National Health Access Citizens Health Care Working Group

National Health Access Citizens Health Care Working Group May 12, 2005 Presented by: Kenneth L. Sperling CIGNA Health. Care

Background The HR Policy Association • Represents the senior HR leadership of Fortune 500 companies • Over 240 member companies; cross-section of American industry • Entry into health care at 2003 annual meeting; formed Health Care Policy Roundtable • Identified the uninsured as principal focus

Health Care Policy Roundtable J. Randall Mac. Donald IBM Corporation, Chairman, Health Care Policy Roundtable Timothy Hughes Cox Enterprises, Inc. , Chairman, Public Policy Directions Greg Lee Sears Roebuck & Co. , Chairman, Affordable Health Care Solutions Coalition John Butler Textron Inc. , Chairman, Regional Health Care Quality Reform Initiatives Sid Banwart Caterpillar, Inc. , Chairman, Direct Pharmaceutical Purchasing Coalition

Charter Coalition Members ACS Episcopal Church Medical Trust Intel Pitney Bowes ALCOA Federal-Mogul Corporation International Paper Prudential Financial Aerojet Fed. Ex Ground Johnson Controls, Inc. Sears Roebuck & Compan Allstate Insurance Company First Data Corporation Kelly Services, Inc. Sprint Amerada Hess Ford Motor Corporation Limited Brands Standard Parking Anheuser-Busch FPL Group Inc. Lockheed Martin Corporation Starbucks Corporation Avon Gap, Inc. Maersk Starwood Hotels & Resorts Caterpillar Inc. General Dynamics Manpower Incorporated SYSCO Circuit City Stores, Inc. General Electric Company Marathon Ashland Petroleum Target Cox Enterprises, Inc. General Mills Marathon Oil Corporation Textron Inc. DTE Energy Company General Motors Marriott Toys "R" Us, Inc. Eaton Corporation Hilton Hotels Mc. Donald's Corporation United Parcel Service Edward D. Jones & Company, LP Honeywell Motorola, Incorporated United Technologies EMC Corporation The Home Depot Parker Hannifin Corporation Verizon Communications Emerson Electric Company IBM Corporation Payless Shoe. Source, Inc. Verizon Wireless Initial population – 1. 3 million • Employees, independent contractors, pre-65 retirees • 3 million including dependents

Affordable Health Care Solutions Coalition Concept • Address the issue of the “working uninsured” by aggregating large groups of employees not receiving a health care benefit subsidy from a broad cross-section of American industry • Create more viable individual health care market • Promote dissemination of provider efficiency and effectiveness data Focus on uninsured populations in large corporations, specifically— • Full-time, part-time, temps without coverage • Contract workers, independent agents, consultants • Pre-Medicare retirees

Affordable Health Care Solutions Coalition Goals • Fully insured • No required direct employer subsidy • Guaranteed issue (i. e. , no medical questions or underwriting) • National solution • Range of options and price points significantly better than current individual health insurance market, including comprehensive major medical coverage • Provider cost and quality transparency

National Health Access Offering for Fall 2005 Level VI Major Medical—$1, 100 Deductible (HSA)1 Level V Major Medical—$2, 000 Deductible (HSA)1 Level IV Scheduled Inpatient & Outpatient Benefits Level III Scheduled Outpatient Benefit Level II Wellness Benefit Discounted Network Level I Guarantee Issue (with waiting periods) Guaranteed Issue (no waiting periods) 1 Depending on location, individual products may be offered that do include individual underwriting 7

States with Major Medical Offerings Current configuration leads to Major Medical options in 32 states representing 87% of the eligible population

Challenges • Adverse selection concerns on major medical coverage led to a fragmented state-by-state solution • Could not cover franchisees or small employers • Need to build front-end infrastructure for eligibility, enrollment, billing, and service • Lack of industry consensus on provider quality measurement and reporting