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Guide to 2011 Benefits Enrollment

for Active IBM Employees

Whats Inside
Welcome to Enrollment for Your IBM Benefits
When Youre Ready to Enroll........................................................................................................4 Have You Just Been Hired?..........................................................................................................5

Your IBM Health and Insurance Benefits


IBM Medical Options.....................................................................................................................6 IBM Dental Options......................................................................................................................11 IBM Vision Options.......................................................................................................................12 New Hire Healthy Living Rebate..................................................................................................13 Flexible Spending Accounts.........................................................................................................14 IBM Disability Benefits.................................................................................................................15 Other Benefits Available to IBMers..............................................................................................16

Administrative and Legal Information


Coverage for Dependents............................................................................................................18 About Medicare Coverage20 Transition of Care.........................................................................................................................20 No Coverage Credits....................................................................................................................20 Evidence of Insurability.................................................................................................................21 ID Cards........................................................................................................................................21 Qualified Status Changes.............................................................................................................21

Are You Joining IBM as the Result of an Acquisition or Strategic Outsourcing Arrangement?
If so, you are receiving this information in advance of your date of hire so that you can familiarize yourself with IBMs broad array of health and related benefit programs. Your IBM Transition Manager will communicate the dates of your enrollment period as well as the availability of NetBenefits. In the meantime, if you have questions or need more information, contact our dedicated transition support specialists at the IBM Employee Services Center at 800-426-2008. You may also contact your IBM Transition Manager for assistance. Please note: Depending on the terms and conditions of your acquisition or outsourcing agreement, certain benefit provisions may differ from those described in this guide.

Welcome to Enrollment for Your IBM Benefits


As one of the nations leading employers and most health care-conscious large companies, IBM offers an array of innovative health care options to employees. This is your opportunity to choose your medical, dental and vision coverage, sign up for a health-related rebate and tax-advantaged flexible spending accounts, and give thought to important disability protection. IBM subsidizes employee health coverage at 100% under our core plan, well above the industry average. Our two no-cost medical options for employees and our programs supporting wellness and prevention contribute to this, despite overall national cost increases for health care. A hallmark of our wellness strategy, IBMs Healthy Living Rebates, are available as a way to help employees manage their health and that of their families. At IBM, we know that investing in prevention and well-being makes sense for our employees and our business. Thats because healthy employees tend to experience better quality of life and higher personal productivity. And those who receive regular care and discover health problems early tend to get well faster and spend less on medical care. Since 2006, IBM has provided 100% coverage for routine preventive care. IBM provides 100% coverage for in-network primary care under the IBM PPO, IBM PPO Plus and IBM Exclusive Provider Organization (EPO) options. Under the IBM High Deductible PPO with Health Savings Account, in-network primary care is covered at 100% after the deductible. Primary care physicians include general practitioners, internists, family practitioners, pediatricians, geriatricians and primary osteopathic physicians. This 100% coverage lowers your out-of-pocket costs for care by eliminating the coinsurance you would otherwise pay any time you or your covered family member receive care from an in-network primary care doctor. (Keep in mind that the doctor may perform tests or request other services (e.g., lab) that will have a separate charge that may be subject to the deductible and applicable coinsurance.) IBM pays the full cost of coverage for employees (contributions are required for dependents) who opt for the IBM Preferred Provider Organization (PPO) or the IBM High Deductible PPO with Health Savings Account (HSA) plans. As in the past, for those who enroll in an IBM medical option (not including HMOs), the company covers nearly all costs for routine checkups and preventive services received in-network and deductible-free coverage out-of-network, making it easy to keep current with ongoing tests and screenings that can help head off problems in the future. Our prescription drug program is designed to save on your out-of-pocket costs when you choose generic drugs over brand name drugs. Spiraling increases in prescription drug costs nationwide indicate that a shift to generics is an effective way for all of us to help manage brand name prescription drug use. As you make your benefit choices, choose the options that best match your needs, sign up for an incentive that can reward you for taking an active role in your health (if applicable), and participate in the savings protection plan and tax-advantaged accounts IBM offers to help you maximize your benefit dollars.

For More Information


A brief description of your IBM health and insurance benefits appears in this guide. For detailed information, please refer to the Health & Insurance tab of NetBenefits or your Personal Fact Sheet if you receive enrollment materials by mail, which show your available options and costs your Health Benefit Comparison Charts for detailed coverage information about your IBM medical and dental options About Your Benefits: Health Care, the IBM Summary Plan Description available in the Reference Library on NetBenefits, for detailed information on dependent eligibility, covered services and exclusions for all of your IBM benefit plans

When Youre Ready to Enroll


You can enroll or make changes to your coverage quickly and easily online via NetBenefits: 1. Log on to www.netbenefits.com. 2. On the Health & Insurance tab, select Get Started to begin your enrollment. 3. When youre satisfied with your elections, select the Save Your Benefits link on the Benefit Elections page. Note: Your elections will not be saved unless you select the Save Your Benefits link. The elections listed will be recorded as your new coverage. A confirmation screen will display. Make note of the confirmation number and print the page for your records. The confirmation screen will also direct you to any follow-up activities to complete your enrollment. If you dont have Internet access, call the IBM Employee Services Center at 800-796-9876 to speak with a service representative on business days (excluding holidays recognized by the New York Stock Exchange) between 8:30 a.m. and 8:30 p.m. Eastern time.

Special Service Numbers

Deaf and Hard of Hearing Access: 800-426-6537, available on business days (excluding holidays recognized by the New York Stock Exchange) between 8:30 a.m. and 6 p.m., Eastern time. Overseas Access: Dial your countrys toll-free AT&T Direct access number, then enter 800-796-9876. In the U.S., call 800-331-1140 to obtain AT&T Direct access numbers. From anywhere in the world, access numbers are available online at www.att.com/traveler or from your local operator.

Confirmation of Your Benefits

If you make changes to your benefits, you will receive an e-mail confirming the date and time you successfully completed your enrollment, along with a confirmation number and a link to NetBenefits. If you do not have an e-mail address on record, you will receive a confirmation statement in the mail after you complete your enrollment. If you do not make changes, your Personal Fact Sheet will serve as the confirmation of your benefits. You will not receive a separate confirmation statement in the mail.

Social Security Numbers Required for Employees and Dependents


IBM requires Social Security numbers be provided for all employees and dependents covered under IBM medical plans for plan administration, and to ensure IBM meets its obligation to report Social Security numbers for all individuals covered under IBM medical plans to the Centers for Medicare & Medicaid Services (CMS), an agency of the federal government. IBM remains committed to protecting the privacy and confidentiality of information and has established measures designed to meet privacy-related requirements and expectations. For more information, view IBMs privacy policy, available in the Reference Library. You must provide a Social Security number for you and all your covered dependents at the time you enroll. If any of your covered dependents do not have a valid Social Security number on record at IBM, you must provide this information when you enroll. If you need to provide a Social Security number for a dependent who is already enrolled, select the Update link next to the dependents name on the Review Dependents page, then enter your dependents Social Security number. You may also call the IBM Employee Services Center to provide Social Security numbers for your enrolled dependents. IBM understands that Foreign Nationals may not have Social Security numbers issued to them; if one of your dependents is a Foreign National and does not have a Social Security number, you must call the IBM Employee Services Center to document his/her status.

Have You Just Been Hired?


Your IBM Benefits as a New Hire
As a newly hired regular employee, you are eligible to enroll in the following IBM health and insurance benefit plans: Medical Dental Vision New Hire Healthy Living Rebate Health Care Spending Account Dependent Care Spending Account Long-term Disability This guide provides details about available options and plan provisions for each of these benefits. Review your Personal Fact Sheet or your Benefits Election page on NetBenefits for coverage levels and costs. Additional IBM Benefits You are also eligible for IBM Short-term Disability (STD) Income benefits as of your first day of work. The STD plan provides benefits if you are unable to work due to illness, accident or injury. This coverage is fully paid by IBM. You do not need to elect this coverage; all eligible employees are automatically covered. If you choose to participate in the IBM 401(k) Plus Plan, during the annual enrollment period (typically held each fall) youll have the opportunity to purchase insurance that continues contributions should you become disabled and qualify for IBMs long-term disability benefits. (Note: Enrollment in this plan is only available during annual enrollment.) For information on this 401(k) Disability Protection program, see page 15. To support your health and income protection needs, IBM also offers access to additional life insurance, as well as long-term care insurance, for you and your family. If you wish to participate in these benefits, you must contact the benefit administrators of the plans directly; you will not be able to enroll in Group Universal Life or the IBM Long-term Care Plan on NetBenefits or through the IBM Employee Services Center. See page 16 of this guide for more information about these plans, including contact information for the benefits administrators. Please note: Long-term Supplemental employees are not eligible for the following programs: Group Life Insurance, Short-term and Long-term Disability Insurance, 401(k) Disability Protection, Healthy Living Rebates, Long-term Care Insurance, MoneySmart and IBM Special Care for Children.

Important: Information on Dependent Eligibility Confirmation Process


As a newly hired employee, you will need to provide proof of eligibility for each of your dependents to Budco, IBMs dependent eligibility administrator, if you choose to cover your spouse/domestic partner or children under any IBM medical, dental or vision options. You will receive a dependent verification package at your home address with detailed information about the requirements for proof of eligibility. If you do not submit adequate documentation confirming your dependents eligibility for coverage, that dependent will be removed from coverage. Please contact the IBM Dependent Eligibility Confirmation Help Line if you have questions about providing proof of your dependents eligibility at 800-204-4IBM (800-204-4426) 9 a.m. to 6 p.m., Eastern time, Monday through Friday.

Your IBM Health and Insurance Benefits


IBM Medical Options
All of your medical options (except HMOs, if available) are administered by a regional health plan administrator. Your Personal Fact Sheet shows the plan administrator in your area. You can choose from the following options: IBM PPO IBM PPO Plus IBM Exclusive Provider Organization IBM High Deductible PPO with Health Savings Account (HSA) HMOs, if available in your area No Coverage

Out-of-Area Options
If you live outside the network coverage area, youll be able to enroll in an Out-of-Area (OOA) option for the IBM PPO, IBM PPO Plus and the IBM High Deductible PPO with HSA. Your Personal Fact Sheet will indicate whether you are eligible for Out-of-Area options.

About the Live/Work Rule


In certain cases, different health plan networks may be available at your work and home locations, and you may be eligible to enroll in the plan available in your work location. This is known as the Live/Work Rule. If you choose to enroll in the plan that is available in your work location, you and any family members you cover must receive care from providers who are members of your work locations health plan network to receive in-network benefits. (Note: Your work location is considered to be your work address as shown in BluePages.) If you want to enroll in the plan available in your work location, you must call the IBM Employee Services Center; enrollment in a work location plan is not available via NetBenefits.

Health Savings Account (HSA) Contribution Limits for 2011


If you enroll in the IBM High Deductible PPO with Health Savings Account and receive the full IBM Health Savings Account contribution of $500, you may contribute up to $2,550 to a Health Savings Account in 2011 and $5,650 if more than one individual is enrolled, according to Internal Revenue Service (IRS) rules governing health savings accounts. If you do not receive all or a part of IBMs $500 contribution for 2011, you may contribute that portion of your own money (using tax-deductible after-tax dollars), up to a maximum of $3,050 ($6,150 if more than one individual is enrolled). If you are between the ages of 55 and 65, you can make an additional catch-up contribution of up to $1,000 in 2011. You may contribute up to the annual maximum amount, even if you are not enrolled in the IBM High Deductible PPO with Health Savings Account for the full calendar year. You may enroll in either a Health Savings Account or the Health Care Spending Account. More information about Health Savings Accounts is available on the following page. You may also refer to the Health Savings Account section of About Your Benefits: Health Care (the Summary Plan Description) or the 2011 Health Savings Account Participant Information for Active Employees document, both available in the Reference Library on NetBenefits.

If You Choose No Coverage


Choose the No Coverage option only if you do not want IBM medical coverage including prescription drug coverage. If you decline coverage, you can enroll again during the next enrollment period, typically held each fall, or if you experience a qualified status change during the year.

Thinking about enrolling in the Health Savings Account?


A Health Savings Account gives you the flexibility to pay for current eligible expenses or save for future health care needs. Unlike a Health Care Spending Account, funds you do not use remain invested and roll over from year to year, so your account can grow over time. Whats more, interest and investment earnings are not subject to federal taxes. You can use Health Savings Account funds to pay for your share of eligible medical expenses (e.g., deductibles, coinsurance and copayments) as well as laser eye surgery, hearing aids and batteries, and acupuncture and other qualified medical expenses, as determined by the IRS. Other eligible expenses include long-term care insurance premiums (up to certain limits) and COBRA and Medicare premiums. IBM will contribute up to $500, in semi-annual payments, to those who open or maintain a Health Savings Account for 2011. Youll be eligible to receive

$250 if you participate in the Health Savings Account between Jan. 1, 2011 and June 30, 2011, are enrolled, have opened a Health Savings Account with the designated trustee and are on IBMs active payroll on June 30, 2011 $250 if you participate between July 1, 2011 and Dec. 31, 2011, are enrolled, have opened a Health Savings Account with the designated trustee and are on IBMs active payroll on Dec. 31, 2011

What to do: 1. Select the IBM High Deductible PPO with Health Savings Account as your medical option. Keep in mind that federal guidelines do not permit you to contribute to a Health Savings Account if your spouse covers you or any eligible dependents under a different health plan or if you or your spouse participates in a Health Care Spending Account. 2. Open your Health Savings Account with the trustee who administers the Health Savings Account for your health plan. To receive the first of IBMs semi-annual contributions, youll need to open your Health Savings Account no later than June 30, 2011. (Note: IBM will not make a retroactive contribution for participants who open their Health Savings Account after this date.) Contact your plans trustee directly if you have questions. You may be offered investment options for your Health Savings Account funds. Direct all questions about interest and/or investment gains and losses to the bank or other sponsoring institution. Keep in mind that all investments have some degree of risk and participants are solely responsible for any investment elections they make. IBM assumes no responsibility or liability for participants investment elections. Your Health Savings Account is a separate account and is not an IBM-sponsored benefit plan. You are solely responsible for understanding and following any rules governing Health Savings Accounts and how contributions may be used. If you have questions about Health Savings Accounts, contact a tax or financial consultant or review the 2011 Health Savings Account Participant Information for Active Employees document or About Your Benefits: Health Care, available in the Reference Library on NetBenefits and the Legal Notices page of w3.

Whats Covered?
All of your non-HMO IBM medical options provide coverage for eligible medical services, including 100% in-network coverage for routine preventive care and primary care prescription drugs mental health/substance abuse care condition management services, provided by Alere, OptumHealth or your health plan For coverage information, select the Details link next to each medical option on your online Benefit Elections page, then select the Cost and Coverage tab. You may also refer to the Health Benefit Comparison Charts.

100% In-Network Coverage for Routine Preventive Care


You dont need to meet an annual deductible or pay coinsurance for eligible routine preventive services, such as those recommended by the U.S. Preventive Services Task Force, if you receive them from an innetwork provider. Examples of eligible services include annual physical exam annual well-woman exam well child care immunizations/vaccines routine mammography pap smear prostate cancer screening skin cancer screening colorectal cancer screening cholesterol screening hypertension screening certain other preventive services and screenings that are a part of a checkup or physical exam. Beginning Jan. 1, 2011, the IBM medical plans (except for HealthAmerica PA (HMO), Pacificare Northern CA (HMO) and the Global Assignee Medical Plan, which are grandfathered health plans) will also cover preventive care services and items that are required under the Patient Protection and Affordable Care Act. Examples of eligible services include: colorectal cancer screening, breast cancer screening, cholesterol screening, hypertension screening, and immunizations/vaccines. You will not be required to pay coinsurance or copayments for covered preventive services. However: If you receive preventive services during an office visit, you will be required to pay any applicable coinsurance or copayment if the doctor or health care provider does not bill or code separately for the service and the primary reason for your visit is not to receive the preventive service. Contact your provider directly if you have questions. If you receive these services from an out-of-network provider, you will be responsible for any applicable deductible, coinsurance or copayment. Keep in mind that if your medical option only provides coverage for services from in-network providers, preventive care items or services that you receive from an out-of-network provider will not be covered. Different preventive benefits apply for HMOs.

A complete list of routine preventive exams and tests eligible for 100% coverage can be found on w3 and in About Your Benefits: Health Care, the Summary Plan Description, available in the Reference Library on NetBenefits.

100% Coverage for Primary Care


Care provided by your in-network primary care physician is covered at 100% under the IBM PPO, IBM PPO Plus and IBM Exclusive Provider Organization (EPO) options. Under the IBM High Deductible PPO with Health Savings Account, in-network primary care is covered at 100% after the deductible is satisfied. Primary care physicians include general practitioners, internists, family practitioners, pediatricians and primary osteopaths. This lowers your out-of-pocket costs for care by eliminating the coinsurance you would otherwise pay any time you or your covered family member receive care from an in-network primary care doctor. Keep in mind that the doctor may perform tests or request other services (e.g., lab) that will have a separate charge that may be subject to the deductible and applicable coinsurance.

If You Will Be Enrolling in an HMO* and Selecting a Primary Care Provider


You have the right to designate any primary care provider who participates in a health plans network and who is available to accept you or your family members. You may designate a pediatrician as the primary care provider for your child(ren). If you do not designate a primary care provider or your designation is no longer valid, the HMO may designate a primary care provider for you. If so, your primary care provider will be the person assigned to you by the HMO until you make a designation. You do not need prior authorization from the HMO or from any other person (including a primary care provider) in order to obtain access to obstetrical or gynecological care from a health care professional in the network who specializes in obstetrics or gynecology. The health care professional, however, may be required to comply with certain procedures, including obtaining prior authorization for certain services, following a pre-approved treatment plan, or procedures for making referrals. For a list of participating health care professionals who specialize in obstetrics or gynecology, contact the HMO administrator directly.
*Please note: These provisions do not apply to HealthAmerica PA (HMO) and Pacificare Northern CA (HMO)because they are grandfathered health plans.

Coverage for Nutritional Counseling


IBM medical plans provide the following coverage for nutritional counseling provided by registered dieticians and licensed nutritionists: Up to two visits per year for those who do not have a chronic medical condition, or Up to four visits per year for those who have a chronic medical condition

Mental Health/Substance Abuse Coverage


The administrator for your mental health/substance abuse benefits depends on your medical option as shown in the table below. Please refer to the Health Benefit Comparison Charts or your Health Plan Detail Sheets for coverage information. Medical Option IBM PPO (including Out-of-Area options) IBM PPO Plus (including Out-of-Area options) IBM Exclusive Provider Organization IBM High Deductible PPO with HSA IBM EPO HealthPartners HMOs Mental Health/Substance Abuse Administrator OptumHealth Behavioral Solutions by United Behavioral Health, under the IBM Managed Mental Health Care Program

Your health plan or HMO

Prescription Drug Coverage


The administrator for your prescription drug benefits depends on your medical option, as shown in the table below. Please refer to the Health Benefit Comparison Charts or your Health Plan Detail Sheets for coverage information. Medical Option IBM PPO (including Out-of-Area options) IBM PPO Plus (including Out-of-Area options) IBM Exclusive Provider Organization IBM EPO HealthPartners IBM High Deductible PPO with HSA HMOs Prescription Drug Administrator Medco, under the IBM Managed Pharmacy Program

HMO

IBM Managed Pharmacy Program


The IBM Managed Pharmacy Program is available to those whose prescription drug coverage is administered by Medco. Coverage for Short-Term Medication: You can use retail pharmacies for medication such as an antibiotic for a sudden illness for up to a 30-day supply. Youll save money if you use a pharmacy that participates in Medcos network. Coverage for Long-Term Medication: If you are taking medication for a chronic condition such as high blood pressure, you will receive benefits for a 30-day supply at a retail pharmacy (plus up to two refills) for the initial prescription only. Subsequent refills must be ordered through the Medco Pharmacy (mail order service) or youll pay the entire cost for the refill at the retail pharmacy. If Your Medication Requires Special Handling: If you need covered prescription medication that requires special handling or administration such as chemotherapy and are currently receiving it through your doctors office or other treatment center, you can order it through Accredo, the Medco special care pharmacy. By ordering covered prescription medication this way, you may pay less for it overall. Additionally, you may be able to have it shipped directly to you or your doctors office at no additional charge. Contact Medco Member Services for more details.

GenericsAdvantage
If a generic equivalent (identical active ingredient) is available and you choose a brand name drug instead for a new prescription, you will pay the full* generic coinsurance plus the difference in cost between the generic and brand name drug. (*Note: The per prescription maximum will not apply as it usually would for Medco participating pharmacies and mail order prescriptions.) However, if your physician validates it is clinically indicated for you to use the brand name drug, you will only pay the usual brand name coinsurance (and not the difference in cost). Under GenericsAdvantage, in those few cases where a particular brand name drug is comparably priced with a generic in the same class of drugs, prior authorization will not be required for that brand drug. Prior authorization will be required for other brand name drugs in that class; otherwise, they will not be covered.

Specialty Medications
If you require a new prescription for a specialty medication, your doctor will first need to contact a Medco pharmacist for authorization to confirm that the treatment complies with standard clinical guidelines. This requirement will help ensure that you receive the proper drug, dose and treatment based on your diagnosis.

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IBM Dental Options


You may choose from the following dental options: IBM Dental Basic IBM Dental Plus CIGNA DMA All dental options provide coverage for preventive, diagnostic and basic restorative care; some options also provide coverage for major restorative care and/or orthodontia. A pretreatment estimate may be required for certain services. Refer to the dental section of the Health Benefit Comparison Charts for coverage details. If you have questions about reimbursement for eligible services or to locate a network provider, contact MetLife directly at 800-872-6963 or log on to www.metlife.com/MyBenefits. For coverage details and contact information for the CIGNA DMA, please refer to the plans Health Plan Detail Sheet. More details on the IBM Dental Plans can be found in the Summary Plan Description available in the Reference Library on NetBenefits and on w3; you may also request a copy by calling the IBM Employee Services Center.

Get a Pretreatment Estimate


If you are enrolled in a dental option other than the CIGNA DMA and your dentist recommends a dental procedure that exceeds $200, you should request a pretreatment estimate from MetLife before the procedure is performed. MetLife will review your dentists treatment plan to determine the eligibility of the treatment and whether its the most appropriate and cost-effective treatment for your condition. MetLife will then inform you and your dentist of the amount that will be reimbursed for the procedure. During the review, MetLife may determine a more cost-effective treatment is sufficient and appropriate. If so, your benefits will be based on that alternative treatment. You and your dentist may still choose the more costly procedure, but you will be responsible for the difference in charges. This applies even when you dont get a pretreatment estimate.

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IBM Vision Options


You may choose one of the following vision options:

IBM Vision Plan This option provides benefits for an annual eye exam; one pair of glasses or contact lenses and eyewear both within and outside the VSP network, along with the same discounts offered by the VSP Vision Card. VSP Vision Card This free vision discount card lets you save money on eye exams, eyewear and other vision care services from VSP network providers.

If you have questions about available discounts or benefits under the IBM Vision Plan or VSP Vision Card, or to locate a provider in the VSP network, contact VSP directly at 888-877-4426 or log on to www.vsp.com/ibm. IBM Vision Plan In-Network Out-of-Network Plan pays full eligible Up to $35 charge Plan pays full eligible Single vision: up to $25 charge; certain lens Bifocal: up to $40 options not included Trifocal: up to $55 Lenticular: up to $80 Plan pays up to $120 for Up to $35 certain frames; you may pay a portion for others Elective: up to $120 Elective: up to $105 Medically Necessary: no Medically Necessary: up charge with prior to $165 approval VSP Vision Card 20% discount on VSP providers fee 20% discount off the retail price on complete pairs of prescription glasses, including a variety of lens options 15% discount on VSP providers fee for contact lens exams (fitting and evaluation services). Discounts are not available for contact lenses. On average, 15% discount available

Annual Eye Exam Lenses

Frames

Contact Lenses

Laser Vision Correction Surgery

Eligible Providers

Filing Claims

No benefit coverage but savings may be available for LASIK or PRK surgery; contact VSP for details Contact VSP or visit www.vsp.com/ibm for a list of providers in your area Providers file claims on your behalf

Not applicable

See any provider

You pay for services when received, then submit the bill to VSP for reimbursement

Contact VSP or visit www.vsp.com/ibm for a list of providers in your area No claims to file; discounts are provided at time of purchase or service

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New Hire Healthy Living Rebate


Investing in prevention and well-being makes sense for our employees and our business because healthy employees tend to experience better quality of life and higher personal productivity. Those who discover health problems early tend to get well faster and spend less time and money on medical care. IBM offers a New Hire Healthy Living Rebate to encourage and support newly hired employees who want to take steps to identify their preventive care needs and personal health risks.

Program Requirements
To receive the $150 New Hire Healthy Living Rebate, employees must sign up during their initial benefits enrollment by indicating Will Participate for the New Hire Healthy Living Rebate program. You then complete the online program by December 31, 2011. The online program is available on the Health Management Center, provided by WebMD for IBM, accessible through NetBenefits. You will be guided through: Completion of the online Health Risk Assessment. Creation of the online Personal Health Record. Accessing IBMs Wellness for Life Web site to learn which wellness tools may be valuable for you. If you elect to participate in this rebate program, youll receive an email after your benefits enrollment period ends with detailed information about program requirements and how to get started. If you are hired late in the year, you may log on to the Wellness for Life Web site (www.wellnessforlifecenter.com) before you receive this informational email so that you can complete all program steps by the December 31, 2011 deadline. After successfully completing the program requirements, please allow six weeks for the rebate payment to appear in your paycheck. The rebate will be treated as taxable income.

The Health Risk Assessment: An Important First Step


Prevention is about understanding your health risks how your age, gender and medical history contribute to your overall health profile or put you at risk for conditions like heart disease, depression and diabetes. Specific medical indicators (like blood pressure and weight) and lifestyle behaviors (like diet, seat belt use and physical activity level) sharpen the health risk picture. And once you know more, you can put your knowledge and other preventive tools to work.

Your Personal Health Record: Helping You Make Wise Health Decisions
One of the keys to making wise health care decisions is having easy access to information. The online Personal Health Record can help by providing a single location to consolidate and organize medical information from multiple sources. You can include information about immunizations, allergies, medications, surgeries, lab results, provider information and much more. During the annual enrollment period, usually held each fall, you may be offered other Healthy Living Rebate programs for the following plan year. These programs are designed to encourage and support those who want to adopt or maintain healthy lifestyles and are available to regular active employees. Your spouse/domestic partner and other dependents are not eligible to participate.

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Flexible Spending Accounts


Flexible Spending Accounts let you use tax-free dollars to pay for unreimbursed eligible health care and dependent care expenses. Your contributions to a Health Care and/or a Dependent Care Spending Account are deducted from your pay on a before-tax basis each pay period. This lowers your taxable income so you pay less in taxes. Throughout the year, you may submit claims to your account(s) and receive reimbursement without paying taxes on the reimbursement amount. Participation in the Health Care and Dependent Care Spending Account is optional; however, if you want to participate, you must enroll and choose an annual contribution amount.

Health Care Spending Account: up to $5,100 (minimum election of $10 per month) Dependent Care Spending Account: up to $5,000 (minimum election of $20 per month) Note: If your spouse participates in a Dependent Care Spending Account, you may contribute a combined total of $5,000 each year.

Health Debit Card


If you participate in the Health Care Spending Account, you will receive a Health Debit Card. The Health Debit Card program is administered by Acclaris, the administrator for IBMs Flexible Spending Accounts. The Health Debit Card enables you to pay your portion of the cost of eligible prescription drugs through automatic deduction from your Health Care Spending Account. When you use the Health Debit Card at a participating Medco retail pharmacy or through Medcos mail order service, your Health Care Spending Account is debited for your coinsurance amount when you purchase prescription drugs. Using the Health Debit Card eliminates the need for you to file claims to receive reimbursement for these eligible expenses. You will receive your Health Debit Card from Acclaris, along with activation instructions, two to three weeks after you complete your enrollment. For more information about the Health Care Spending Account and Dependent Care Spending Account, refer to the following Summary Plan Descriptions available in the Reference Library on NetBenefits: About Your Benefits: Health Care About Your Benefits: Work and Personal Life Balancing

You Can Choose a Health Care Spending Account OR a Health Savings Account But Not Both If you want to enroll in the Health Care Spending Account, youll need to choose a medical option other than the IBM High Deductible PPO with Health Savings Account. Based on IRS regulations, you may not enroll in both a Health Care Spending Account and a Health Savings Account at the same time.

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IBM Disability Benefits


IBM Short-term Disability Income Plan
This coverage begins as of your first day of work and is fully paid by IBM. Benefits under the IBM Shortterm Disability Income Plan are payable if you are unable to work due to illness, accident or injury. The plan provides continuation of regular monthly compensation for each day absent, up to a maximum of 26 weeks in a period of 12 consecutive months, as shown below: Hire Date Before Jan. 1, 2004 On or after Jan. 1, 2004 Percent of Regular Monthly Compensation First 13 Weeks Second 13 Weeks 100% 100% 100% 66 2/3%*

* Note: After five years of service, coverage increases to 100%.

IBM Long-term Disability Plan


The IBM Long-term Disability (LTD) Plan provides benefits to covered employees who remain disabled after IBM Short-term Disability Income benefits end. The LTD options you are eligible to choose during the enrollment period depend on your date of hire and years of service. Evidence of insurability will not be required if you enroll when you are first eligible; however, evidence of insurability will be required if you increase your level of coverage during a future enrollment opportunity, such as annual enrollment. Your LTD premium cost is based on years of service, age and salary. Hire Date Before Jan. 1, 2004 On or after Jan. 1, 2004 Automatic Coverage, Fully Paid by IBM 50% LTD 50% LTD, after five years of service Coverage You Can Purchase During Enrollment 66 2/3% LTD 50% LTD or 66 2/3% LTD

401(k) Disability Protection Program


During annual enrollment, you may also purchase 401(k) Disability Protection insurance that continues your monthly contributions to the 401(k) Plus Plan if you become totally disabled and qualify for IBMs Long-term Disability Benefits. If you become disabled while you are insured, the dollar amount you choose to insure will be contributed to your 401(k) Plus Plan account in monthly installments for as long as your disability continues, up to age 65. You can choose to insure any combination of your pre-tax contributions (post-tax contributions are not eligible for this protection) IBMs matching contributions IBMs automatic contributions the Special Savings Award, if you are eligible to receive it Premiums are based on your age and the dollar amount you insure and are deducted from your 401(k) Plus Plan account each month. You will receive additional information about 401(k) Disability Protection before the next annual enrollment period.

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Other Benefits Available to IBMers


Employee Assistance Program
All benefits-eligible participants and their eligible family members have access to the Employee Assistance Program, which offers up to eight counseling sessions per situation per year at no cost to you. This benefit is available even if you are enrolled in an HMO or elect No Coverage through IBM. To access the Employee Assistance Program, call OptumHealth Behavioral Solutions Clinical Referral Line at 800-445-9720 (TRS: 800-525-5668). This toll-free number, available 24 hours a day, 7 days a week, is staffed by licensed mental health professionals with clinical experience in treating a range of mental health and substance abuse care needs.

IBM Group Life Insurance


IBM provides this coverage as of your date of hire; benefits are paid in the event of your death. IBM Group Life Insurance (GLI) coverage is fully paid by IBM and coverage above $50,000 is subject to imputed income. To avoid imputed income, you may submit a GLI waiver form within 30 days of your date of hire, or within 30 days of certain qualified changes.

IBM Travel Accident Insurance


This coverage provides benefits in the event of your injury or death as a result of an accident while traveling on official company business. IBM Travel Accident Insurance is also fully paid by IBM and effective as of your date of hire.

Group Universal Life Insurance


In addition to the Group Life and Travel Accident coverage that IBM provides, you can purchase additional life insurance through The Prudential Insurance Company of America. Group Universal Life Insurance is not an IBM benefit; contact Prudential directly at 877-448-5778 if you wish to enroll.

Long-term Care Plan


This coverage can help protect you and your family from the costs of long-term custodial care those for nursing home or home health care in the event of serious illness or injury. The Longterm Care Plan is not an IBM benefit; contact John Hancock Life Insurance Company directly at 800-255-8991 or log on to http://ibm.jhancock.com if you wish to purchase coverage for yourself or eligible family members. To access John Hancocks Web site, use the following information: User ID: IBM; Password: jhancock.

IBM Special Care for Children Assistance Plan (SCCAP)


This plan provides reimbursement for certain expenses that are outside the scope of the coverage available under the IBM medical and dental plans for eligible children with, physical or developmental disabilities. Assistance under IBM SCCAP is available only after all other aid available from federal, state and other sources has been exhausted. Each case is individually reviewed to determine eligibility for IBM SCCAP assistance. IBM SCCAP benefits, up to a lifetime maximum of $50,000 per child, are available until the child reaches age 26 or is no longer eligible under the IBM medical and dental plans, whichever occurs first. For more information about IBM SCCAP, contact the IBM Employee Services Center at 800-796-9876.

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MoneySmart
A MoneySmart Coach can help you assess the impact of your IBM benefit decisions on your financial plan. Contact a MoneySmart coach for help understanding things such as the impact of purchasing disability coverage versus not having this coverage in the event you become disabled, determining if a high deductible health plan with a health savings account (HSA) is the right choice for you, how much should you put in your Health Care or Dependent Care Spending Account and many other financial planning needs. For assistance with financial planning, call: 877-543-7678 (TTY: 866-217-8694) or send an email to moneysmart@ayco.com.

IBM Care Advantage Program


This program gives you and any of your covered family members who are not eligible for Medicare easy access to knowledgeable resources and support when you need medical care. The program offers you assistance in three ways: hospital precertification, care management and condition management. If you require treatment for a significant medical condition, serious illness or injury, a Care Coordinator (a registered nurse from your health plan assigned to you and your family) can help you: Learn about your illness, medical condition, or injury and treatment options. Prepare for a healthy pregnancy. Prepare for doctor visits to facilitate more productive discussions about your care. Plan for your care after a hospital stay. Precertify certain medical services, including hospitalization, and assess your need for home health care or other assistance, if necessary. Depending on your medical needs, a health care professional from your health plan may contact you directly. You may also call your health plan with a specific question about your treatment, or to request ongoing support. IBMs health plans each offer nurse helplines for additional support; call your plan for details.

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Administrative and Legal Information


Coverage for Dependents
As an IBMer eligible for health benefits, you may choose coverage for your eligible family members, including your spouse (opposite gender or same gender) or domestic partner and dependent children. Please review the information in this section carefully before deciding which of your dependents to enroll. For additional information about dependent eligibility, please refer to About Your Benefits: Health Care, available in the Reference Library on NetBenefits. The following individuals are considered eligible dependents under the IBM medical, dental and vision plans: Your spouse An eligible domestic partner Your eligible children up to age 26, regardless of their financial dependency on you or another person or their student, employment or marital status, including your natural and legally adopted children to age 26 your stepchildren to age 26 other children for whom IBM determines that you have been granted permanent legal guardianship by a court of law. You will be considered to have permanent legal guardianship only if both of the following requirements are met: The child is subject to a court order under which you, the employee, have been granted permanent legal guardianship of the childs person and property. A parent/child relationship exists between you, the employee, and the child. If you have a child with a disability, your child may be eligible for coverage beyond age 26 if IBM determines, on the basis of the childs condition, that your child is mentally or physically disabled, that the disability existed prior to the childs 26th birthday, that the child is incapable of self-support due to the mental or physical disability, and that the child is not married.

Federal Tax Implications for Children


Federal tax laws may have financial implications for IBMers who enroll dependent children. Dependent children must meet certain tax requirements to receive IBM health coverage on a taxfree basis. Dependent children who do not meet these requirements may still be enrolled in IBM health coverage; however, the value of their coverage will be considered imputed income to you and will be taxed accordingly. Dependent children who meet IBMs requirements for coverage but do not meet the federal tax law requirements for tax-free health coverage include children of a same-gender spouse or an eligible domestic partner whom you have not legally adopted, and who are not qualifying relatives as defined below. If your child or the child of your same-gender spouse or domestic partner meets IBMs eligibility criteria for coverage and is not eligible for tax-free coverage, the child will be subject to imputed income on the value of their coverage. If your same-gender spouse or domestic partner or his/her children meet the IRS qualifying relative criteria which allow you to claim him/her as a dependent on your federal income tax return, IBM will not impute taxable income on their benefits. However, if you have not adopted the children, they will be treated as dependents of your same-gender spouse or domestic partner and not of you, and you must notify IBM to impute taxable income on the value of their coverage, unless all of the following criteria are met: 1. More than half of the childs support for the year comes from you. 2. The child resides in and is a member of your household for the entire tax year.

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3. The individual for whom the child is a qualifying child (generally your domestic partner) has no individual tax return filing requirement or files only to claim a refund of withheld taxes. If you have questions about these tax rules, you should contact your personal tax advisor.

Medicaid/Child Health Insurance Plan (CHIP)


Eligible employees and their eligible dependents are allowed to enroll in the IBM health benefits program during the year if: Their coverage is lost under their respective state Medicaid or CHIP program; or They become eligible for premium assistance under their respective state Medicaid or CHIP program. If you are not already enrolled in the IBM health benefits program when one of the events above occurs, you will be able to enroll yourself and your eligible dependent(s) within 60 days of the date of the event. Coverage will be retroactive to the date of the loss of Medicaid or CHIP coverage or the date you became eligible for premium assistance under Medicaid or CHIP, as applicable. Enrollment requests received later than 60 days after one of the events above will not be accepted. However, you will have an opportunity to enroll during the next annual enrollment period.

For Those Covering Same Gender Spouses and Domestic Partners


Special tax rules also apply for same gender spouses and domestic partner coverage; therefore, you should consider the financial impact if youre enrolling a domestic partner in IBM medical, dental or vision coverage. For more information, refer to the Domestic Partner Information Guide available in the Reference Library on NetBenefits or the Career and life section of w3, or call the IBM Employee Services Center.

Eligibility Verification
Eligibility for health care benefits is determined in accordance with the eligibility requirements described above and in the Summary Plan Descriptions: About Your Benefits: Health Care (for active employees) and About Your Benefits: Post-Employment (for retirees). IBM may require documentation to support the eligibility of any dependent enrolled in an IBM benefit plan. If the plan administrator learns that you have enrolled an individual who is not an eligible dependent, that individual will be removed from coverage and you may be required to repay any benefits paid on behalf of such individual. In addition, you may be subject to disciplinary action, up to and including dismissal, and/or loss of eligibility under the plans. If you enroll an eligible dependent for tax-free coverage who is not eligible for tax-free coverage, appropriate corrective actions will be taken. Note: In certain states, some fully-insured plans (e.g., HMOs) may offer coverage directly to dependents who are not eligible for coverage under an IBM plan. Contact the plan directly if you have questions.

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About Medicare Coverage


Medical Services As an active employee, the IBM medical plan option provides primary coverage for you and any of your covered dependents, (even if anyone is eligible for Medicare) and Medicare may provide secondary medical coverage for those who are eligible for Medicare. Keep the following in mind when your employment with IBM ends: Medicare will provide primary coverage for anyone who is Medicare-eligible and the IBM medical plan will provide secondary coverage. You and/or any Medicare-eligible dependent(s) must enroll in Medicare Part B immediately when your active employment ends. Failure to do so will result in penalties added to your future Medicare Part B premiums. (You do not need to enroll in Medicare Part A; coverage is automatic.) If you or your eligible dependent(s) become eligible for COBRA coverage at any time during the year and are also eligible for Medicare due to age 65 or disability, you or your dependent must enroll in Medicare Parts A & B, so that it is effective the first day of COBRA coverage. Medicare will then provide primary coverage and COBRA coverage will be secondary. For more information, refer to About Your Benefits: Health Care, the Summary Plan Description, available in the Reference Library. Prescription Drugs Coverage for prescription drugs under most IBM medical options meets Medicares creditable coverage standard, which means IBMs coverage, on average for all plan participants, is expected to pay out as much as the standard Medicare Part D prescription drug coverage. Medicare-eligible individuals may be enrolled in IBM medical coverage that provides coverage for prescription drugs or a Medicare Part D prescription plan, but not both. You can view IBMs Notice of Creditable and Non-Creditable Coverage in the Reference Library.

Transition of Care
If your health plan administrator is changing or you are selecting a new medical option and you or one of your covered dependents is currently undergoing treatment for certain serious medical conditions or prenatal/maternity care, you may be eligible to continue receiving in-network benefits for a limited period of time, even if your doctor does not belong to your new plan network. Contact the administrator of your new plan for more information.

Credit for No Coverage Option if You Decline Medical and/or Dental Coverage
Since medical and dental coverage is optional, you can decline coverage from IBM for these benefits. If you elect No Coverage as your option for one or both of these benefits, you will receive the following credit(s) each month in your paycheck, which will be treated as taxable income: Medical No Coverage Credit: $30 per month Dental No Coverage Credit: $5 per month If you decline IBM coverage, you can enroll again during the next enrollment period, typically held each fall, or if you experience a qualified status change (such as a loss of other coverage) that would allow you to enroll during the year. Please note that the credit for No Coverage option is only available to you while you are actively employed by IBM.

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Evidence of Insurability (EOI)


Evidence of insurability (EOI), also called proof of good health, is proof acceptable to the insurance company that a participant is in good health. Generally, the participant must complete a medical questionnaire, which is then reviewed and approved by the insurance company before coverage becomes effective.

ID Cards
If you have questions about ID cards, please contact the administrator for your medical, dental or vision option. Medical: If you enroll or change your medical option, you will receive new medical ID card(s) within two to three weeks of the date you complete your enrollment. Prescription Drug: If your prescription drug benefits will be provided under the IBM Managed Pharmacy Program or a non-HMO medical option, you will receive a separate prescription drug ID card(s). Dental: If you enroll or change your dental option, you will receive new dental ID card(s) within two to three weeks of the date you complete your enrollment. Vision: If you enroll in the IBM Vision Plan or VSP Vision Card, you will receive a vision ID card two or three weeks after you enroll. Health Care Spending Account: If you will be participating in the Health Care Spending Account you will receive a Health Debit Card within two to three weeks after you enroll, along with instructions for its activation and use. Long-Term Disability and 401(k) Disability Protection: MetLife issues ID cards to those who are enrolled in IBM Long-Term Disability and/or 401(K) Disability coverage. The ID card provides a unique identifying number that can be used as an alternative to your Social Security number in the event you need to contact MetLife regarding a Long-Term Disability claim. If you have questions, contact MetLife directly at 800-638-0064.

Qualified Status Changes


A qualified status change is a specific change to your family, employment or coverage status that enables you to make certain benefit changes during the calendar year. These types of changes are defined by IRS Code Section 125 and include events like marriage, birth of a child, death, divorce, and other changes which affect benefits eligibility for you and/or your dependents. You must call the IBM Employee Services Center or log on to NetBenefits to make eligible changes to your coverage within 30 days of the date of the qualified status change; otherwise, you will not be able to make changes until the next annual enrollment period. Note: You may be required to submit proof of your qualified status change to complete the enrollment.

Who to Contact
Contact information for the carriers of your benefit plans is available via the Who to Contact link on NetBenefits, located on the bottom of the page on the Health & Insurance tab.

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This enrollment guide is intended to provide an overview of certain plans and programs in which you may participate. It is not an official Summary Plan Description and does not provide full details. Complete details are found in the formal plan documents, which are the complete and exclusive statement of the companys obligations under the plan. The official plan documents shall govern in the event of a conflict between information contained in these or other documents and statements. The plan administrator retains exclusive authority and discretion to interpret the terms of the benefits plans and programs described herein. The company reserves the right, in its sole discretion, to amend, change, suspend or terminate any benefit or other plan, program practice or policy of the company at any time. The company does not have any obligation to, and nothing contained in this enrollment guide shall be construed as creating an express or implied obligation or promise on the part of the company to, maintain, continue to offer, or make available such plans, programs, practices or policies. Eligibility to participate in a plan or program or receipt of benefits does not constitute a promise or right of continued employment or render any person an employee of IBM. IBM and its affiliated companies do not endorse any HMO or other provider, or represent or warrant the quality of care they provide. The decision to choose any health plan option or use any provider is the participants responsibility. Not all of the plans and programs within this enrollment guide pertain to all of IBMs affiliated companies. For more information, contact the IBM Employee Services Center at 800-796-9876 (TRS for deaf and hard of hearing: 800-426-6537).

3.IM-H-402A.104

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