The plan pays benefits for covered charges. Covered charges are the actual cost charged to a covered person for medically necessary care of an illness or injury, but only to the extent that the actual cost charged does not exceed reasonable and customary charges. In order to be a covered charge, a charge must be incurred for services and supplies which are:

prescribed by a physician;
provided to a covered person while covered under this plan;
specifically listed in this plan as covered; and
not excluded or limited by any provision of this plan.

The following are covered charges:

Hospital Inpatient

Room and Board: Charges by a hospital for semi-private room and board are covered charges. If a private room is medically necessary or if the hospital has private rooms only, covered charges will not exceed the average private room rate. Charges by a hospital for specialty care units, such as intensive care, cardiac care, and burn care units are covered charges.

Ancillary: Services and supplies, other than room and board, provided and billed for by a hospital are covered charges. Take-home items are not covered

Precertification requirement

Confinement in a hospital must be precertified by calling Principal Medical Management. Failure to Precertify may cause reduction in benefits.

Pre-Admission Testing

Medically necessary tests and studies performed in an outpatient setting before an inpatient hospital admission are covered charges. Covered charges do not include and the plan will pay no benefits for preadmission tests if:

•they are performed to establish a diagnosis;

•they are repeated after admission;

•they are performed more than 72 hours before admission; or

•the admission is canceled or postponed.

Hospital Outpatient

Charges by a hospital for outpatient treatment are covered charges. Benefits are subject to deductibles and coinsurance in accordance with the type of service provided.

Skilled Nursing Facility

Charges by a skilled nursing facility for room and board, ancillary services and supplies and diagnostic services are covered charges. Covered charges for room and board will not exceed the average semi-private room rate.

Benefits are subject to deductible and applicable coinsurance.

Physician Services

•Inpatient Medical Visits: Charges of a physician for inpatient hospital visits are covered charges. However, covered charges do not include physician visits in a hospital when connected with the preparation for or care after surgery or with maternity care. Benefits are limited to 1 visit per physician per day per diagnosis including consultations.

•Intensive Medical Care: Charges of a physician for intensive medical care are covered charges.

•Consultations: Charges of a physician for outpatient, home and office visits are covered charges.

•Surgery: Charges of a physician and ambulatory surgical facility for surgery are covered charges. Services of an assistant surgeon are covered charges; however, covered charges will not exceed 20% of the allowance for the primary surgeon.

If two or more surgical procedures are performed during the same operative session, covered charges for each secondary procedure will not exceed 50% of the amount the plan would allow for that procedure if performed alone, provided:

#the secondary procedure is to correct a separate pathological condition;

#the pathological condition would have required surgical intervention had an incision not already been present; and

#the difficulty, operative time, and risk are significantly increased by the secondary procedure.

If any one of these criteria is not met, the secondary procedure is considered an integral part of the primary procedure and is not reimbursed separately.

Organ Transplants

Charges for services and supplies provided to a covered person in connection with the following transplants are covered charges.

•bone marrow•pancreas

•heart•kidney

•heart/lung•kidney/pancreas

•lung•cornea

•liver

•Donor Charges: Covered charges include charges incurred by an organ donor if:

#both the donor and recipient are covered persons.

#the donor is a covered person, even if the recipient is not.

#the recipient is a covered person even if the donor is not, but only to the extent the donor’s expenses are not covered by another health plan.

#Benefits for donor charges will not exceed $15,000 per transplant.

•Exclusions: Covered charges do not include and the plan will pay no benefits for:

#mechanical or artificial hearts.

#animal to human organ transplants.

#experimental or investigational procedures.

#any human organ or tissue transplant not specifically listed as covered.

Anesthesia

Charges of a physician or Certified Registered Nurse Anesthetist for general and regional anesthesia are covered charges when it is medically necessary that someone other than the surgeon or assistant surgeon provide those services.

Maternity

Pregnancy is treated the same as an illness for purposes of this plan. Charges by a hospital for routine newborn nursery care provided to a covered person are covered charges. Maternity charges incurred by a surrogate mother are not covered charges. The child of a surrogate mother is not considered a natural child for purposes of this plan.

This plan will not restrict benefits for any hospital length of stay in connection with childbirth for a mother and her newborn child:

•to less than 48 hours following a normal vaginal delivery; or

•to less than 96 hours following a delivery by caesarean section.

However, this shall not apply in any case where the decision to discharge the mother or her newborn child prior to the minimum length of stay specified in this provision is made by the mother in consultation with her attending physician.

Diagnostic Services

Charges for the following procedures are covered charges when provided for diagnosis and testing because of specific symptoms:

•radiology, ultrasound and nuclear medicine;

•laboratory and pathology; and

•EKGs, EEGs, MRIs and other electronic diagnostic medical tests.

Charges for diagnostic services are subject to the deductible except for covered diagnostic services performed by an in-network provider during inpatient hospitalization or in connection with pre-admission testing, surgery-related testing or an emergency accident or emergency illness.

•Exclusions: Covered charges do not include and the plan will pay no benefits for:

#audiometric testing, when performed to determine the need for a hearing aid;

#refractive testing of the eye;

#examinations for fitting of eyeglasses, contact lenses, or hearing aids;

#dental examinations;

#pre-marital examinations;

#research studies;

#screening;

#physical examinations or check-ups; or

#psychological testing.

Emergency Room

An emergency accident is a sudden external event resulting in bodily injury. “Emergency accident” does not include physical conditions resulting from sickness or disease. Charges by a physician or hospital emergency room for medically necessary services due to an emergency accident, including immunizations, are covered charges.

See the diagnostic services benefits for payment of diagnostic services.

An emergency illness is a medical condition that is not accident related. It is characterized by the sudden onset of acute symptoms. The lack of immediate medical attention may result in:

•permanently jeopardizing the patient’s health;

•serious medical consequences;

•serious impairment of bodily function; or

•serious and permanent dysfunction of any bodily organ or part.

Charges by a physician or hospital emergency room for medically necessary services due to an emergency illness are covered charges.

See the diagnostic services benefits for payment of diagnostic services.

Ambulance

Charges for medically necessary transportation of a sick or injured person provided by a hospital or by a government-certified ambulance service are covered charges. The vehicle must be designed and equipped to transport the sick or injured. Both air and ground services are covered.

Therapy Services

Charges for services by a therapist for the treatments listed below are covered charges provided the therapist is licensed to provide the therapy by the state in which he practices or, if the state does not issue that type of license, is certified to provide the therapy by an appropriate professional body.

•radiation therapy.

•chemotherapy.

•dialysis including hemodialysis and peritoneal dialysis. Charges of a freestanding dialysis facility are covered charges.

•physical therapy.

•respiratory/inhalation therapy.

•occupational therapy.

•speech therapy.

•cardiac rehabilitation, provided that it begins within 3 months following cardiac surgery, post myocardial infarction or with unstable angina pectoris. Benefits will not exceed 24 visits per 12-week period.

•chiropractic services. X-rays taken or ordered by a chiropractor are considered diagnostic services and are not counted against the calendar year limit for therapy services.

Benefits for speech therapy for speech problems caused by injury or illness and occupational therapy are limited to $2,500 each per calendar year.

Charges for treatment of developmental speech problems are not covered.

Combined benefits for physical therapy and chiropractic services are limited to $2,500 per calendar year. Maximum does not apply to inpatient charges.

Medical Aids

Charges for medical aids as described in this section are covered charges. Benefits for all medical aids combined are limited to $2,500 per calendar year.

•Prosthetic Devices: Charges for the initial purchase, fitting, repair, and replacement of fitted devices which replace body parts or perform body functions are covered charges.

Benefits for cochlear implants are covered charges and are limited to one implant per lifetime. The cochlear implant and the post-operative calibration sessions for cochlear implants are not included in the $2500 medical aids benefit limit.

Hearing aids are covered with a maximum payable of $500 every two calendar years.

•Durable Medical Equipment (DME): Charges for the initial purchase, repair and replacement, or rental of equipment that is appropriate for home use and manufactured mainly to treat sick or injured persons are covered charges. Covered charges do not include and the plan will pay no benefits for:

#routine maintenance.

#repair of rental equipment.

#charges for deluxe items to the extent they exceed the cost of standard items.

Benefits for DME will not exceed the purchase price of the equipment or plan maximum.

•Orthotic Appliances: Charges for the initial purchase, fitting, repair, and replacement of braces, splints, and other appliances used to support or restrain

a weak or deformed part of the body are covered charges. Covered charges do not include and the plan will pay no benefits for:

#corrective shoes, unless they are an integral part of a leg brace.

#standard elastic stockings.

#garter belts.

#sport orthotics or custom-made orthotics worn inside shoes to reduce pain.

#other supplies not specially made and fitted.

Mental Health

Charges for treatment of a mental illness or substance abuse are covered charges if provided by a physician (MD) or a psychologist who is a certified health service provider in psychology (PhD), hospital, psychiatric hospital, outpatient psychiatric facility or community mental health center.

Benefits for treatment of mental illness or substance abuse will not exceed:

•52 visits per calendar year for outpatient treatment.

•30 visits per calendar year for inpatient treatment.

Prescription Drugs

Charges for insulin, insulin syringes, and drugs and medicines requiring a prescription under federal law are covered charges when purchased through Anthem. The employer will provide information on using the Anthem Drug Card in a separate brochure. Covered drugs include:

•non-injectable legend drugs, except as expressly provided.

•contraceptives, oral

•insulin.

•disposable insulin needles/syringes.

•disposable blood/urine glucose/acetone testing agents (e.g., Chemstrips, Clinitest tablets, Diastix Strips and Tes-Tape).

•glucose elevating agents.

•lancets.

•A.D.D./Narcolepsy Medications are covered for individuals through the age of 18 years.

•compounded medication of which at least one ingredient is a legend drug.

•any other drug which under the applicable state law may only be dispensed upon the written prescription of a physician or other lawful prescriber.

Covered drugs do not include and the plan will pay no benefits for:

•contraceptive devices, regardless of intended use.

•A.D.D./Narcolepsy Medications for individuals 19 years of age and older.

•anabolic steroids.

•anti-wrinkle agents (e.g., Renova).

•dermatologicals, hair growth stimulants.

•DESI drugs: drugs determined by the Food & Drug Administration as lacking substantial evidence of effectiveness.

•fluoride supplements.

•growth hormones.

•immunization agents, blood or blood plasma.

•infertility medications.

•isotretinoin (Accutane).

•levonorgestrel (Norplant).

•non-legend drugs other than those listed above.

•pigmenting/depigmenting agents.

•vitamins, singly or in combination unless medically necessary and legend prenatal vitamins are covered.

•therapeutic devices or appliances, including needles, syringes, support garments and other non-medicinal substances, regardless of intended use, except those listed above.

•drugs labeled "Caution-limited by federal law to investigational use," or experimental drugs, even though a charge is made to the individual.

•medication which is to be taken by or administered to an individual, in whole or in part, while he or she is a patient in a hospital, rest home, sanitarium, extended care facility, convalescent hospital, nursing home or similar institution which operates on its premises, or allows to be operated on its premises, a facility for dispensing pharmaceuticals.

Blood

Charges for blood and blood transfusions are covered charges.

Oxygen

Charges for oxygen and its administration are covered charges.

Home Health Care

Charges by a home health care agency for home health care are covered charges provided that the patient’s physician refers him to a home health care agency and the patient is confined to his home. In addition, charges by an R.N. or L.P.N. for home health care are covered charges.

Covered charges do not include custodial care or charges made by a person who is a member of the patient’s immediate family or who normally resides in his home.

Hospice Care

Charges by a hospice for hospice care are covered charges. A patient must be referred to the hospice program by a physician. The physician must document that the patient’s life expectancy is six months or less, and that hospice services provide appropriate methods of treating the patient. It is recognized that some patients may still require services after the six months have elapsed.

All hospice services must be provided in accordance with a treatment plan worked out in advance by the patient’s physician and the hospice.

Dental Care

Coverage under the medical plan is provided for dental services to repair damage to the jaw and sound natural teeth, if the damage is the direct result of an accident (but did not result from chewing) and if the dental services are completed within 12-monthsafter the accident. Covered charges are limited to the least expensive of the procedure that would provide professionally acceptable results.

Temporomandibular Joint (TMJ) Syndrome

Charges for treatment of TMJ syndrome are covered charges.

Benefits will not exceed $1,000 per calendar year or $3,000 per lifetime.

Wellness Care

Charges by a physician for the following services are covered charges even if the patient is not sick or injured:

•well baby care.

•immunizations

•physical examinations, including routine diagnostic testing.

•pap smears and annual gynecological testing, limited to one per calendar year.

•cholesterol and triglyceride testing.

•screening mammographies.

•EKGs.

•hemocult tests.

•blood tests.

•prostate specific antigen (PSA) tests.

•ovarian cancer screening (CA125) tests.

•hepatitis A and B vaccines.

•flu and pneumonia vaccines.

Benefits for routine care will not exceed $600 per calendar year.

Covered charges do not include and the plan will pay no benefits for physical exams and testing for school, sports, camp, insurance purposes or immigration or any other exams required by any government agencies.

PRECERTIFICATION

This section describes the plan’s requirements for Precertification of inpatient hospital admissions. For covered persons in the Sagamore Health Network PPO, precertification services are provided to the plan by the following Utilization Review (U/R) provider:

Sagamore Health Network

1-800-382-8414

Hospital Pre-Admission Requirements

When a covered person requires hospitalconfinement, he will need to follow the procedures below in order to avoid a reduction in benefits for hospitalconfinement charges. The procedures differ depending on the type of admission.

If Medicare is the primary payor, there is no need to precertify.

Principal will notify the covered person, the physician, and the hospital of the number of hospital days certified.

Hospital pre-certification procedure

For other than a medical emergency: Before entering the hospital the covered person, a family member or physician must call Principal and provide the information required

For Medical Emergency: The covered person, a family member or physician must call Principal and provide the information required within two working days after entering the hospital or as soon as reasonably possible

For Extended Hospitalization: Principal will t contact the hospital on the anticipation date of discharge. if a longer hospitalization is anticipated, the attending physician will be called to review a continued length of stay

Effect of Pre-certification

Pre-certification does not guarantee that the plan will pay benefits. If a covered person fails to call First Step as required by this section, the plan will reduce covered charges for expenses incurred at the hospital by $500.

The amount of this reduction will not be credited to any other deductible, co-payment or out-of-pocket maximum.

If a covered person remains in the hospital beyond the number of certified days, hospital charges for those days are not covered.

Appeals

If the plan has approved an ongoing course of treatment to be provided over a specified period of time or number of treatments, any decision by the plan to reduce or terminate that period or number of treatments may be appealed as provided in the Appeals section of this plan. The claims administrator will notify the claimant of the plan’s intent to reduce or terminate the benefit sufficiently in advance of the action to permit the claimant to appeal and obtain a determination before the benefit is reduced or terminated. A claimant may ask the plan to extend treatment beyond what was originally approved. If the claim involves Urgent Care, the claims administrator will act on the request within 24 hours after receiving it, provided that it is made at least 24 hours before the benefit is to end. In all other cases, it will act on the request as described in the Notice of Benefit Determination section of this plan for the filing of Urgent or Non-Urgent preservice claims, as applicable. See that section also for a definition of an Urgent claim. See the Claims Appeal section of this plan for information about how to appeal a concurrent care decision.

PREEXISTING CONDITIONS LIMITATION

ABOUT THIS SECTION

The plan substantially limits benefits for preexisting conditions. This section defines what a preexisting condition is and describes how the plan limits benefits.

A preexisting condition is a physical or mental condition for which medical advice, diagnosis, care or treatment was received by or prescribed or recommended for a person during the 6-month period ending on that person’s Enrollment Date. However, the plan will never consider pregnancy a preexisting condition.

Applicaion of the Preexisting Condition

Exclusion: For persons who enroll as described in the section of the plan covering Normal Enrollment or Special Enrollment, covered charges do not include and the plan will pay no benefits for charges incurred in connection with a person’s preexisting condition if they are incurred within the 12-month period beginning on the person’s Enrollment Date.
For persons who become covered at any other time, covered charges do not include and the plan will pay no benefits for charges incurred in connection with a person’s preexisting condition if they are incurred within the 12-month period beginning on the person’s Enrollment Date.
However, the Preexisting Condition Exclusion will not apply to the first $2,500 of comprehensive medical Covered Charges in the first 12 consecutive months that coverage is in force.

The plan will not apply any exclusion for a preexisting condition to:

• a child who, as of the last day of the 30 day period beginning with the date of birth, is covered under any Creditable Coverage; or

• a child who is adopted or placed for adoption prior to age 18 and who, on the last day of the thirty day period beginning on the date of adoption or placement, is covered under any Creditable Coverage;

provided the child has not had a Significant Break in Coverage.

The plan will shorten the length of the preexisting condition exclusion as it applies to a covered person by the length of that person’s Creditable Coverage as of his Enrollment Date. However, Creditable Coverage in force before a Significant Break in Coverage will not shorten the length of the preexisting condition exclusion.

Definitions: As used in this section, these terms have the following meanings:

"Enrollment Date" means:

• for persons who enroll when an employee first becomes eligible for coverage under this plan, the date the employee’s Waiting Period begins.

Creditable Coverage does not include any coverage that consists solely of:
• accident only coverage (including accidental death and dismemberment).

• disability income insurance.

• for all other persons, the first day of coverage under this plan.

"Waiting Period" means, in the case of a person who enrolls during a Normal Enrollment, the period of time between the date a person becomes eligible for coverage and the first day of coverage. However, if a person becomes covered under this plan at any other time, the period before he becomes covered is not a Waiting Period.

"Significant Break in Coverage" means a period of 63 consecutive days during all of which a person does not have any Creditable Coverage. However, the plan will not take into account any Waiting Period when it determines if a person has had a Significant Break in Coverage.

"Creditable Coverage" means a person’s coverage:

• under a group health plan.

• under health insurance.

• under Medicare.

• under Medicaid (except coverage consisting solely of benefits under the Medicaid program for distribution of pediatric vaccines).

• provided as a result of membership in the uniformed services or the Peace Corps.

• provided by a medical care program of the Indian Health Service or a tribal organization.

• under a state sponsored health benefits risk pool or public health plan.

• under a health plan sponsored by a state, county or other political subdivision.

• under the Federal Employees Health Benefits Program.

• liability insurance (such as general or automobile liability coverage) including coverage supplemental to liability insurance and automobile medical payment insurance.

• workers’ compensation or similar insurance.

• credit insurance.

• coverage for on-site medical clinics.

The term Creditable Coverage also excludes coverage consisting solely of:

• dental benefits, vision benefits or long term care benefits if they are provided under a separate policy or plan or are not an integral part of a medical benefit plan and are limited to those types of benefits that are not normally covered under a medical benefit plan.

• specified disease coverage (e.g. cancer-only policies) or hospital indemnity or other fixed dollar indemnity coverage (e.g. $100 per day) if the benefits are provided under a separate policy or plan; there is no coordination of benefits between the coverage and an exclusion of benefits under a group health plan maintained by the same sponsor; and benefits are paid without regard for benefits paid by any group health plan maintained by the same plan sponsor.

• the following supplemental benefits provided under a separate policy:

< Medicare supplemental insurance.

< Tricare (CHAMPUS) supplemental programs.

< similar supplemental coverage provided under a group health plan.

EXCLUSIONS

About this Section: This section lists supplies, services and expenses for which the plan will not pay. the items listed here are in addition to any exclusions listed in the section of this plan on covered charges

Covered charges do not include and the plan will pay no benefits for:

1. treatment of intentionally self-inflicted injuries, including suicide or attempted suicide, whether sane or insane.

2. marriage counseling.

3.services and supplies for treatment of infertility, including but not limited to, artificial insemination, gamete intra fallopian transfer (GIFT) and in vitro fertilization.

4.services and supplies not prescribed.

5.treatment of obesity or other weight-related treatment, including charges for treatment of morbid obesity when medically necessary to treat other conditions (such as hypertension , diabetes or heart disease).

6.services and supplies for sex change.

7.immunizations, except as expressly provided.

8.radial keratotomy, or other surgeries to correct near sightedness, far sightedness or astigmatism.

9.sterilization or sterilization reversal.

10.contraceptive devices.

11.services of a provider who is a member of the patient’s immediate family or who normally resides in the patient’s household.

12.eyeglasses, contact lenses, or examinations (eye refractions) to prescribe or fit such items.

13.hearing examinations, except as expressly provided for cochlear implants.

14.services, supplies, or hospital care, which in the judgment of the plan administrator are not medically necessary.

15.custodial care.

16.dental care, except as expressly provided.

17.any experimental or investigational treatment, procedure, facility, equipment, drug, device, or supply or complications thereof.

18.treatment or care that is primarily intended to improve the patient’s appearance or to treat or prevent a mental illness or other psychological condition through a change in appearance. However, this does not exclude care and treatment intended to restore bodily function or correct a deformity resulting from disease, accidental injury, birth defects, or previous therapeutic process. See the Women's Health & Cancer Rights Act of 1998 Notice section of this plan for additional information regarding reconstructive breast surgery.

19.supportive devices of the feet; care of flat feet, fallen arches, weak feet, chronic foot strain, and toenails; and routine treatment of corns, bunions, and calluses. However, this does not exclude care of corns, bunions, calluses, or toenails when medically necessary because of diabetes or circulatory problems.

20.treatment which is covered under an applicable worker’s compensation, occupational illness or similar law.

21.services and supplies for research studies or screening examinations, except as specifically stated in the Covered Charges section of this booklet.

22.services or supplies used to treat conditions related to: (1) autism; (2) hyperkinetic syndromes; (3) learning disabilities; (4) behavioral problems; (5) mental retardation; or (6) senile deterioration, beyond the period necessary for diagnosis.

23.treatment of any illness or injury sustained as a result of any act of war while covered under this plan.

24.services or supplies to the extent a participant is not legally obligated to pay for them or charges which are waived by the provider or which would not have been made in the absence of coverage.

25.expenses incurred before coverage begins or after it ends, except as expressly provided.

26.rest cures or sanitarium care.

27.services or supplies furnished by any person or institution acting beyond the scope of his/her/its license.

28.services or supplies to the extent that the services are a Medicare Part A or Part B liability.

29.services or supplies received from a dental or medical department maintained by or on behalf of a group, mutual benefit association, labor union, trust, or similar person or group.

30.services provided by any governmental agency to the extent that the patient is not charged for them, except when this exclusion conflicts with state or federal law.

31.travel, whether or not recommended by a physician.

32.services or supplies not specifically listed as covered.

33.telephone consultations, charges for failure to keep a scheduled visit, or charges for completing a claim form.

34.recreation or diversional therapy.

35.materials used in occupational therapy.

36.personal hygiene and convenience items, such as air conditioners, humidifiers, hot tubs, whirlpools, or physical exercise equipment, even if a physician prescribes such items.

37.hospitalization for environmental change or provider individual charges connected with prescribing an environmental change.

38.treatment of temporomandibular joint (TMJ) syndrome, except as expressly provided.

39.services and supplies related to the treatment of abuse of nicotine from tobacco or other sources.

40.stand-by charges of a physician.

41.elective abortions.

42.developmental speech problems.

43.acupuncture.

44.charges to the extent they exceed reasonable and customary charges.

45.nursing services other than medically necessary nursing services provided by a home health care agency.

46.any injury incurred by a covered person while engaged in any illegal activity.

47.expenses incurred before coverage begins or after it ends, except as expressly provided.

48.services and supplies for restoration of sexual function; however, this does not exclude treatment intended to restore function lost as a result of treatment for a physical illness or injury covered under this plan.

49.vitamins, minerals, herbal treatments or nutritional supplements, except as expressly provided.

50.telephone consultations, charges for failure to keep a scheduled visit, or charges for completing a claim form or for providing medical records.

51.routine health care, except as expressly provided.

52.personal comfort items.

53.educational, developmental or vocational services and supplies.

54.wigs and hair transplants.

55.services and supplies obtained outside the United States if the patient traveled to that location to obtain the services or supplies or if the services or supplies could not be obtained or legally provided in the United States.

56.treatment of illness or injury incurred while on active duty in the armed forces of any state or country.

57.services of a social worker, except as expressly provided.

58.services of a resident or intern acting in that capacity.

59.charges eligible for coverage under any other part of this plan or another plan sponsored by the employer.

60.services that a school system is required by law to provide.

61.postage, sales tax, late fees, interest or finance charges.

62.holistic or homeopathic treatment or medicine.

63.enrollment in a health, athletic or similar club.

64.chelation therapy, except as approved by the Food and Drug Administration.

65.tests to determine the sex of an unborn child, unless medically necessary.

66.court-ordered services or supplies, unless they would also be covered without a court order.

67.charges for physical exams and testing for school, sports, camp, insurance purposes or immigration or any other exams required by any government agencies.

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Medical Benefits