City Care Benefits Frequently Asked Questions

1. Has the group of employers already formed an employer trust and if so, when?

Yes – City Care Benefits Trust was formed August 1^st, 2003 and initially offered HMO Medical Plans by Sharp and HMO and PPO plans for Dental & vision by Health Net. Effective since 8-1-2004, several new plans have become available:

• HMO Medical Plans offered by Sharp
• PPO, HMO & Voluntary Dental & Vision Plans offered by Golden West Dental & Vision
• HMO & PPO Vision Plans offered by Safeguard
• Chiropractic & Chiropractic/Acupuncture Plans offered by American Specialty Health Plans
• Employee & Dependent Term Life Plans offered by The Hartford

2. What is the nature of the group of employers? Are they in the same industry?

The Trust represents more than 70,000 employers in the city of San Diego, who maintain a valid city of San Diego business license. Just about every industry and profession is represented in this member base. Predominantly, the membership is made up of small employers with 12 or fewer employees.

3. Where are the employers located geographically?

Within the service area provided by the health care plans.

4. Who can be covered?

Full-time Employees (working 30 or more hours per week) of each employer, employees of the trust, Owners. A For Medical, Dental & Vision, the plans are contributory. Participation levels require 70% (Medical) / 75% (Dental/Vision) of eligible employees participate and a minimum employer contribution of 50% for Employee coverage. The Life & AD&D products require 100% employer contribution for Employee and Dependent coverage.

5. What is the size of the group of employers? How many of the groups are under 10 lives and what are the growth projections?

Average group size is about 2.63 employees. Approximately 440 groups are under 10 lives. We projected 1,000 groups representing 3,000 employees by August 1, 2005 (Plan Year Renewal). As of June 30^th, we had approximately 720 groups, and a total membership of approximately 3,000 members.

6. Who will collect the premiums and administer the plan? The Trust or the Carriers?

Seaman & Co., has been appointed the plan Administrator. Seaman & Co. is a locally owned and operated TPA (Third Party Administrator) licensed with the state of California. They will collect the premiums from employers and make consolidated payments to each insurance provider, agent, etc.

7. How is the trust plan sold?

The Trust is structured so that all licensed agents with Errors & Omissions coverage can sell the products and receive a commission.

8. Will the policy be issued to the Trust?

Yes. The policy is issued to the Trust.

9. If coverage is in-force, will we need copies of the in-force plan?

Yes. A copy of the existing bill should be furnished at the time of enrollment.

10. Will each employer have its own plan design?

Each employer can pick and choose which plans they want to participate in.

11. The Trust should be the only one that can cancel the policy but can an employer cancel their participation in the Trust?

Yes. An employer can cancel their participation in the Trust at any time, effective the last day of the month in which the cancellation is received by the Administrator.

12. What are the expectations around billing, enrollment and marketing materials?

The Administrator handles billing, enrollment and premium and commission payments. The Administrator is responsible for marketing, brochures, enrollment materials, etc.

13. Will there be centralized control for administrative functions? Will the Trustee assume these responsibilities, in not who will?

Yes. There will be centralized control for administration, handled exclusively by Seaman & Co. The Trustees hold ultimate authority and responsibility but have delegated this function to the Administrator.

14. Will each employer be signing a participation agreement to join the Trust?

Yes. The employer will sign an agreement stating which plans they would like to participate in.

15. Besides insurance, what else was this Trust set up for?

Employee Benefits of all types. Insured, self-insured and non-insured type plans such as Flexible Benefit/Section 125 plans.