in status).

9

4.15 Status Change Events:

A status change event is any of the following events that affect a Participant’s eligibility

under the Plan:

1. Your marriage, legal separation, divorce, or annulment;

2. The birth, legal adoption of a child, or placement of a child with you for legal

adoption;

3. The death of your Dependent;

4. A change in your or your Dependent’s employment status that affects eligibility

under the Plan;

5. A termination or commencement of employment;

6. A strike or lock-out;

7. A commencement of or return from an unpaid leave of absence;

8. A change in your or your dependent child’s status (e.g., your Dependent child

reaches the age limit for coverage) that affects your eligibility under the Plan;

9. A change in residence that results in a loss of eligibility or coverage under the Plan

or a Welfare Program (not applicable to Health Flexible Spending Account

elections);

10. A family status changes that result in “special enrollment rights” under the HIPAA;

11. A change in the eligibility under the welfare benefit plan of your spouse or eligible

Dependent (not applicable to Health Flexible Spending Account elections);

12. A commencement of or return from a FMLA leave;

13. A judgment, decree, or order resulting from a legal separation, divorce, annulment,

or change in legal custody (including a QMCSO) that requires accident or

health coverage for a child or foster child who is a Dependent of the Employee;

14. You or your eligible Dependent becomes entitled to or loses eligibility for Medicare

or Medicaid;

15. A significant change in cost or coverage of your current Welfare Program option(s)

(not applicable to Health Flexible Spending Account elections);

16. Loss of governmental/educational institutional group health coverage plan;

10

17. Your employment status changes from working at least 30 hours per week to less

than 30 hours per week.

18. You become eligible to obtain coverage through a public health exchange and you

intend to enroll in a qualified health plan on such exchange.

If you experience a status change event and properly enroll in the Plan within 31 days of

that event, your coverage will be effective no later than the first day of the month following the

date the Plan Administrator receives the completed enrollment form. However, if you are

requesting enrollment under the Plan due to a HIPAA special enrollment right because of the

birth, adoption, or placement for adoption of a child with you and you have properly enrolled

within 31 days of the birth, adoption, or placement, then the effective date of coverage will be

the date the event, as applicable.

If you do not act within this 31 day window, you will lose your right to enroll in the

Plan and may not enroll yourself or any eligible Dependent until the next annual enrollment

period unless: (i) another status change event occurs that would allow you to enroll in the Plan

or, (ii) you or your Dependent becomes a “special enrollee” under HIPAA or (iii) Group Health

Benefit coverage is mandated under a QMCSO.

To change your election or to enroll in the Plan, please contact Human Resources no

later than 31 days after the status change event.

4.16 Important Note about Enrolling your Newly Acquired Child

Your newborn, adopted child or child placed for adoption is not automatically enrolled

in the Plan even if you have other Dependents covered. You must enroll your child within 31

calendar days of birth, adoption or placement for adoption or the child will not be enrolled in

the Plan. If you fail to enroll the child within 31 calendar days of birth, adoption or placement

for adoption, you may not enroll the child until the next annual enrollment period.

4.17 Termination of Participation

Participating in the Plan for you and your eligible Dependents will terminate according

to the provisions of the specific Welfare Program document. Coverage also may terminate if

you fail to pay your share of an applicable premium, if your hours drop below any required

hourly threshold, if you submit false claims or for any other reason set forth in the specific

Welfare Program materials. You should consult the specific Welfare Program materials for the

exact terms of termination of participation.

4.18 Continuation of Group Health Benefit Plan Coverage

COBRA

If Group Health Benefit coverage for you or your eligible Dependent ceases because

of certain “Qualifying Events” specified in COBRA (such as termination of employment,

reduction in hours, divorce, or a covered Dependent child’s ceasing to be eligible under the

Plan), then you and your eligible Dependents may have the right to purchase COBRA

continuation coverage for a temporary period of time. For more information about your

COBRA rights, please see the COBRA Continuation Coverage Section of this SPD.

11

USERRA

Continuation coverage and reinstatement rights lasting up to 24 months may be

available if you are absent from employment due to service in the uniformed services pursuant

to USERRA. More information about coverage available pursuant to USERRA is available

from Human Resources.

SECTION 5

SUMMARY OF PLAN BENEFITS AND CONTRIBUTIONS

5.1 Cost of Benefits and Contributions

The Plan may provide you and your eligible Dependents with health, long-term

disability, AD&D, group term life insurance, and Health Flexible Spending Account benefits.

You must meet the eligibility requirements of both this Plan and the specific Welfare Program

in order to receive benefits under that specific plan.

The cost of the benefits provided through the Welfare Program will be funded either

(i) in part by Company contributions and in part by pre-tax covered Employee contributions,

entirely by the Company or (ii) entirely by covered Employee pre-tax or post-tax contributions.

The Company will determine and periodically communicate your share of the cost of the

benefits provided through each Welfare Program and it may change that determination at any

time.

The Company will make its contributions in an amount that (in the Company’s sole

discretion) is at least sufficient to fund the benefits or a portion of the benefits that are not

otherwise funded by your contributions. The Company will pay its contribution and your

contributions to an insurance carrier, or, with respect to benefits that are self-insured, will use

these contributions in addition to the Company’s own contributions to pay benefits directly to

you, on behalf of you or on behalf of your Eligible Dependents from the Company’s general

assets. Your contributions toward the cost of a particular benefit will be used in their entirety

prior to using Company contributions to pay for the cost of self-funded benefits.

SECTION 6

PLAN ADMINISTRATION

6.1 Rights and Duties of the Plan Administrator

The administration of the Plan is under the supervision of the Plan Administrator, who

has been designated to act on behalf of the Company.

The principal duty of the Plan Administrator is to see that the Plan is carried out, in

accordance with its terms, for the exclusive benefit of persons entitled to participate in the Plan.

The administrative duties of the Plan Administrator include, but are not limited to, interpreting

the Plan, prescribing applicable procedures, determining eligibility for and the amount of

benefits, and authorizing benefit payments and gathering information necessary for

administering the Plan. The Plan Administrator may delegate any of these administrative duties

among one or more persons or entities, provided that such delegation is in writing, expressly

12

identifies the delegate(s) and expressly describes the nature and scope of the delegated

responsibility.

The Plan Administrator has the discretionary authority to interpret the Plan in order to

make eligibility and benefit determinations as it may determine in its sole discretion. The Plan

Administrator has the discretionary authority to make factual determinations as to whether any

individual is entitled to receive any benefits under the Plan. The Company will bear its

incidental costs of administering the Plan.

6.2 Power and Authority of Insurance Company

Certain benefits under the Plan are fully insured. Group insurance contracts with the

following insurers provide for the following benefits: life, AD&D and LTD.

The insurance companies are responsible for: (1) determining eligibility for and the

amount of any benefits payable under their respective Welfare Programs; and (2) prescribing

claims procedures to be followed and the claims forms to be used by employees pursuant to

their respective Welfare Programs.

SECTION 7

CIRCUMSTANCES THAT MAY AFFECT

BENEFITS DENIAL OR LOSS OF BENEFITS

7.1 Loss or Denial of Benefits under the Plan

Your benefits (and the benefits of your eligible Dependents) will cease when your

participation in the Plan terminates. Your benefits will also cease upon the termination of the

Plan. Please refer to Section 4 of this SPD for information about when your coverage under

the Plan terminates. Your benefits will also cease upon termination of the Plan.

Other circumstances may also result in the termination, reduction or denial of benefits.

For example, benefits may be denied under the medical or dental benefit programs if you have a

preexisting condition and incur costs within the exclusionary period. You should consult the

certificate of insurance booklets, summary plan descriptions and other governing documents of

the specific Welfare Program for additional information.

7.2 Coordination of Benefits

If a Participant has coverage under this Plan as well as Coverage from Another Source

(defined below), benefits that are received through this Plan shall be coordinated with the

benefits available under the plan containing the Participant's other source of benefits. This

Coordination of Benefits (“COB”) provision shall apply to all Group Health Benefits provided

under this Plan.

7.3 Coverage from Another Source

For purposes of this Plan, “Coverage from Another Source” shall mean any other plan

providing benefits or services for medical treatment, including but not limited to, one of the

following:

13

• Group insurance, or any other arrangement of coverage for individuals in a group

Health Maintenance Organization (“HMO”) or other group on an insured, self-

insured or uninsured basis, or state or federal programs providing health coverage;

Group coverage sponsored through a school or other educational institution for a

student;

• Group coverage under a franchise organization; or

• No-fault insurance required under any law of a government and provided on other

than a group basis, but only to the extent the benefits are required under such no-

fault law.

7.4 Construction

Coverage from Another Source will be construed separately with respect to each policy,

contract or other arrangement for benefits or services, and separately with respect to that

portion of any such policy, contract, or other arrangement which reserves the right to take the

benefits or services of other plans into consideration in determining its benefits and that portion

which does not.

7.5 Benefits in the Form of Services

When a plan provides benefits in the form of services rather than cash payments, the

reasonable cash value of each service rendered will, for purposes of this Plan, be considered to

be both a covered charge and the amount of benefit paid.

7.6 Ordering of Benefits

When coverage is provided by two or more sources as stated above, the plan that is

primary is established in the following order:

• The plan that has no COB provision will be considered primary to a plan that has

COB provisions;

• The plan that has a COB provision, except that such COB provision is not similar

to this Plan's COB provision, shall be considered primary to this Plan which has a

COB provision;

• The plan covering the person as an active employee will be primary to the plan

covering the person as a dependent;

• The plan covering a person as an active employee will be primary to the plan

covering the person as a retired, terminated, inactive, suspended or laid-off

employee;

• The plan covering a person in his or her own capacity will be primary to the plan

covering a person as a dependent; however, if the person is a Medicare beneficiary,

and Medicare is secondary to the plan covering the person as a dependent and primary

to the plan covering the person as a non-dependent, then the plan covering the person

14

as a dependent is primary, Medicare is secondary and the plan covering the person as

a non-dependent is the tertiary plan;

• The plan covering a dependent as a dependent of an active employee is primary to

the plan covering the dependent as the dependent of a former employee or as a

COBRA participant;

• For the purposes of a dependent covered under the plans of both of his or her non-

divorced parents (or parents who never married, but who live together) the plan

covering the parent whose birthday falls first in the year will be primary to the plan

covering the parent whose birthday falls later in the year. If both parents have the

same birthday, then the plan covering the parent for the longest period of time will

be primary; or

• For a dependent whose parents are divorced or legally separated (or if the parents

never married and do not live together), and the dependent is covered by the plans

of both parents, the plan covering the parent who is responsible for the dependent's

health care under the terms of a court decree or state agency order will be the

primary payor. In the absence of such court decree or state agency order payment

will be made in the order as follows:

the plan of the natural parent with custody;

the plan of the step-parent with custody; and

the plan of the natural parent without custody.

However, if none of the rules outlined in this Section 7 apply, then the plan covering

the person for the longest period of time will be primary.

7.7 Reduction of Benefits Payable by the Plan

Whenever this Plan is considered secondary to another plan, benefits will be payable

by the primary plan to the extent that the expense is an incurred charge, and this Plan shall be

liable for the remainder of the eligible expenses that would be payable in the absence of dual

coverage up to the amount that would otherwise be payable to the extent payable in total under

this Plan.

7.8 Subrogation and Reimbursement

If a Participant becomes entitled to benefits under the Plan as a result of an injury or

illness for which a third party is, or may be, held responsible for any reason, the Plan may: (1)

make full or partial advance benefit payments to, or payments on behalf of, such Participant,

subject to the Plan’s subrogation and reimbursement rights; or (2) may delay payment of all or

part of such benefits and either pay such benefits or require the third party to pay such benefits

upon settlement or judgment. However, before any such reimbursements or payments will be

conditionally made, the Participant shall execute a subrogation and reimbursement agreement in

a form acceptable to the Plan that acknowledges and affirms: (1) the conditional nature of the

reimbursements or payments; and (2) the Plan’s rights of subrogation and reimbursement, as

15

provided for below. However, payment by the Plan of any benefits prior to or without obtaining

a signed subrogation and reimbursement agreement shall not operate as a waiver of the Plan’s

subrogation and reimbursement rights. For the purposes of the subrogation and reimbursement

provision of this Section 7, the Company and any of its affiliates shall be considered a “third

party”.

If a Participant receives any benefits arising out of an injury or illness for which the

Participant has or may have, or asserts any claim or right to recovery against a third party or

parties, third-party insurance or first-party insurance, then any payment or payments under this

Plan for such benefits shall be made on the condition and with the understanding that this Plan

will be reimbursed. Such reimbursement will be made by the Participant to the extent of, but

not exceeding, the total amount payable to or on behalf of the Participant or recovered by the

Participant from: (1) any policy or contract from any insurance company or carrier (including

the Participant’s insurer and specifically including the Participant’s own or any other person’s

uninsured/under-insured automobile coverage, medical pay, personal injury protection or no

fault benefits); and/or (2) any third party, plan or fund as a result of a judgment, settlement or

otherwise. The Participant acknowledges and agrees that this Plan will be reimbursed in full

before any amounts (including attorney fees incurred by the Participant) are deducted from the

gross policy proceeds, judgment or settlement.

Any recovery the Participant (or his attorney, assign, legal representative, Dependent or

beneficiary) receives shall be held in constructive trust for the benefit of the Plan, to the extent

of the Plan’s prior payments or provision of benefits. The Plan also has the right to withhold

future payments and provisions of benefits and offset future obligations (whether or not related

to the injury or illness in question) against any benefits for which the Participant has received a

third-party recovery (whether or not already paid or provided by the Plan). As part of the Plan’s

subrogation and reimbursement rights, any recovery from a third party will be applied first to

reimburse the Plan (or discharge its obligation for future payments or benefits), even if the

Participant is not paid for all of his or her claim for damages against the third party or otherwise

made whole, and even if the payment the Participant receives is for, or is described as being for,

damages other than health care expenses or benefits paid, provided, or covered by the Plan. This

means that any third-party payment will be automatically deemed to first cover the medical

expenses or benefits previously paid, provided, or otherwise covered by the Plan, and will not

be allocated to or designated as reimbursement for any other costs or damages the Participant

may have incurred, until the Plan is reimbursed in full or otherwise made whole. The Plan’s

first dollar priority lien means that the Plan must be paid first from any recovery, prior to

deduction for attorney’s fees. In addition, the Plan is not responsible for a Participant’s legal

fees, is not required to share in any way for any payment of such fees, and its lien shall not be

reduced by any such fees.

In addition, by participating in the Plan and receiving benefits hereunder, the

Participant automatically grants a lien to the Plan to be impressed upon all rights of recovery

against any other parties described above. To perfect this lien, the Plan or Plan Administrator

may file a copy of a subrogation and reimbursement agreement (signed by the Participant) with

such other parties, or the Plan or Plan Administrator may notify any other parties of the

existence of the lien.

16

This Plan will be subrogated to all claims, demands, actions and rights of recovery

against any entity, including, but not limited to, third parties and insurance companies and

carriers (including the Participant’s own insurer). The amount of such subrogation and

reimbursement will equal the total amount paid under this Plan arising out of the injury or

illness for which the Participant has or may have, or asserts a cause of action. In addition, this

Plan will be subrogated for attorney’s fees and other expenses incurred in enforcing its

subrogation and reimbursement rights under this Plan.

The Participant specifically agrees to do nothing to prejudice this Plan’s rights to

reimbursement or subrogation. In addition, the Participant agrees to cooperate fully with the

Plan in asserting and protecting the Plan’s subrogation and reimbursement rights. The

Participant on behalf of him or herself agrees to execute and deliver all instruments and papers

(in their original form) including a subrogation and reimbursement agreement and do whatever

else is necessary to fully protect this Plan’s subrogation and reimbursement rights. By

participating in the Plan, the Participant automatically agrees to all the terms of this provision

of the Plan and of the subrogation and reimbursement agreement.

Should a Participant make or file a claim, demand, lawsuit or other proceeding against

a third party or against the Participant’s own first-party insurance coverage, who may be liable

for the amount of benefits covered or paid by the Plan, the Participant shall, as part of such

claim, demand, lawsuit or other proceeding, on behalf of the Plan, also seek payment or

reimbursement for the full amount of such benefits covered or paid by the Plan. A Participant

must notify the Plan Administrator prior to making or filing any such claim, demand, lawsuit

or other proceeding. The Plan Administrator may, in its sole discretion, at that time or any

other time: (1) instruct the Participant to seek, not to seek, or to discontinue seeking payment

or reimbursement on behalf of the Plan; and (2) pursue such payment or reimbursement

independently in the same or in a separate lawsuit or other proceeding or may abandon such

payment or reimbursement altogether.

Any compromise or settlement entered into by a Participant purporting to reduce or

limit the amount of the payment designated as reimbursement for medical or any other

expenses covered under the Plan to an amount which is less than the benefits paid or covered

by the Plan shall not be effective unless the Plan Administrator consents thereto in writing.

The Participant specifically agrees to notify the Plan Administrator, in writing, of whatever

benefits are paid under this Plan that arise out of any injury or illness that provides or may

provide the Plan subrogation and/or reimbursement rights under Section 7.

For purposes of the subrogation and reimbursement provisions of this Section 7, the

term Participant shall include, as applicable, the Participant and/or the Participant’s estate or

legal guardian and any legal representative appointed by the Participant, as appropriate.

7.9 Amendment or Termination of the Plan

The Company or the Board of Directors has the right to amend or terminate the Plan at

any time. The Plan may be amended or terminated by a written instrument duly adopted by the

Company or any of its authorized officers.

17

The Company (or its duly appointed representative) may sign insurance contracts for

this Plan on behalf of the Company, including amendments to those contracts, and may adopt

(by a written instrument) amendments to the Plan that he or she considers to be administrative

in nature or advisable in order to comply with applicable law.

Any amendment or termination of this Plan will not affect your rights under the Plan

prior to the amendment or termination, unless the Company determines that such amendment

or termination is necessary to comply with applicable law.

7.10 No Contract of Employment

The Plan is not intended to be, and may not be construed as constituting, a contract of

employment or other arrangement between you and the Company to the effect that you will be

employed for any specific period of time.

SECTION 8

STATEMENT OF ERISA RIGHTS

As a participant in welfare benefit plan governed by ERISA, you (all references to you

in this Section 8 shall include your covered Dependents) are entitled to certain rights and

protections under ERISA. ERISA provides that, as a participant, you are entitled to:

• Examine, without charge, at the Plan Administrator’s office and at other specified

locations, the Plan documents, including insurance contracts, and copies of all

documents filed by the Plan with the U.S. Department of Labor (if any) such as

annual reports and Plan descriptions;

• Obtain copies of the Welfare Program documents and other program information

upon written request to the Plan Administrator (the Plan Administrator may make

a reasonable charge for the copies); and

• Receive a summary of the Plan’s annual financial report, if any (the Plan

Administrator is required by law to furnish each participant with a copy of this

summary annual report).

8.1 Fiduciary Obligations

In addition to creating rights for participants, ERISA imposes duties on the people who

are responsible for the operation of the Welfare Program. These people, called “fiduciaries” of

the program, have a duty to operate the program prudently and in the interest of you and other

program participants. Fiduciaries who violate ERISA may be removed and may be required to

make good any losses they have caused the program.

8.2 No Discrimination

No one, including the Company or any other person, may fire you or discriminate

against you in any way with the purpose of preventing you from obtaining welfare benefits or

exercising your rights under ERISA.

18

8.3 Right to Review

If your claim for a welfare benefit is denied in whole or in part, then you must receive

a written explanation of the reason for the denial. You have a right to have the Plan

Administrator review and reconsider your claim.

8.4 Filing Suit

Under ERISA, there are steps that you can take to enforce these rights. For instance, if

you request materials from the Plan Administrator and do not receive them within 30 days, you

may file suit in a Federal court. In such a case, the court may require the Plan Administrator to

provide the materials and pay you up to $110 per day until you receive the materials, unless

the materials were not sent due to reasons beyond the control of the Plan Administrator. If you

have a claim for benefits that is denied or ignored in whole or in part, and you have exhausted

all available claims procedures under the Plan, then you may file suit in a state or Federal court.

If it should happen that any Welfare Program fiduciaries misuse the Plan’s money, or

if you are discriminated against for asserting your rights, you may seek assistance from the

U.S. Department of Labor or you may file suit in a Federal court. The court will decide who

should pay court costs and legal fees. If you are successful, the court may order the person you

have sued to pay these costs and fees. If you lose (for example, if the court finds your claim to

be frivolous), the court may order you to pay these costs and fees.

8.5 Questions

If you have any questions about this statement or your rights under ERISA, you should

contact the nearest office of the Employee Benefits Security Administration, U.S. Department

of Labor (listed in your telephone directory), or the Division of Technical Assistance and

Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200

Constitution Avenue N.W., Washington, D.C. 20210.

SECTION 9

SPECIAL RULES FOR GROUP HEALTH BENEFIT PLANS

9.1 Introduction

The following provisions apply to Welfare Programs that offer Group Health Benefit

plans under the Plan. The Company complies with several important laws that affect your

participation and coverage in the Plan. A brief overview of these laws is provided below. Please

contact the Plan Administrator if you need additional information about these laws.

9.2 COBRA Continuation Coverage

The Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) allows you

and your covered Dependents who are Qualified Beneficiaries (see below) to temporarily

continue group health benefit coverage such as medical, dental, vision and Health Flexible

Spending Account Plan benefits beyond the time when it would otherwise end under the Plan.

19

Federal law under COBRA created the right to COBRA continuation coverage. Under

COBRA you may elect to temporarily continue your group health coverage for yourself, and

any covered Dependents who are Qualified Beneficiaries covered by a Welfare Program that

is a group health plan on the day your group health plan participation ceased because of a

Qualifying Event. You and your covered Dependents who are Qualified Beneficiaries are

eligible to elect COBRA continuation coverage even if you have health coverage under another

group health plan. COBRA continuation coverage can also become available to other eligible

Dependents who are Qualified Beneficiaries and who are covered under a Welfare Program

that is a group health plan when they would otherwise lose their group health coverage due to

a Qualifying Event.

This COBRA continuation coverage section, in addition to the initial COBRA

continuation coverage notice that you received upon enrolling in the Plan, provides a brief

overview of your rights and obligations under the continuation coverage provisions of

COBRA. The Plan provides no greater COBRA rights than what the law requires, and this

section should be construed accordingly. Both you and your Dependents should read this

section carefully and keep it with your records as it generally explains COBRA continuation

coverage, when it may be available to you and your family and what you need to do to protect

the right to receive it. For more information about your COBRA continuation coverage rights

and obligations, please call Human Resources.

9.3 Who to Contact

Contact Human Resources to ensure your termination of employment or reduction in

hours has been processed, and that your benefits information has been passed on to the COBRA

Administrator for the Plan. You should continue to call Human Resources or the Claims

Administrator when you have questions about coverage and claims incurred while you were

actively employed.

When your information has been processed, you will receive a letter from the COBRA

Administrator at your home address. Once you receive this letter, you should contact the

COBRA Administrator directly with your questions about your COBRA continuation coverage

eligibility, contributions and benefit claims.

9.4 Eligibility for COBRA Continuation Coverage

COBRA continuation coverage is continuation of group health plan coverage when

coverage would otherwise end because of a life event known as a “Qualifying Event”. The

specific Qualifying Events are listed later in this Section 9. After a Qualifying Event, COBRA

continuation coverage must be offered to each Plan Participant who is a “Qualified

Beneficiary”. You and/or your Dependents could become Qualified Beneficiaries if group

health plan coverage under a Welfare Program of the Plan is lost because of a Qualifying Event.

Qualified Beneficiaries who elect COBRA continuation coverage must pay for COBRA

continuation coverage.

20

9.5 Qualified Beneficiaries

People entitled to COBRA continuation coverage are called Qualified Beneficiaries.

People who may be Qualified Beneficiaries include:

. The covered Employee

. The spouse of a covered Employee

. The dependent children of a covered Employee, including a child who is born to

the covered Employee, or who is placed for adoption with the covered Employee,

during a period of COBRA continuation coverage

In order to be a Qualified Beneficiary, a person must generally be covered under a

group health plan on the day before the Qualifying Event that causes a loss of coverage (such

as a termination of employment, or a divorce from or death of the covered employee). Under

the Plan, a Qualified Beneficiary who elects COBRA continuation coverage must pay for

COBRA continuation coverage.

If it is determined by the Company that an individual is not eligible for COBRA

continuation coverage, the Company will notify the individual of his or her failure to qualify

for COBRA continuation coverage. This notice will explain why the individual in not entitled

to COBRA continuation coverage and will be sent within 14 days after the COBRA

Administrator receives notice of the Qualifying Event.

9.6 Qualifying Events and Maximum Coverage Periods

The Qualifying Events for COBRA continuation coverage and the maximum COBRA

continuation coverage period are shown below.

9.7 Employee COBRA Coverage

If you are a covered Employee and are covered by a group health plan that is a Welfare

Program under the Plan, you may be a Qualified Beneficiary and have the right to continue

coverage if you lose coverage due to the following Qualifying Events:

Qualifying Event Maximum Continuation

Period

Termination of employment (for reasons other

than gross misconduct) 18 months

Reduction in hours of employment resulting in a

loss of eligibility 18 months

9.8 Spouse of an Employee COBRA Coverage

If you are the spouse of a covered Employee and are a covered dependent of a group

health plan that is a Welfare Program under the Plan, you may be a Qualified Beneficiary and

21

have the right to continue coverage if you lose coverage due to the following Qualifying

Events:


Period

The Employee’s termination of employment (for

reasons other than gross misconduct) or a reduction

in the employee’s hours of employment resulting in a

loss of eligibility

18 months

The death of the Employee 36 months

Divorce, legal separation from the Employee 36 months

The Employee’s entitlement to Medicare 36 months

9.9 Dependent Children of an Employee COBRA Coverage

A Dependent child of a covered Employee who is a covered Dependent of a group health

plan that is a Welfare Program under the Plan, may be a Qualified Beneficiary and have the right

to continue coverage if they lose coverage due to the following Qualifying Events:


Period

The Employee’s termination of employment (for

reasons other than gross misconduct) or a reduction in

the employee’s hours of employment resulting in a loss

of eligibility

18 months

The death of the Employee 36 months

The Employee’s divorce or legal separation 36 months

The Employee’s entitlement to Medicare 36 months

Losses of eligible dependent status (e.g., reach

maximum age) 36 months

9.10 Subsequent Qualifying Event

If a subsequent Qualifying Event that is not your termination of employment or

reduction in work hours affecting your eligibility for a group health plan (such as your divorce,

legal separation, your death or your Dependent child ceasing to be eligible under the plan)

occurs during the initial 18 month period of coverage COBRA continuation coverage, that

coverage may be extended for your eligible dependents (who are Qualified Beneficiaries) for

up to a maximum period of 36 months measured from the date of the first Qualifying Event. An

event shall not be a subsequent Qualifying Event unless that event would cause a loss of

coverage under the Plan independent of the initial Qualifying Event. The Qualified Beneficiary

who was the covered Employee will not be eligible for an extension of the maximum 18-month

period of COBRA continuation coverage for a subsequent Qualifying Event.

Notice of a subsequent Qualifying Event must be given to the COBRA Administrator

within a maximum of 60 days in order to extend the coverage. If you fail to inform the COBRA

22

Administrator, you will lose your right to extend your COBRA continuation coverage and this

right will not be reinstated.

9.11 Responses to Information Regarding a Qualified Beneficiary’s Right to

Coverage

Upon request, the Plan will inform health care providers of the Qualified Beneficiary’s

right to continuation coverage. In addition, the Plan will respond to inquiries from health care

providers regarding the Qualified Beneficiary’s right to coverage during the enrollment period

and the right to retroactive coverage if COBRA continuation coverage is chosen.

9.12 Changes in Benefits under COBRA

If you or any Qualified Beneficiaries choose COBRA continuation coverage, your group

health plan benefits will be the same that were in effect at the time you became eligible for

COBRA. If Plan benefits provided to active Employees change, then group health plan benefits

will also change for you and/or your eligible Dependents on COBRA continuation coverage.

You will also be able to change your group health plan benefits option (e.g. PPO to HMO) during

annual enrollment if you are on COBRA continuation coverage.

9.13 Extension of Maximum COBRA Continuation Coverage

An extension of the maximum period of COBRA continuation coverage is available

only if certain Qualifying Events (i.e., the covered Employee dies or gets divorced or legally

separated, or an eligible Dependent child ceases to be an eligible Dependent) occur after a

preceding Qualifying Event that is a termination of employment or reduction of hours.

9.14 Disability Extension

If you (and any other Qualified Beneficiaries) are receiving 18 months of COBRA

continuation coverage due to your Qualifying Event of a termination of employment or a

reduction of hours, your maximum COBRA continuation coverage period may be extended by

11 months to up to a maximum total of 29 months provided the following requirements are

met:

1. The Social Security Administration determines that you (or your covered

Dependent who is a Qualified Beneficiary) are disabled within the meaning of the

Social Security Act;

2. This disability exists as of the date of the Qualifying Event or at any time during

the first 60 days of COBRA continuation coverage following the Qualifying Event;

and

3. The disability must last at least until the end of the 18-month period of COBRA


Notice of the determination of disability under the Social Security Act must be provided

to the COBRA Administrator within the initial 18-month coverage period and within 60 days

after the latest of: (1) the date of the Social Security Administration determination, (2) the date

23

on which the Qualifying Event occurs, (3) the date on which the Qualified Beneficiary loses

coverage, or (4) the date on which the Qualified Beneficiary is informed of the obligation to

provide the disability notice. If you fail to properly notify the COBRA Administrator within the

deadline above, you will lose your right to the extension of COBRA continuation coverage and

this right will not be reinstated. Please refer to the COBRA Notice Requirements provision later

in this SPD for information about proper notice under the Plan.

If the person entitled to the disability extension has non-disabled eligible Dependents

who are Qualified Beneficiaries entitled to COBRA continuation coverage, those non-disabled

Qualified Beneficiaries are also entitled to the disability extension.

If the Social Security Administration determines later that the Qualified Beneficiary is

no longer disabled, the COBRA Administrator must be properly notified within 30 days of the

Social Security Administration’s determination that the disability no longer exists in order to end

the extended coverage. When the disabled Qualified Beneficiary becomes eligible for Medicare

(29 months following the initial date of disability), the COBRA Administrator must be properly

notified to end the extended coverage for the disabled Qualified Beneficiary. Failure to notify

the COBRA Administrator that the Qualified Beneficiary is no longer disabled will result in

termination of COBRA continuation coverage and such coverage will not be reinstated. When

the disabled Qualified Beneficiary becomes entitled to Medicare, the COBRA Administrator

must be notified. Please refer to the COBRA Notice Requirements provision later in this SPD

for information about proper notice under the Plan.

9.15 Medicare Extension

A Qualified Beneficiary, who is entitled to Medicare prior to electing COBRA, has the

right to elect COBRA continuation coverage.

If you experience a Qualifying Event for a termination of employment (for reasons

other than gross misconduct) or a reduction of hours within the 18 month period after you

become entitled to Medicare, your spouse and Dependent children (who are Qualified

Beneficiaries) will become eligible for an extension of COBRA continuation coverage

effective on the date your employment terminates and continuing for 18 months, or, if later,

the date that is 36 months following the date you originally became entitled to Medicare.

However, your own COBRA continuation coverage will not be extended and you will

remain eligible for only a maximum period of 18 months of COBRA continuation coverage.

If you experience a Qualifying Event for termination of employment or a reduction of

hours more than 18 months after you become entitled to Medicare, you, your spouse and

Dependent children (who are Qualified Beneficiaries) will become eligible for COBRA

continuation coverage for a maximum period of 18 months from the date of your Qualifying

Event.

If your spouse or eligible Dependent (who is also a Qualified Beneficiary) is receiving

COBRA continuation coverage and you become entitled for Medicare benefits, your coverage

will end, but COBRA continuation coverage for your spouse or eligible Dependents (who are

24

Qualified Beneficiaries) may be extended for a maximum of 36 months measured from the

date of the initial Qualifying Event.

Please refer to the COBRA Notice Requirements provision later in this SPD for

information about how to give proper notice to the Plan.

9.16 Duration of COBRA Continuation Coverage

The period of COBRA continuation coverage is measured from the date you or your

Qualified Beneficiaries have a Qualifying Event. Coverage is subject to notification and

enrollment requirements. You do not have to provide proof of good health to choose COBRA


Under the COBRA rules there are situations in which a group health plan may stop

making COBRA continuation coverage available earlier than the maximum period. One of

those situations occurs when the Qualified Beneficiary obtains coverage under another group

health plan. However, if the other group health plan limits or excludes coverage for any pre-

existing condition of the Qualified Beneficiary, that person may continue COBRA

continuation coverage until the pre-existing condition exclusion ends, or to the end of the

person’s maximum period of COBRA continuation coverage – whichever comes first.

Other situations in which a Qualified Beneficiary’s COBRA continuation coverage

may be terminated before the maximum period ends include the following:

• The Company no longer provides group health coverage to any of its Employees;

• The premium for the COBRA continuation coverage is not paid on a timely basis;

• The Qualified Beneficiary who was a covered Employee becomes entitled to

Medicare benefits; or

• The Qualified Beneficiary whose disability extended his or her COBRA

continuation period beyond 18 months ceases to be disabled.

In the event that your COBRA continuation coverage is terminated before the end of

the maximum coverage period, the Company will notify you of the termination of coverage as

soon as administratively possible. This notice will explain why and when COBRA continuation

coverage has ended.

9.17 Termination of COBRA Continuation Coverage

COBRA continuation coverage will not be provided beyond whichever of the following

dates is first to occur:

• The date the maximum coverage period expires based upon the Qualifying Event

which entitled you to receive COBRA continuation coverage;

• The date the group health plan is terminated and no other group health plan is

provided to current Employees;

25

• The last day of the month preceding the month for which the covered person fails

to pay the COBRA continuation coverage premium by the last day of the grace

period;

• The date of the Qualifying Event if the initial payment is not received within a

maximum of 45 days after the election of COBRA continuation coverage is made;

• The date the Qualified Beneficiary who was a covered Employee first becomes

entitled to Medicare, including Medicare entitlement due to End Stage Renal

Disease (ESRD), after the person elects COBRA continuation coverage;

• The date the Qualified Beneficiary first becomes covered under another group

health plan (and is no longer subject to, due to changes in the law or otherwise, a

pre-existing condition exclusion or limitation under the other or new group benefit

plan), after the date the Qualified Beneficiary chooses COBRA continuation

coverage; or

• For a disabled Qualified Beneficiary receiving COBRA continuation coverage

during the 11-month disability extension period (and their covered family

members), the date the disabled Qualified Beneficiary receives a final

determination by the Social Security Administration that he or she is no longer

disabled. This final determination shall end COBRA continuation coverage for all

Qualified Beneficiaries as of the later of either: (a) the first day of the month

following 30 days from the final determination date by the Social Security

Administration; or (b) the end of the maximum period of COBRA continuation

coverage without regard to a disability extension.

In the event that your COBRA continuation coverage is terminated before the end of

the maximum coverage period, the COBRA Administrator will notify you of termination of

coverage as soon as administratively possible. This notice will explain why and when COBRA

continuation coverage has ended.

9.18 COBRA Enrollment Requirements

A Qualified Beneficiary must inform the Company of the following:

• Divorce;

• Legal separation;

• Medicare entitlement; or

• Child losing eligible Dependent status.

If this notification is not properly made within 60 days of the Qualifying Event or the

date that group health coverage would be lost under the Plan as a result of the Qualifying Event,

the right to choose COBRA continuation coverage will be lost and will not be reinstated. All

group health plan coverage will be retroactively canceled to the date of the Qualifying Event.

26

A special rule applies if you drop coverage for your spouse, and/or dependent children

because you are planning to divorce or legally separate. In such a case, your spouse, and/or

dependent children who had previously been covered would be entitled to choose COBRA

coverage for up to 36 months from the date that the divorce or legal separation becomes final,

but only if the COBRA Administrator is notified of the divorce or legal separation within 60

days of that date. Retroactive coverage before the date of the divorce or legal separation is not

available. Failure to notify the COBRA Administrator within 60 days will result in a loss of the

right to COBRA continuation coverage and this right will not be reinstated.

The Plan will offer COBRA continuation coverage to each Qualified Beneficiary only

after the Plan Administrator has been properly notified, pursuant to the Plan’s notice

procedures, that a Qualifying Event has occurred. COBRA continuation coverage will be

offered to each person who is a Qualified Beneficiary. If you are a parent or guardian of a

dependent child who is covered under the Plan, then you may elect coverage on behalf of that

eligible dependent child. A Qualified Beneficiary may make separate elections, however, each

Qualified Beneficiary may be required to complete a separate election form.

Human Resources has the responsibility, on behalf of the Plan Administrator, to

properly notify the COBRA Administrator of an Employee’s death, termination of

employment, or reduction in hours causing a loss of eligibility for a Welfare Program that is a

group health plan. When the COBRA Administrator is notified that a COBRA Qualifying

Event has happened, the COBRA Administrator will send a Notice of COBRA Continuation

Coverage Election and an enrollment packet that you can use to elect COBRA continuation

coverage. You have 60 days from the date you would lose coverage (or the date of the COBRA

Administrator’s notification, if later) to respond with all information needed to meet the

Company’s obligation of providing the actual coverage.

If you or your covered dependent (who is also a Qualified Beneficiary) fail to choose

COBRA continuation coverage within 60 days after the COBRA Administrator notifies you

of your right to elect such coverage, you will lose your right to COBRA continuation coverage

and the right will not be reinstated.

Once you have paid your initial COBRA continuation coverage premium, your

COBRA continuation coverage will be effective retroactively to the date of the Qualifying

Event. Until you choose COBRA continuation coverage and make the required payment,

COBRA continuation coverage will not be effective. However, if a question about your

COBRA continuation coverage is asked during the COBRA continuation election period by a

hospital or other health care provider, the inquiring party will be told that enrollment can still

be made to receive retroactive coverage to the date of the Qualifying Event.

Qualified Beneficiaries who are receiving COBRA continuation coverage may make

changes to their coverage option or enrollment category during annual enrollment or at other

times to the same extent as similarly situated active employees. If you want to make a change

during an enrollment period you should contact the Plan Administrator.

27

9.19 COBRA Notice Requirements

For the other Qualifying Events (divorce or legal separation of the Employee and

spouse or a dependent child's losing eligibility for coverage as a dependent child), you (or

someone on your behalf) must notify the Plan Administrator or its designee in writing within

60 days after the Qualifying Event occurs, using the procedures specified below. If these

procedures are not followed or if the notice is not provided in writing to the Plan Administrator

or its designee during the 60-day notice period, you, your spouse or dependent child who loses

coverage will not be offered the option to elect continuation coverage. You must send this

notice to the Plan Administrator or its designee.

Event Requiring

Notice

Form of

Notice

Required

Information Required: Deadline for

Notice

Divorce or Legal

Separation

Written Name, address and

phone number of

employee; description of

event and documentation

if required, name and

address of Dependent

child or spouse if

applicable.

Within 60 days

from date of final

court judgment.

Dependent

becomes ineligible

under the plan


phone number of





child or spouse if

applicable.

Within 60 days

from date your

dependent first

becomes ineligible.

Medicare entitlement Written Name, address and

phone number of





child or spouse if

applicable.

Within 60 days

from date of

entitlement and

before the end of

the 18-month

COBRA

continuation

coverage period.

28

Event Requiring

Notice

Form of

Notice

Required

Information Required: Deadline for

Notice

Determination of

disability


phone number of





child or spouse if

applicable.

Within 60 days of

disability

determination and

before the end of

the maximum 18-

month COBRA

continuation

coverage period.

Determination of non-

disability status


phone number of





child or spouse if

applicable.

Within 30 days the

Social Security

Administration’s

determination of

non-disability.

Marriage Written Name, address and

phone number of





child or spouse if

applicable.

Within 31 days

from the date of

marriage.

Birth, Adoption or

Placement for

Adoption

Written or

Internet or

phone

Name, address and

phone number of





child or spouse if

applicable.

Within 31days from

date of the event.

Failure to properly provide the required notice may result in loss of COBRA

continuation right and, if lost, this right will not be reinstated.

The COBRA Administrator is the designated recipient for all COBRA continuation

coverage notices. They may be reached at:

Businessolver, Inc.


P.O. Box 310512


877-547-6257

29

9.20 Special Enrollment Events and COBRA

If you have a child born to, adopted or placed for adoption with you during COBRA

continuation coverage that you have elected, you must notify the COBRA Administrator and

elect coverage for the child within 31 days of the child's birth, adoption or placement for

adoption. If you get married during your period of COBRA continuation coverage, you may

add your new spouse to your COBRA continuation coverage if you notify the COBRA

Administrator within 31 days of the date of the marriage. A new Dependent may become a

participant under this COBRA continuation coverage for the remainder of your continuation

period (18, 29 or 36 months, depending on the Qualifying Event).

9.21 HIPAA and COBRA

In considering whether to elect COBRA continuation coverage, you should take into

account that a failure to continue your group health coverage may affect your future rights

under Federal law. First, you can lose the right to avoid having pre-existing condition

exclusions applied to you by other group health plans if you have more than a 63-day gap in

health plan coverage and election of COBRA continuation coverage may help you avoid such

a gap. Second, you will lose the guaranteed right to purchase individual health insurance

policies that do not impose a pre-existing condition exclusion if you do not get COBRA

continuation coverage for the maximum period available to you. Finally, you should take into

account that you have special enrollment rights under federal law. You have the right to request

special enrollment in another group health plan for which you are otherwise eligible (such as

a plan sponsored by your spouse’s employer) because of a Qualifying Event listed above. You

will also have the same special enrollment right at the end of COBRA continuation coverage

if you elect and exhaust COBRA continuation coverage for the maximum time available to

you.

9.22 Cost of COBRA Coverage

You must pay the full cost (i.e. both the Company and Employee cost) for COBRA

continuation coverage plus a 2% administrative fee. The Company will determine this cost,

but it generally cannot exceed 102% of the Plan's cost for providing coverage to similarly

situated covered Employees and their covered Dependents. COBRA premiums are subject to

change annually. If you and your covered Dependents who are Qualified Beneficiaries are

receiving an additional 11 months of COBRA continuation coverage due to disability, the

Company will determine this cost which will not exceed 150% of the Plan's cost for providing

coverage during the additional 11 months of COBRA continuation coverage, if the disabled

Qualified Beneficiary is covered by the COBRA continuation coverage.

9.23 COBRA Payments

Once you choose COBRA continuation coverage, a Qualified Beneficiary has 45 days

from the date of election to pay the first month and all retroactive premiums for the chosen

coverage. Although coverage is retroactive to the date of the initial Qualifying Event, no

COBRA benefits will be paid until the COBRA Administrator receives this first payment. If

payment is not received within the 45-day period, then coverage will either be revoked

30

retroactively or it will not become effective and you will lose your right to COBRA

continuation coverage. Your right to COBRA continuation coverage will not be reinstated.

All subsequent payments are due on the first day of the month for coverage during that

month. You are permitted a 30-day grace period for payment of required COBRA premiums.

The 30-day grace period does not apply to the initial COBRA premium payment. COBRA

premiums are paid on an after-tax basis. If you do not make payments for coverage by the last

day of the grace period, your COBRA continuation coverage will end as of the last day of the

prior month and will not be reinstated. The COBRA Administrator will notify you if your

COBRA continuation coverage is terminated for non-payment before the end of the maximum

COBRA continuation coverage period. This notice will explain why and when COBRA

continuation coverage has ended.

COBRA premiums can be paid by you or by a third party on your behalf. Please note

these rules for COBRA premium payments:

• Late or reminder notices will not be sent for payments that have not been made.

• Once COBRA continuation coverage is terminated, it cannot be reinstated.

• Partial payments will not be accepted, however, your COBRA continuation

coverage will not terminate if your monthly premium payment is short by a small

amount (the lesser of $50 or 10% of the required COBRA premium payment). In

case of a shortage, you will be notified of the balance due and you will have 30

days to pay this amount.

• Payments that are returned by the bank for insufficient funds will result in

termination of your COBRA continuation coverage, unless a replacement in the

form of a cashier’s check, certified check or money order is made within the

applicable grace period.

• Payments should be mailed to the COBRA Administrator address. Payments are

considered made on the date that the payment is mailed. It is your responsibility to

pay your COBRA premiums when they are due.

You may be eligible for state or local assistance to pay the COBRA premium. For more

information, contact your local Medicaid Office or the Office of your State Insurance

Commissioner.

9.24 Trade Assistance Act of 2002

The Trade Assistance Act of 2002 created a tax credit for certain individuals who

become eligible for trade adjustment assistance and for certain retired employees who are

receiving pension payments from the Pension Benefit Guaranty Corporation (PBGC) (“eligible

individuals”). Under the new tax provisions, eligible individuals can either take a tax credit or

get advance payment of 65% of premiums paid for qualified health insurance, including

COBRA continuation coverage. If you have questions about these new tax provisions, you may

31

call the Health Coverage Tax Credit Customer Contact Center toll-free at (866) 628-4282.

TTD/TTY callers may call toll-free at (866) 626-4282.

9.25 Contact Information for the COBRA Administrator and Plan Administrator

Questions concerning a Group Health Benefit plan offered under the Plan should be

addressed to the Plan Administrator. Questions concerning your COBRA continuation

coverage rights should be addressed to the COBRA Administrator. For more information about

your rights under ERISA, including COBRA, HIPAA and other laws affecting Group Health

Benefit plans, contact the nearest Regional or District Office of the U. S. Department of

Labor’s Employee Benefits Security Administration (EBSA) in your area or visit the EBSA

website at www.dol.gov/ebsa.

You may reach the Plan Administrator at:

Hologic

250 Campus Drive


You may reach the COBRA Administrator at:

Businessolver, Inc.


P.O. Box 310512


877-547-6257

9.26 Keep the Plan Informed

In order to protect your and your eligible Dependents’ rights, you should keep the

Company informed of any changes in the address of yourself and your eligible Dependents.

You should also keep a copy of all COBRA notices that you receive or send to the Plan

Administrator or COBRA Administrator.

9.27 Health Insurance Portability and Accountability Act

The Health Insurance Portability and Accountability Act (“HIPAA”), as amended,

primarily deals with how an employer can enforce eligibility and enrollment for health care

benefits. Examples of some of the requirements of HIPAA include:

4. Limitations under the Group Health Benefit plan with respect to pre-existing

conditions;

5. Special enrollment periods available during the Plan Year to you and your eligible

Dependents who declined coverage because you or your eligible Dependent had

other coverage but subsequently lose that other coverage—you must enroll within

31 days after losing group health coverage.

6. If you are not enrolled in the Plan and you get married, give birth, or adopt a child

(or a child is placed with you for adoption), you can enroll yourself and your

eligible Dependents within 31 days of the event.

http://www.dol.gov/ebsa.

http://www.dol.gov/ebsa.

32

The Plan will not base eligibility rules or waiting periods on any of the following: health

status, mental or physical medical condition, genetic information and evidence of insurability

or disability. Evidence of insurability will not be required when health care coverage is

requested during a special enrollment period or during your initial or annual enrollment period.

However, the Plan may continue to provide for the exclusion of specified health conditions

and apply lifetime maximums on either specific benefits or all benefits provided under the

Plan. These restrictions also will not preclude the Plan from applying differing benefit levels,

benefit schedules or premium rates in certain situations as provided under HIPAA.

9.28 HIPAA Privacy Rights

The Plan will comply with the privacy regulations under HIPAA. These regulations set

national standards for the protection of certain personal health information. This information,

referred to as “protected health information,” is information that (i) could identify a Participant

(or to which there is a reasonable basis to determine the identity of the Participant) and (ii)

relates to the Participant’s past, present, or future physical or mental condition.

As required under HIPAA, the Plan will not use or disclose your protected health

information for purposes other than treatment, payment or healthcare operations, without your

written authorization or as required by law.

“Treatment” includes the provision, coordination, or management of health care

providers.

“Payment” includes activities by the Plan to obtain premiums or determine or fulfill

the Plan’s obligation for coverage, including determinations of eligibility or coverage,

adjudication or subrogation of claims, billing, claims management, collection activities, health

care data processing, review of medical necessity, review of appropriateness of care or

justification of charges, and utilization review activities.

“Healthcare Operations” include conducting quality assessment and improvement

activities, case management and care coordination, reviewing and evaluating Plan

performance, securing contracts, conducting or arrangement for medical review or auditing

functions and business planning and development.

Unless a Participant gives the Plan written authorization, the Plan may disclose protected

health information to the Company as Plan Administrator only for Plan administration and

enrollment purposes and only if there is adequate separation between the Company as Plan

Administrator and as Employer. In addition, “Summary Health Information” may be disclosed

by the Plan to the Company as the Employer for purposes of obtaining premium bids for health

insurance coverage under the Plan or modifying, amending,

or terminating the Plan. Prior to receiving any protected health information, the Company must

certify to the Plan that adequate separation exists.

All protected health information used, requested or disclosed is limited to the minimum

amount necessary to accomplish the intended purpose(s) of the disclosure.

33

As a Participant in the Plan, you have certain rights with respect to your protected health

information, including the right to inspect and copy your medical records, request amendment

or correction to your records, restrict the use or disclosure of your protected health information,

and request an accounting of the uses and disclosures of your protected health information.

The Plan has included policies and procedures specifically designed to safeguard your

protected health information when it is in electronic format. This includes administrative,

physical and technical safeguards to ensure your protected health information cannot be

inappropriately accessed while it is stored and transmitted to insurers and others that administer

the Plan. This includes:

• Ensuring that adequate separation exists between your protected health information

maintained by the Plan and your Employer and this separation is supported by

appropriate security measures.

• Ensuring that insurance carriers and claims administrators agree to an appropriate

level of information security when handling your electronic protected health

information.

The Plan reserves the right to change privacy and security practices and to make the

new provisions effective for all protected health information maintained. Should the privacy

and/or security practices change, a revised notice will either be mailed or electronically

transmitted to you.

A Notice of Privacy Practices containing a description of these uses and disclosures of

protected health information, your rights, the Plan’s duties and complaint procedures has been

sent by the Company to all Plan Participants. A copy of the notice is available upon request

from the Company. For more information regarding your privacy rights under HIPAA, please

contact Human Resources.

9.29 Mental Health Parity Act

Medical coverage under the Plan will comply with the Mental Health Parity Act

(“MHPA”), as amended. The annual and lifetime limits on mental health benefits will not be

less than the annual and lifetime Plan limits on other types of medical and surgical services.

Under the Plan, mental health benefits will be subject to cost-sharing, limits on the number of

visits or days of coverage, and other rules that relate to the amount, duration and scope of

mental health benefits.

9.30 Newborns’ and Mothers’ Health Protection Act

The Plan shall comply with the Newborns’ and Mothers’ Health Protection Act

(“NMHPA”), as amended, with respect to a benefit offered under this Plan that provides Group

Health Benefits. Under NMHPA, the Plan generally may not restrict benefits for any hospital

length of stay in connection with childbirth for the mother or the newborn child to less than 48

hours following a vaginal delivery or 96 hours following a cesarean section delivery. However,

the Plan or the insurer may pay for a shorter stay if the attending provider, after consultation

with the mother, discharges the mother or newborn earlier. The Plan may not set the level of

34

benefits or out-of-pocket costs so that any later portion of the 48-hour (or 96 hour) stay is

treated in a manner less favorable to the mother or newborn than any earlier portion of the stay.

The Plan may not require that a provider obtain authorization for prescribing a length of stay

of up to 48 hours (or 96 hours). However, to use certain facilities or to reduce your out-of-

pocket costs, you may be required to obtain pre-admission certification. For information on

whether the Plan requires pre-admission certification, please refer to the Welfare Program

materials, or contact the insurer directly.

9.31 Women’s Health and Cancer Rights Act

The Plan shall comply with the Women’s Health and Cancer Rights Act of 1998

(“WHCRA”), as amended. Medical coverage under the Plan will cover certain breast

reconstructive benefits in connection with a mastectomy. If you have a mastectomy, benefits

are available in a manner determined in consultation with you and your physician for: (1)

reconstruction of the breast on which the mastectomy was performed, (2) surgery and

reconstruction of the other breast to produce a symmetrical appearance and (3) prosthesis and

treatment of physical complications for all stages of mastectomy, including lymph edemas.

Such coverage is subject to all the terms of the Plan, including relevant deductibles, co-

insurance, and pre-certification and utilization review provisions that are consistent with those

that apply to other benefits under the Plan.

9.32 Family and Medical Leave Act

The Plan will comply with the Family and Medical Leave Act of 1993 (“FMLA”), as

amended. During FMLA leave, you may choose to cancel your benefits, or you may choose

to have your Group Health Benefit coverage continued on the same basis as if you had

continued working. If you choose to continue coverage while on FMLA leave, you must

continue to pay for your contributions for Group Health Benefit coverage under the Plan.

Continuation of benefits coverage for FMLA leave requested for family or medical reasons is

limited, in most cases, to 12 work weeks of pay in any 12-month period of time. However, an

eligible employee who is a spouse, son, daughter, parent or next of kin of a covered service-

member may take up to 26 workweeks of leave in a 12-month period to care for the service-

member, in accordance with the Employer’s approved leave of absence policies and

procedures.

If you do not return from FMLA leave or extend your leave, your coverage may

terminate and you may be eligible to choose COBRA continuation coverage. For more

information regarding the FMLA and the Company’s Leave of Absence guidelines, please

contact Human Resources.

9.33 Military Leave

The Plan will comply with the Uniformed Services Employment and Re-employment

Rights Act of 1994 (“USERRA”), as amended. Under USERRA, your coverage continues for

up to 24 months while you are on active duty with the armed forces. If, however, you fail to

apply for return to employment as required under USERRA, your coverage will end the next

day.

35

In order to continue Group Health Benefit coverage, you must pay both your share and

the Company’s share of the cost of the Group Health Benefit coverage you wish to continue

while on leave. Payment should be made to the Company, as appropriate.

For more information regarding your Group Health Benefit coverage during and/or

after military leaves of absence, please contact Human Resources.

9.34 Qualified Medical Child Support Orders

The Plan will comply with the rules relating to Qualified Medical Child Support Orders

(“QMCSO”). A QMCSO is a court or agency order that creates, recognizes, or assigns to a child

of an eligible Employee the right to receive Group Health Benefit coverage available under the

Plan and that meets the requirements of the law to be “qualified.”

The Plan uses the following rules related to children and QMCSOs, and it provides

Group Health Benefits in accordance with the applicable requirements of any QMCSO. To be

qualified, a medical child support order must comply with state and federal laws by including:

• the name and last known mailing address (if any) of both the eligible Employee and

the child covered by the order except that, to the extent provided in the order, the

name and mailing address of an official of a state or a political subdivision thereof

may be substituted for the mailing address of any such alternate recipient (or legal

representative);

• a reasonable description of the type of Group Health Benefit coverage to be

provided by the Plan for each child (or the manner in which the type of coverage

will be determined); and

• the period of Group Health Benefit coverage to which the order applies.

In addition, a medical child support order will generally not be considered qualified if

it requires the Plan to provide certain benefits or options which are not otherwise provided by

the Plan. The Company will notify you of the receipt of a court order and the procedures for

determining whether it meets the requirements of a QMCSO.

The Plan has final, discretionary authority to determine whether a medical child support

order qualifies as a QMCSO.

The procedures used to determine if a medical child support order is qualified are

available to the participant, free of charge, upon request to the Plan Administrator.

9.35 National Medical Support Notice Deemed to be a QMCSO

An appropriately completed standardized National Medical Support Notice (“Notice”)

that complies with the Child Support Performance and Incentive Act of 1998 will be deemed

to be a QMCSO if it meets the requirements of a QMCSO described above.

If a Notice is issued for a child of an eligible Employee of the Company who is not the

custodial parent of the child, the Plan Administrator, within 40 days business days after the

36

date of the Notice, will notify the state agency issuing the Notice with respect to such child

whether coverage of the child is available under the terms of the Plan, and if so:

. Whether such child is covered under the Plan; or

7. Either the effective date of the coverage or, if necessary, any steps to be taken by

the custodial parent (or state agency) to make the coverage effective.

The Plan Administrator will provide the custodial parent (or the state agency) with a

description of the Group Health Benefit coverage available and any forms or documents

necessary to make such coverage effective.

The Plan has final, discretionary authority to determine whether a Notice qualifies as a

QMCSO. The procedures used to determine if a medical child support order is qualified are

available to the Participant, free of charge, upon request to the Plan Administrator.

The procedures used to determine if a Notice is a QMCSO are available to you, free of

charge upon request from Human Resources.

9.36 Adopted Children and Children Placed for Adoption

The Plan will provide benefits to adopted children and children placed for adoption on the same

basis as natural children of eligible Employees (even prior to the adoption becoming final). A

child will be considered placed for adoption with you if you have assumed a legal obligation for

total or partial support of the child in anticipation of adoption of the child. For this reason, if you

have a child placed with you for adoption by an adoption agency or other entity, you must provide

the Plan Administrator with documentation (e.g., signed court order) that the adoption agency or

other entity had legal custody of the child on the date that the child was placed with you for

adoption. The Plan Administrator will determine within a reasonable period of time, whether a

child has been placed for adoption and is an eligible Dependent for benefits under the Plan. The

Plan Administrator has final discretionary authority to determine whether a child has been placed

for adoption.

9.37 Michelle’s Law

The Plan shall comply with Michelle’s Law (“Michelle’s Law”) with respect to medically

necessary leaves of absence that occur on or after the effective date of Michelle’s Law to the

extent to which the Plan is subject. If a Welfare Program offered under the Plan provides for

Group Health Benefit Plan eligibility and coverage of a dependent child who is enrolled as a

full time student in a post-secondary educational institution of higher education (including

colleges and universities) immediately before the first day of the medically necessary leave of

absence, the Plan shall permit eligibility and coverage of such dependent child to continue in

the same manner from the earlier of the date that is one (1) year from (i) the first day of the

medically necessary leave of absence or (ii) the date on which coverage would otherwise

terminate for loss of eligibility under the Group Health Benefit Plan.

37

9.38 Genetic Information Nondiscrimination Act

The Plan will comply with the Genetic Information Nondiscrimination Act (GINA). The Plan

shall not discriminate against an Employee or Dependent on the basis of an individual’s genetic

information. Genetic information is defined as information about an individual’s genetic test

information about the genetic tests of an individual’s family members or information about the

manifestation of a disease or disorder in an individual’s family members. Genetic information

includes any request for, receipt of, genetic services (including genetic testing, counseling or

education) or participation in clinical research which includes such services, by the individual

or family member.

9.39 Patient Protection and Affordable Care Act and the Reconciliation Act

The Plan shall comply with the provisions of the Patient Protection and Affordable Care Act,

the Reconciliation Act (hereinafter both are collectively referred to as "ACA") and certain

other provisions of applicable law and the applicable regulations that are generally effective

after December 31, 2009 ("Applicable Law"). The Plan intends good faith compliance with the

requirements of the ACA and Applicable Law and is to be construed in accordance with same.

This Section shall supersede the provisions of the Plan to the extent those provisions are

inconsistent with the provisions of this Plan, ACA and Applicable Law.

9.40 Other Laws

The Plan shall comply with all other state and federal laws to the extent not preempted by

ERISA and to the extent such laws are applicable to a Welfare Program. Such laws shall

include, but not be limited to the Americans with Disabilities Act (“ADA”), the Pregnancy

Discrimination Act (“PDA”) and the Small Business Job Protection Act (“SBJPA”).

SECTION 10

CLAIMS PROCEDURES

10.1 Introduction

The following Section 10 pertains to claims procedures for all Welfare Program claims

or appeals (including medical, dental, vision, life and disability claims) under the Plan. If a

specific Welfare Program document has claim procedures governing the benefits offered under

that program, then those claim procedures will control rather than the claim procedures

contained in this Section 10.

For the purposes of this Section 10, any reference to “you” also refers to an authorized

representative or provider designated by you to act on your behalf, unless otherwise noted.

For purposes of the determination of benefits provided by insured plans, the insurance

carrier is the named fiduciary under the Plan, with the full power to interpret and apply the

terms of the Plan as they relate to the benefits provided under the applicable insurance policy.

To obtain benefits from an insurance carrier, you must follow the claims procedures under the

applicable insurance carrier contract, which may require you to complete, sign and submit a

written claim on the insurer’s claim form. The insurance carrier will decide a claim in

accordance with its reasonable claims procedures, as required by ERISA. The insurance carrier

38

has the right to secure independent medical advice and to require such other evidence, as it

deems necessary in order to decide a claim. If the insurance carrier denies a claim, in whole or

in part, you will receive a written notification setting forth the reason(s) for the denial. If a

claim is denied, you may appeal to the insurance carrier for a review of the denied claim. The

insurance carrier will decide the appeal in accordance with its reasonable claims procedures,

as required by ERISA. The Company is not responsible for any claim decisions rendered by

an insurance carrier.

For purposes of the determination of self-funded benefits, the Claims Administrator of

the self-funded Welfare Program is the named fiduciary of the Plan, with the full power to

interpret and apply the terms of the Plan as they relate to the benefits provided under the

applicable Welfare Program. To obtain benefits from a Claims Administrator, you must follow

the claims procedures under the applicable Claims Administrator’s contract or established under

the Plan, which may require you to complete, sign and submit a written claim on the Claims

Administrator’s claim form. The Claims Administrator will decide a claim in accordance with

its reasonable claims procedures, as required by ERISA. The Claims Administrator has the right

to secure independent medical advice and to require such other evidence, as it deems necessary

in order to decide a claim. If the Claims Administrator denies a claim, in whole or in part, you

will receive a written notification setting forth the reason(s) for the denial. If a claim is denied,

you may appeal to the insurance carrier for a review of the denied claim. The Claims

Administrator will decide the appeal in accordance with its reasonable claims procedures, as

required by ERISA. The Company is not responsible for any claim decisions rendered by the

Claims Administrator unless the Company is the Claims Administrator.

10.2 Timing and Process of Filing a Claim

The Plan Administrator, Claims Administrator or insurance carrier that has fiduciary

authority to make a claim decision (the “Decision Maker”) may no longer pend your claim on

the basis that your claim submission is incomplete. Federal law now mandates that a decision

must be rendered within certain time periods that begin to run when the Decision Maker

receives your claim, even if the information important to making a decision on your claim has

not been received.

If the Decision Maker denies your claim, you must complete all administrative review

steps available through the Claims Administrator or insurance carrier before any appeal to the

Plan Administrator is permitted and, in some cases, appeal to the Plan Administrator is no

longer available.

The claims procedures do not cover casual or general inquiries regarding eligibility or

particular Plan benefits that may be provided under the Plan. If you want your inquiry to

constitute a claim or an appeal, you must follow the procedures contained in this SPD. For

more details on the filing of specific types of claims, including claim-filing deadlines, please

refer to the applicable section of this SPD.

The timeframe for a decision on your Welfare Program claim will depend on the type

of benefit claim you are submitting, whether you submit a complete claim, and whether an

extension is required to make a decision on your claim.

39

10.3 Initial Claims Procedures – Complete Claims

A claim is considered complete when it contains all of the necessary information

(including supporting documentation, if applicable) required to render a decision and is

submitted within the prescribed timeframe under a Plan’s reasonable claims procedures. If you

fail to submit a complete claim, the Decision Maker may notify you of the necessary

information required to render a decision on your claim.

10.4 Initial Health Claims Procedures – Urgent Health Care Claims

An urgent health care claim is a claim for medical care or treatment that, if not received,

could jeopardize the claimant’s health or life, their ability to function at maximum level, or

could subject claimant to severe pain, or is deemed urgent by a doctor with knowledge of the

claimant’s medical condition.

If you submit a claim that your physician or other health care provider has determined

is “urgent”, you can expect a decision within 72 hours from the time the Decision Maker

receives your claim. The Decision Maker will notify you of its decision whether your claim is

approved or denied. Such notification will contain the required information outlined below.

Except as otherwise provided in this Section 10, the Decision Maker may not extend the

decision time in the case of urgent care claims.

If you submit an incomplete claim, you may receive a request for more information from

the Decision Maker within 24 hours from the time the Decision Maker receives your request for

benefits under the Plan. The notice will describe any information necessary to render a decision

on your claim and explain why it is necessary. You will then have 48 hours to provide the

additional information. The decision deadline will be suspended until the earlier of the end of the

48-hour period or the Decision Maker’s receipt of the requested information. The Decision

Maker will make its decision not later than: (i) 48 hours after the Decision Maker’s receipt of the

requested information or (ii) the end of the period given to provide the information, whichever

is earlier. Notification of decisions may be made orally, provided that written notification is also

provided within three days of the oral communication. If your claim is denied, the notification

will contain the applicable information outlined below.

10.5 Initial Health Claims Procedures – Pre-Service Health Claims

A pre-service health claim is a claim for a benefit under a Group Health Benefit plan

that, under the terms of the Plan, conditions the receipt of the benefit, in whole or in part, on

approval of the benefit before obtaining medical care (for example pre-authorization or pre-

certification for surgery).

If you submit a complete pre-service health claim, you can expect a decision within 15

days from the time the Decision Maker receives your claim. The Decision Maker may extend

this time period by 15 days if special circumstances arise that are beyond the control of the

Decision Maker. If an extension is required, the Decision Maker will notify you prior to the

end of the initial 15-day time period, explain the reason for the extension, and give an

approximate decision date. The Decision Maker will notify you in writing of its claim decision.

40

Such notification shall be made in writing, and it will contain the applicable information

outlined below.

If you submit an incomplete claim, you may receive a request for more information

from the Decision Maker within five days from the time the Decision Maker receives your

claim. The notice will describe the information necessary to render a decision on your claim

and explain why it is necessary. You will then have 45 days to provide the requested

information. The decision deadline will be suspended until the earlier of the end of the 45-day

period or the Decision Maker’s receipt of the requested information.

If the requested information is received before the end of the 45-day period, the

suspension of the initial 15-day claim determination period will be lifted and the Decision

Maker will render a decision within the time remaining of the initial 15-day decision period.

If the requested information is not received by the end of the 45-day period, then a decision on

your claim will be made at the end of the 45-day period. The Decision Maker will notify you

in writing of its claim decision. Such notification will be made in writing, and it will contain

the applicable information outlined below.

10.6 Initial Health Claims Procedures – Post-Service Health Claims

A post-service health claim is a claim for a benefit under a Group Health Benefit plan

that is not a pre-service health claim or an urgent care claim. In other words, it is a claim for

reimbursement or consideration of payment for the cost of medical care that has already been

rendered (including a request for reimbursement from a Health Flexible Spending Account).

If you submit a complete post-service health claim, you can expect a decision within

30 days from the time the Decision Maker receives your claim. The Decision Maker may

extend this time period by 15 days if special circumstances arise that are beyond the control of

the Decision Maker. If an extension is required, the Decision Maker will notify you prior to

the end of the initial 30-day time period, explain the reason for the extension, and give an

approximate decision date. The Decision Maker will notify you of the claim decision in writing.

If your claim is denied the Decision Maker will notify you of the claim decision in writing and,

such notification will contain the required applicable information outlined below.


from the Decision Maker within 30 days from the time the Decision Maker receives your claim.

The notice will describe the information necessary to render a decision on your claim and

explain why it is necessary. You will then have 45 days to provide the requested information.

The decision deadline will be suspended until the earlier of the end of the 45-day period or the

Decision Maker’s receipt of the requested information.


suspension on the time frame for decision is lifted and the Decision Maker will render a

decision within the time remaining of the initial 30-day period. If the requested information is

not received within the 45-day period, then a decision on your claim will be made at the end

of the 45-day period. If your claim is denied, the Decision Maker will notify you of the claim

decision in writing and such notification will contain the required applicable information

outlined below.

41

10.7 Initial Health Claims Procedures – Concurrent Health Care Claims

Special rules apply where the Decision Maker of your Group Health Benefit coverage

option has approved an ongoing course of treatment either for a specific period of time or for

a specific number of treatments.

A reduction or termination of the course of treatment before the end of the approved

time period or number of treatments will be considered a claim denial (except when the Plan

is amended or terminated). In this case, the Plan will notify you in advance so you can appeal

the decision before the benefit is reduced or terminated. If your claim is denied, the notice of

claim determination will include the applicable information outlined below.

You may request to extend the course of treatment beyond the approved time period or

number of treatments. If this involves urgent care, the Decision Maker will notify you whether

your request has been approved or rejected within 24 hours of receiving your request, as long

as you make your request at least 24 hours before the approved time period or number of

treatments expires. A request to extend an urgent care course of treatment beyond the approved

time period or number of treatments that is received less than 24 hours before the approved

time period or number of treatments expires will be treated as an urgent care claim, subject to

the procedures outlined above. The notice of claim determination will be provided in

accordance with the urgent care claim procedures. If the request to extend a course of treatment

beyond the approved time period or number of treatments involves a pre-service or post-service

health claim, then the claim will be treated as such, subject to the claims procedures outlined

above.

10.8 Initial Claims Procedures – Disability Claims

If you submit a complete claim for short-term or long-term disability, the Decision

Maker will make a decision within 45 days from the time the Decision Maker receives your

claim. The Decision Maker may extend this time period by 30 days if special circumstances

arise that are beyond the control of the Decision Maker. If an extension is required, the

Decision Maker will notify you prior to the end of the initial 30-day time period, explain the

reason for the extension, and give an approximate decision date. The Decision Maker may

further extend this time period by another 30 days, but must notify you before the end of the

initial 30-day extension. The Decision Maker will notify you of the claim decision in writing.

If your claim is denied, such notification will contain the applicable information outlined

below.


from the Decision Maker within 45 days from the time the Decision Maker receives your claim.

The notice will describe the information necessary to render a decision on your claim and

explain why it is necessary. You will then have 45 days to provide the requested information.

The decision deadline will be suspended until the earlier of the end of the 45-day period or the

Decision Maker’s receipt of the requested information.


suspension on the time frame for decision is lifted and a decision will be rendered within the

time remaining of the initial 45-day period. If the requested information is not received before

42

the end of the 45-day period, then a decision on your claim will be made at the end of the 45-

day period. If your claim is denied, such notification will contain the applicable information

outlined below.

10.9 Initial Claims Procedures – Other Claims

For the purposes of this Section 10, procedures regarding “other” claims will apply to

any claim for a benefit under a Welfare Program that is unrelated to a claim for a Group Health

Benefit care or disability benefit, such as a claim for:

. Life insurance benefits; or

. Accidental death & dismemberment (AD&D) insurance benefits.

In general, you can expect a decision within 90 days from the time the Decision Maker

receives your claim. The Decision Maker may extend this time period by 90 days if special

circumstances exist that are beyond the control of the Decision Maker. If an extension is

required, the Decision Maker must notify you prior to the end of the initial 90-day time period,

explain the reason for the extension, and give an approximate decision date. Either way, the

Decision Maker will notify you of the claim decision. If the claim is denied, such notification

will contain the required information outlined below.

10.10 Initial Claims Procedures – Eligibility Claims

For the purposes of this Section 10, the following procedures relating to a claim for

eligibility under the Plan or any Welfare Program.

In general, you can expect a decision within 90 days from the time the Decision Maker

receives your claim. The Decision Maker may extend this time period by 90 days if special

circumstances exist that are beyond the control of the Decision Maker. If an extension is

required, the Decision Maker must notify you prior to the end of the initial 90-day time period,

explain the reason for the extension, and give an approximate decision date. Either way, the

Decision Maker will notify you of the claim decision. If the claim is denied, such notification

will contain the required information outlined below.

10.11 Information Provided for Denied Claims

Subject to the notification requirements outlined above, you will receive a written or

electronic notice of your claim determination. The notice will be written in a manner that is

intended to be understandable and will contain the following information applicable to your

claim:

• The specific reason(s) for the denial;

• The specific reference to pertinent Plan, Welfare Program documents and/or SPD

provisions upon which the denial was based;

• A description of any additional information or material necessary for the claim to be

approved, and an explanation of why such information or material is necessary;

43

• A description of the appeal procedures and the time limits applicable to your claim;

• A statement of your right to bring civil action under section 502(a) of ERISA

following an adverse benefit determination on review;

• If the denial is based on an internal rule, protocol, procedure, or guideline relied

upon in making the adverse decision, an explanation of such rule, protocol,

procedure, or guideline or a statement that explains your right to receive a copy of

such information free of charge upon request;

• If the denial was based on a medical necessity or experimental, investigational, or

unproven treatment or similar exclusion or limit, either an explanation of such

judgment or a statement that an explanation is available upon request and is free of

charge; and

• In the case of an urgent care claim, you will receive information regarding the

expedited appeal process applicable to your claim. This notice may be provided

orally, but it must be followed with a written notice within three days of oral

notification.

Certain insured benefits may have voluntary appeal provisions that allow you to appeal

your denied claim to outside parties. For more information regarding the availability of

voluntary appeal procedures, please contact the appropriate Decision Maker directly.

In the case of a denial of your claim for short-term or long-term disability benefits, the

notice of your claim determination will also include the following information:

• A discussion of the decision, including an explanation of the basis for disagreeing with or

not following: (i) the views presented to the Plan of health care professionals treating

you and vocational professionals who evaluated you; (ii) the views of medical or

vocational experts whose advice was obtained on behalf of the Plan in connection with

the denial, without regard to whether the advice was relied upon in making the denial;

and (iii) a disability determination regarding you presented by you to the Plan made by

the Social Security Administration;

• Either the specific internal rules, guidelines, protocols, standard or other similar criteria

of the Plan relied upon in making the adverse determination or, alternatively, a statement

that such rules, guidelines, protocols, standards or other similar criteria of the Plan do not

exist; and

• A statement that you are entitled, upon request and free of charge, reasonable access to

and copies of all documents, records, and other information relevant to your claim.

10.12 Claims Appeal Procedures

If, after you have completed all of the claims review steps provided by the appropriate

Decision Maker, you still feel that your claim is being denied in error, you may request an appeal

of the denied claim in writing within the timeframes outlined below. If you are requesting an

44

appeal of an urgent care claim, you or your authorized representative may submit your appeal

via telephone, electronic or other expedited method of delivery other than in writing. The

timeframe for a decision on your request for appeal will depend on the type of claim you are

appealing. You may request an appeal of your claim if it is wholly or partially denied.

To receive a form on which to file your appeal, you must contact the Plan Administrator.

Every claim appeal under the Plan will be given full and fair review by a different Decision

Maker than the person who made the claim decision initially (the “Decision Maker on Appeal”).

The Decision Maker on Appeal will not be the same person that made the initial claim

determination nor will it be that person’s subordinate. The Decision Maker on Appeal will review

all of the materials used to reach the initial claim decision, in addition to any additional

comments, documents, records, and other materials that you submit in the appeal process. The

Decision Maker on Appeal will make an independent determination and will not give deference

to the initial decision. The Decision Maker on Appeal will provide reasonable access to copies

of all document, records, and other information relevant to the claim upon request. Relevant

information means information:

8. Relied upon in the benefit determination;

9. Submitted, considered, or generated in the course of benefit or eligibility

determination;

10. Demonstrates compliance with Plan administrative procedures; or

11. Constitutes a policy statement or guidance concerning the denial, regardless of

whether it was relied upon.

In the case of a claim for short-term or long-term disability, you are also entitled to a review,

free of charge, and reasonable opportunity to respond to any new or additional evidence

considered, relied upon, or generated, or any new or additional rationale in support of an

adverse decision, before an adverse decision is rendered.

If you want to appeal a claim decision, you must file your request within:

12. 180 days of receiving a denial of a Group Health Benefit claim;

13. 180 days of receiving a denial of a disability claim;

14. 60 days of receiving a denial of a claim for other benefits; or

15. In the case of urgent care claims, a request for an expedited appeal may be

submitted orally, and all necessary information, including the Decision Maker on

Appeal’s benefit determination, may be transmitted between you and the Decision

Maker on Appeal via telephone, facsimile, or other available similarly expeditious

methods.

All other requests for an appeal must be in writing and include your Social Security

Number, a copy of the denial letter(s), and any other pertinent information that you wish the

Decision Maker on Appeal to consider. If a medical expert was consulted in connection with

45

your initial claim, then the Decision Maker will disclose the name of the expert, upon request,

regardless of whether the expert’s opinion was used to make the initial claim decision. The

Decision Maker on Appeal will consult a different medical expert than the expert consulted in

the initial decision. The expert consulted on appeal will not be a subordinate of the expert

consulted in the initial claim decision.

Upon timely receipt of written appeal, the Decision Maker on Appeal will evaluate

your claim and will make a determination within:

• 72 hours for an urgent care claim;

• 30 days for a pre-service claim;

• 60 days for a post-service claim;

• 45 days for a disability claim (the Plan may extend this time by an additional 45

days; however, the Decision Maker on Appeal will notify you prior to the end of

the initial 45-day time period, explain the reason for the extension, and give an

approximate decision date); or

• 60 days for a claim for other benefits including eligibility (the Plan may extend this

time by an additional 60 days; however the Decision Maker on Appeal will notify

you prior to the end of the initial 60-day time period, explain the reason for the

extension, and give an approximate decision date).

The Decision Maker on Appeal will not extend the time period for decision on a Group

Health Benefit claim appeal unless you voluntarily agree to such extension. The Decision

Maker on Appeal will notify you in writing if your claim is denied.

In the case of a notice of denial relating to your claim for short-term or long-term

disability, the notice will also include the following information:

• A statement of any applicable contractual limitations period that applies to your right to

bring such an action and the calendar date on which the contractual limitations period

expires;

• A discussion of the decision, including an explanation of the basis for disagreeing with or

not following: (i) the views presented to the Plan of health care professionals treating

you and vocational professionals who evaluated you; (ii) the views of medical or

vocational experts whose advice was obtained on behalf of the Plan in connection with

the denial, without regard to whether the advice was relied upon in making the denial;

and (iii) a disability determination regarding you presented by you to the Plan made by

the Social Security Administration; and

• Either the specific internal rules, guidelines, protocols, standard or other similar criteria

of the Plan relied upon in making the adverse decision or, alternatively, a statement that

such rules, guidelines, protocols, standards or other similar criteria of the Plan do not

exist.

46

10.13 Notice of Determination on Appeal

Subject to the notification requirements outlined above, you will receive a written or

electronic notice of claim determination. The notice will be written in a manner that is

intended to be understandable and will contain information explaining all the following

information applicable to your claim:

• The specific reason(s) for the denial;

• The specific reference to pertinent Plan, Welfare Program document and/or SPD

provisions upon which the denial was based;

• A statement that you are entitled to receive, free upon request, copies of and

reasonable access to documents, records, and other information relevant to your

claim;

• A statement describing any voluntary appeal procedure, if available, and your right

to obtain information regarding such procedure;

• A statement regarding any possible alternative dispute resolution options;

• A statement of your right to bring civil action under ERISA;

• If the denial is based on an internal rule, protocol, procedure, or guideline relied

upon in making the adverse decision, an explanation of such rule, protocol,

procedure, or guideline, or a statement that such is available, free of charge, upon

request;

• If the denial was based on a medical necessity or experimental, investigational, or

unproven treatment or similar exclusion or limit, either an explanation of such

judgment or a statement that such explanation is available upon request and is free

of charge.

10.14 The Decision on Appeal is Final

You must exhaust all of the available administrative claim procedures available under

the Plan before you can bring suit in federal court. All decisions made by the Plan

Administrator (or any other person delegated authority by the Plan Administrator to act in

accordance with this Plan) shall be final and conclusive on all Employees, their Dependents

and all other persons.

If you have any questions or would like more information about the claims procedures,

please contact the Plan Administrator.

47

HOLOGIC, INC.

WELFARE BENEFIT PLAN

Appendix B

Welfare Benefit Plans

The following Welfare Programs shall be treated as comprising the Hologic, Inc. Welfare

Benefit Plan pursuant to Section 1.2 herein:

Plan Eligible Waiting Period

1. The Hologic Medical Plan Date of hire

2. The Hologic Dental Plan Date of hire

3. The Hologic Life Insurance Plan Date of hire

4. The Hologic Long Term Disability Plan Date of hire

5. The Hologic Short Term Disability Plan 30 days after date of hire

6. The Hologic Accidental Death and Dismemberment Plan Date of hire

7. The Hologic Prescription Drug Plan Date of hire

8. The Hologic Employee Assistance Program Date of hire

9. The Hologic Health Flexible Spending Account Date of hire

10. The Hologic Health Savings Account Date of hire