Loading...
R-13-09-26-H6 - 9/26/2013RESOLUTION NO. R -13-09-26-H6 WHEREAS, the City of Round Rock (the "City") has previously entered into an agreement with Aetna Life Insurance Company ("Aetna") for Aetna to provide certain products to the City's self- funded employee health benefits plan (the "Plan"), said agreement being entitled "Master Services Agreement No. MSA -819919 (the "Agreement"); and WHEREAS, City now desires to enter into Amendment No. 4 to the Agreement to revise the Service Agreements and Fee Schedules, Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Mayor is hereby authorized and directed to execute on behalf of the City Amendment No. 4 to Master Services Agreement No. MSA -819919 between Aetna Life Insurance Company and the City of Round Rock regarding revisions to the Service Agreements and Fee Schedules, a copy of same being attached hereto as Exhibit "A" and incorporated herein for all purposes. The City Council hereby finds and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code, as amended. RESOLVED this 26th day of September, 2013. ATTEST: SARA L. WHITE, City Clerk 0112.1304, 00282804/SS2 ALAN MCGRAW, Mayor City of Round Rock, Texas No. 819919 Amendment 4 EXHIBIT Attached to and made a part of the Master Services Agreement MSA -819919 an agreement between Aetna Life Insurance Company (hereinafter referred to as Aetna) and the Customer City of Round Rock Nothing contained in this amendment shall be held to alter or affect any of the terms of the Services Agreement other than as herein specifically stated. It is understood and agreed that the Master Services Agreement is changed as follows: 1. The following items replace the same numbered items currently appearing on page 1 of the Service Agreement: 2. TERM Unless one party informs the other of its intent to allow the Services Agreement to terminate in accordance with Section 7 of this Master Services Agreement, the initial term of this Services Agreement shall be three (3) years beginning on January 1, 2014 (referred to as an "Agreement Period"). This Agreement may be renewed for two (2) additional periods of time not to exceed twelve (12) months each provided both parties agree in writing. 3. SERVICES Aetna shall perform only those services expressly described in this Services Agreement and Aetna's response to the requirements of the Request for Proposal City of Round Rock: RFP#13-023 Third Party Benefits Administration. In the event of a conflict between the terms of this Master Services Agreement, the attached SASs, or Aetna's response to the Request for Proposal, the order of precedence shall be as follows: First - Master Services Agreement, including the Statements of Available Services Second - Aetna's response and negotiations of Best & Final Offer Third - Aetna's initial response to the Request for Proposals Fourth - Letter of Understanding 2. The PPO Based Medical Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached PPO Based Medical Service and Fee Schedule. 3. The Dental Service and Fee Schedule currently appearing in the Master Services Agreement is replaced by the attached Dental Service and Fee Schedule. MSA Amend 4. It is understood and agreed that the Service Agreement is changed by the addition or deletion of the Statement of Available Services listed below. Statement of Available Services Added Self Funded Prescription Drug Benefits Plan Effective Date January 1, 2014 Statement of Available Services being Replaced or Removed Self Funded Prescription Drug Benefits Plan Effective Date January 1, 2010 5. The Prescription Drug Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached Prescription Drug Service and Fee Schedule. 6. The attached Service and Fee Schedule Addendum I entitled Aetna Specialty Pharmacy is hereby added to the Service Agreement. 7. The Flexible Spending Account Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached Flexible Spending Account Service and Fee Schedule. 8. The COBRA Service and Fee Schedule currently appearing in the Sexvice Agreement is replaced by the attached COBRA Service and Fee Schedule. In Witness Whereof, Aetna has signed this amendment at Hartford, Connecticut, to become effective January 1, 2014. Signed by Aetna August 30, 2013. By: Mark T. Bertolini Chairman, Chief Executive Officer and President Signed by the Customer Date Signature Official Title MSA Amend SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2016 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Any reference to "Member" shall mean a Plan Participant as defined in the Master Services Aereement. Product Per Employee* Per Month Fee - *A person within classes that are specifically described in Appendix I, including employees, retirees, COBRA continuees and any other persons including those of subsidiaries and affiliates of Customer who are reported, in writing, to Aetna for inclusion in the Services Agreement. I. Administration Services AexcelSM Choice POS II Year 1 Year 2 Year 3 $34.95 $35.63 $36.32 Services applicable and included in above PEPM fees (except where indicated otherwise) I. Administration Services Included II. Aetna Health ConnectionsSM Services Included ' Utili7ation Management Inpatient and Outpatient Precertification Included ■ Utilization Management Concurrent Review Included ■ Utili7ation Management Discharge Planning Included ■ Utili7ation Management Retrospective Review Included ■ Case Management Program Included ■ Infertility Case Management Included ■ National Medical Excellence/ Institutes of Excellence with transportation and lodging expense Included ■ MedQuerysM with Member Messaging Included ■ MedQuerysM without Member Messaging Not Included ■ Preventive Care Consideration (PCC) paper copy Not Included ■ Aetna Health Connectionssm Disease Management Included PPO Based Medical SFS • ■ ■ ■ • Healthy Outlook Programs as follows: Asthma Coronary Artery Disease Chronic Heart Failure Diabetes Not Included ■ Beginning RightsM Maternity Program Included • ■ ■ Informed Health Line as follows Nurseline 1-800# Only Included ■ Wellness Counseling Not Included ■ Healthy Body, Healthy Weight Not Included • Onsite Health Screening Services Not Included ■ Simple Steps To A Healthier Life® Induded ■ Personal Health Record CareEngine®-Powered PHR PHR Health Tracker Incentive Not Included • Focused Psychiatric Review Not Included ■ Managed Behavioral Health Included • Intensive Case Management Included • Medical/Psychiatric Case Management Not Included • Depression Disease Management Not Included • Anxiety Disease Management Not Included • Alcohol Disease Management Not Included • Quit Tobacco Not Included ■ I-Iealthy Lifestyle Coaching Not Included • High Tech Radiology Program Not Included ■ Direct2You, Aetna's Worksite Health Services Program Not Included Flexible Medical Model Not Included • Aetna's Compassionate Cares"' Program Included • ACCP Enhanced Hospice Benefits Package Not Included PPO Based Medical SFS IV. Aetna Included 30.0% of recovered amount will be retained by subrogation vendor Subrogation Program V. Group Health Included at a charge of $0.20 per employee per month Certification Services VI. National Advantage Program (NAP) National Advantage - Facility Charge Review (NAP -FCR) National Advantage - Facility Charge Review (NAP-FCR/MBB) National Advantage - Facility Charge Review (NAP-FCR/FD) National Advantage— Itemized Bill Review(IBR) Included Not Included Not Included Included National Advantage Access Fee: 50% of Aggregate Savings — Fee will be included in Plan Benefit Funding Request from Bank Aetna also may adjust Service Fees effective as of the date on which any of the following occurs. (1) If, for any product, there is a: ■ 15% decrease in the number of Employees from the number assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Number of Employees Choice POS II 767 Employees ■ 15% increase in the retiree percentage from the percentage assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Retiree Percentage AexcelsM Choice POS II 0.0% ■ 10% increase in the Member to Employee ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Ratio AexcelsM Choice POS II 2.03 Members to 767 Employees PPO Based Medical SFS (2) (3) • 15% increase in the processed claim transactions per Employee (PCTs) ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed PCT Ratio AexcelsM Choice POS II 25.4 PCTs to 767 Employees Change in Plan - A material change in Plan is initiated by the Customer or by legislative action. Change in ClaimAdministration - A material change in claim payment requirements or procedures, account structure, or any other change materially affecting the manner or cost of paying benefits. Late Payment Charges In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (i) late funds to cover Plan benefit payments (e.g., late wire transfers): 12% annual rate (ii) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. PPO Based Medical SFS SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2016 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Any reference to "Member" shall mean a Plan Participant as defined in the Master Services Agreement. Product Per Employee* Per Month Fee - *A person within classes that are specifically described in Appendix I, including employees, retirees, COBRA continues and any otherpersons including those of subsidiaries and affiliates of Customer who are reported, in writing, to Aetna for inclusion in the Services Agreement. I. Administration Services Included PPO Dental $ 3.58 Services applicable and included in above PEPM fees (except where indicated otherwise) I. Administration Services Included II. Network Access Services Included • Access to Network Providers Included ■ Minimum Plan Benefit Design Structure Set by Aetna Not Included • Online Directory Maintained by Aetna Not Included III. Dental Management Services Not Included ■ Dental Utilization Management Not Included ■ Dental/Medical Integration Not Included Aetna also may adjust Service Fees effective as of the date on which any of the following occurs. (1) If, for this product, there is a: ■ 15% decrease in the number of Employees from the number assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) PPO Dental Assumed Number of Employees 767 Employees • 15% increase in the retiree percentage from the percentage assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Retiree Percentage PPO Dental 0.0% Dental SFS (2) (3) • 15% increase in the Member to Employee ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Ratio PPO Dental 2.03 Members to 767 Employees ■ 15% increase in the processed claim transactions per Employee (PCTs) ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed PCT Ratio PPO Dental 25.4 PCTs to 767 Employees Change in Plan - A material change in Plan is initiated by the Customer or by legislative action. Change in Claim Administration - A material change in claim payment requirements or procedures, account structure, or any other change materially affecting the manner or cost of paying benefits. Late Payment Charges In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (i) late funds to cover Plan benefit payments (e.g., late wire transfers): 12% annual rate (ii) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. Dental SFS SELF FUNDED PRESCRIPTION DRUG BENEFITS PLAN STATEMENT OF AVAILABLE SERVICES EFFECTIVE 01/01/2014 Prior to the Effective Date, Customer, or Contractholder, as applicable (hereinafter "Customer") and Aetna entered into a Master Services Agreement, Administrative Services Agreement or other similar agreement which enabled Customer to make available to Plan Participants one or more products offered by Aetna under certain general terms and conditions (the "Agreement"). Customer now wishes to make available to Plan Participants the products described as Services in this Statement of Available Services (or "SAS") and accompanying Service and Fee Schedule. Unless otherwise agreed in writing, only the Services selected by Customer in the Service and Fee Schedule (as may be modified by Aetna from time to time pursuant to this Statement of Available Services) and the Agreement will be provided by Aetna. Additional Services may be provided at Customer's written request under the terms of this Statement of Available Services and the Agreement. This SAS and the Service and Fee Schedule which is incorporated by reference herein shall supersede any previous SAS or other document describing the Services herein. In the event of a conflict between the terms of this SAS and the Agreement or between the terms of this SAS and any other agreement previously entered into by Customer and Aetna, the terms of this SAS shall control. I. Excluded and/or Superseded Provisions of Agreement: A. Term Unless one party informs the other of its intent to allow this SAS to terminate in accordance with the Agreement, the initial term of this SAS shall be 3 Years beginning on the Effective Date as first written above (referred to as an "Agreement Period"). This SAS will automatically renew for additional Agreement Periods (successive one- year terms) unless otherwise terminated pursuant to the Agreement. If the Agreement does not provide a termination clause, either party may terminate this SAS by giving the other party at least thirty-one (31) days written notice stating when, after the date of such notice, such termination shall become effective. B. Benefit Funding The `Benefit Funding" or "Funding of Plan Benefits" section of the Agreement is superseded by Section IV.B.1.of this SAS. C. Audit Rights The "Audit Rights" section of the Agreement is superseded by Section VII of this SAS. II. Claim Fiduciary Customer and Aetna agree that with respect to Section 503 of the Employee Retirement Income Security Act of 1974 or state law, as applicable, as amended, Customer will be the "appropriate named fiduciary" of the Plan for the purpose of reviewing denied claims under the Plan. Customer understands that the performance of fiduciary duties under ERISA or state law, as applicable, necessarily involves the exercise of discretion on Customer's part in the determination and evaluation of facts and evidence presented in support of any claim or appeal. Therefore, and to the extent not already implied as a matter of law, Customer hereby delegates to Aetna authority to determine initialentitlement to benefits under the applicable Plan documents for each claim received. It is also agreed that, as between Customer and Aetna, Aetna's responsibilities under the Agreement are ministerial and that Aetna has no other fiduciary responsibility. III. Definitions: When used in this Statement of Available Services and/or the Self Funded Prescription Drug Benefits Plan Service and Fee Schedule, all capitalized terms shall have the following meanings: "Administrative Fees" or "Services Fees" means an amount agreed to by Customer and Aetna in consideration of the Services. RX SAS "Aetna" shall include a subsidiary, affiliate or subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Aetna Mail Order Pharmacy" means a licensed pharmacy designated by Aetna to provide or arrange for Covered Services to Plan Participants and shall include a subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Aetna Specialty Pharmacy" means a licensed pharmacy designated by Aetna to provide or arrange for Covered Services to Plan Participants and shall include a subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Average Wholesale Price" or "AWP" means the average wholesale price of a Prescription Drug as identified by Medispan (or other drug pricing service determined by Aetna). The applicable AWP for Prescription Drugs filled in (a) any Participating Pharmacy other than a mail service pharmacy will be the AWP on the date the drug was dispensed for the NDC for the package size from which the drug was actually dispensed, and (b) any mail service Participating Pharmacy will be the AWP on the date the drug was dispensed for the 11 -digit NDC for the package size from which the drug was actually dispensed. "Bank" means the bank selected by Aetna on which benefit payment costs are paid. "Benefit Cost(s)" means the cost of providing Covered Services to Plan Participants and includes amounts paid to Participating Pharmacies and other providers. Benefit Costs do not include Cost Share amounts paid by Plan Participants. Benefit Costs do not include Service Fees. The Benefit Cost includes any Dispensing Fee paid to a Participating Pharmacy or other provider for dispensing covered medications to Plan Participants. • "Benefit Plan Design" means the terms, scope and conditions for Prescription Drug or device benefits under a Plan, including Formularies, exclusions, days or supply limitations, prior authorization or similar requirements, applicable Cost Share, benefit maximums and any other features or specifications as may be included in Plan documents, as communicated by Customer to Aetna in accordance with any implementation procedures described herein. Customer shall disclose to Plan Participants any and all matters relating to the Benefit Plan Design that are required by law to be disclosed, including information relating to the calculation of Cost Share or any other amounts that are payable by a Plan Participant in connection with the Benefit Plan Design. "Brand Drug" means a Prescription Drug with a proprietary name assigned to it by the manufacturer and distributor. Brand Drug does not include those drugs classified as a Generic Drug hereunder. "Calculated Ingredient Cost" means the lesser of: a) AWP less the applicable percentage Discount; b) MAC; or c) U&C Price. The Calculated Ingredient Cost does not include the Dispensing Fee, the Cost Share or sales tax, if any. "Claim" or "Claims" means any electronic or paper request for payment or reimbursement arising from a Participating Pharmacy providing Covered Services to a Plan Participant. "Compound Prescription" means a Prescription Drug which would require the dispensing pharmacist to produce an extemporaneously produced mixture containing at least one Federal Legend drug, the end product of which is not available in an equivalent commercial form. For purposes of this Agreement, a prescription will not be considered a Compound Drug if it is reconstituted or if the only ingredient added to the prescription is water, alcohol, a sodium chloride solution or other common dilatants. "Concurrent Drug Utilization Review" or "Concurrent DUR" means the review of drug utilization when an On -Line Claim is processed by Aetna at the point of sale. RX SAS "Cost Share" means that portion of the charge for a Prescription Drug or device dispensed to a Plan Participant that is the responsibility of the Plan Participant as provided in the applicable Plan, including coinsurance, copayments, deductibles and penalties, and may be_a fixed amount or a percentage of an applicable amount. Cost Share will be calculated on the basis of the rates charged to Customer by Aetna for Covered Services except as required by law to be otherwise. "Covered Services" means Prescription Drugs, Specialty Products, over-the-counter medications or other services or supplies that are covered under the terms and conditions set forth in the description of the Plan. "Discount" means the Calculated Ingredient Cost rate or MAC to be charged by Aetna to Customer for Prescription Drugs. The Discount excludes the Dispensing Fee, Cost Share and sales tax, if any. "Dispensing Fee" means an amount agreed by Customer and Aetna in consideration of the costs associated with a Participating Pharmacy dispensing medication to a Plan Participant. "DMR Claim" means a direct member (Plan Participant) reimbursement claim. "Effective Date" means the Effective Date set forth above in the heading of the SAS. "Formulary" or "Formularies" means the list(s) of Prescription Drugs and supplies approved by the U.S. Food and Drug Administration ("FDA") developed by Aetna which classifies drugs and supplies for purposes of benefit design and coverage decisions. "Generic Drug" means a Prescription Drug, whether identified by its chemical, proprietary, or non-proprietary name that (a) is accepted by the U.S. Food and Drug Administration as therapeutically equivalent and interchangeable with drugs having an identical amount of the same active ingredient, or (b) is deemed by Aetna to be pharmaceutically equivalent and.interchangeable with drugs having an identical amount of the same active ingredient. "Implementation Credit" if applicable, is a credit provided to Customer to cover specific costs related to the transition from another vendor to Aetna and further described in the Service and Fee Schedule "Law" means any law, statute, rule, regulation, ordinance and other pronouncement having the effect of law of the United States of America, any foreign country or any domestic or foreign state, county, city or other political subdivision, or of any governmental or regulatory body, including without limitation, any court, tribunal, arbitrator, or any agency, authority, official or instrumentality of any governmental or political subdivision. "Maximum Allowable Cost" or "MAC" means the cost basis for reimbursement established by Aetna, as modified from time to time, for the same dose and form of Generic Drugs which are included on Aetna's applicable MAC List. "MAC List(s)" means the lists of MAC payment schedules for Prescription Drugs, devices and supplies identified as readily available as a Generic Drug or generally equivalent to a Brand Drug (in which case the Brand Drug may also be on the MAC List) and developed and maintained or selected by Aetna and that, in each case, are deemed to require or are otherwise capable of pricing management due to the number of drug manufacturers, utiti>ation and/or pricing volatility. "Mail Order Exception List" means the list of Prescription Drugs established by Aetna that includes Brand Drugs adjudicating as Generic Drugs, trademark Generic Drugs, any Generic Drug that is manufactured by one (1) manufacturer (or multiple manufacturers, for example, in the case of "authorized" Generic Drugs), and any Generic Drug that has an AWP within twenty-five percent (25%) of the AWP of the equivalent Brand Drug. The Mail Order Exception List is subject to change. "National Drug Code" or "NDC" means a universal product identifier for human drugs. The National Drug Code Query (NDCQ) content is limited to Prescription Drugs and a few selected OTC products. The National RX SAS Drug Code (NDC) Number is a unique, eleven -digit, three -segment number that identifies the labeler/vendor, product, and trade package size. "On -Line Claim" means a claim that (n) meets all applicable requirements, is submitted in the proper timeframe and format, and contains all necessary information, and (ii) is submitted electronically for payment to Aetna by a Participating Pharmacy as a result of provision of Covered Services to a Plan Participant. "Participating Pharmacy" means a Participating Retail Pharmacy, Aetna Mail Order Pharmacy or Aetna Specialty Pharmacy. "Participating Retail Pharmacy" means any licensed retail pharmacy that has entered into an arrangement with Aetna to provide Covered Services to Plan Participants. "Pharmacy Audits" shall have the meaning set forth in Section VII.A.1. "Plan" shall mean the self-funded employee health benefits plan for certain eligible Plan Participants pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"). "Plan Participants" shall mean employees, dependents, beneficiaries, retirees, or members as referenced in the Plan documents, or any term used by Customer to designate participants in the Plan. "Precertification" means a process under which certain drugs require prior authorization (prior approval) before Plan Participants can obtain them as a covered benefit. The Aetna Pharmacy Management Precertification Unit must receive prior notification from physicians or their authorized agents requesting coverage for medications on the Precertification List. "Prescriber" means an individual who is appropriately licensed and permitted by law to order drugs that legally require a prescription. "Prescription Drug" means a legend drug that, by Law, cannot be sold without a written prescription from an authorized Prescriber. For purposes of this Agreement, insulin, certain supplies, and devices shall be considered a Prescription Drug. "Prospective Drug Utilization Review" or "Prospective DUR" means a review of drug utilization that is performed before a prescribed medication is covered under a Plan. "Rebates" shall mean certain monetary distributions made to Customer by Aetna under the pharmacy benefit and funded from retrospective amounts paid to Aetna (i) pursuant to the terms of an agreement with a pharmaceutical manufacturer, (ii) in consideration for the inclusion of such manufacturer's drug(s) on Aetna's Formulary, and (iii) which are directly related and attributable to, and calculated based upon, the specific and identifiable utilisation of certain Prescription Drugs by Plan Participants. "Rebate Contract Excerpts", if any, shall have the meaning set forth in Section VII. "Rebate Guarantee" means the Rebate amount that Aetna guarantees Customer will receive as set forth in the Service and Fee Schedule. "Retrospective Drug Utilization Review" or "Retrospective DUR" means a review of drug utilization that is performed after a Claim for Covered Services is processed. "Service and Fee Schedule" means a document entitled same and incorporated herein by reference setting forth certain guarantees (if applicable), underlying conditions and other financial information relevant to Customer. "Services" shall have the meaning set forth in Section IV.A.1. RX SAS "Specialty Products" means those injectable and non -injectable Prescription Drugs, other medicines, agents, substances and other therapeutic products that are designated in the Service and Fee Schedule and modified by Aetna from time to time in its sole discretion as Specialty Products on account of their having particular characteristics, including one or more of the following: (a) they address complex, chronic diseases with many associated co -morbidities (e.g., cancer, rheumatoid arthritis, hemophilia, multiple sclerosis), (b) they require a greater amount of pharmaceutical oversight and clinical monitoring for side effect management and to limit waste, (c) they have limited pharmaceutical supply chain distribution as determined by the drug's manufacturer and/or (d) their relative expense. "Step -Therapy" means a type of Precertification under which certain medications will be excluded from coverage unless the Plan Participant tries one or more "prerequisite" drug(s) first, or unless a medical exception forcoverage is obtained. "Termination Notice Date", if applicable, shall have the meaning set forth in Section VI. "Usual and Customary Retail Price" or "U&C Price" means the cash price less all applicable customer discounts which Participating Pharmacy usually charges customers for providing pharmaceutical services. "Wholesale Acquisition Cost" or "WAC" means the wholesale acquisition cost of a prescription drug as listed in the Medispan weekly price updates (or any other similar publication designated by Aetna) received by Aetna. IV. Administration Services: Subject to the terms and conditions of this Statement of Available Services, the Services to be provided by Aetna, as well as certain Customer obligations in connection thereto, are described below. A. General Responsibilities and Obligations 1. Services Customer will purchase and Aetna will provide to Customer the services designated in this Statement of Available Services, if selected in the Service and Fee Schedule, and such other services Customer requests of Aetna and Aetna agrees in writing to perform, as further described herein (the "Services"). Customer acknowledges that Aetna may utili'e the services of external reviewers or contractors in performing these Services. The Services to be provided by Aetna and the Service Fees may be adjusted by Aetna effective on the commencement of any Agreement Period, or at other times as indicated in the Service and Fee Schedule. 2. Customer's Responsibilities Customer shall perform the obligations set forth in the Agreement and in this Statement of Available Services, including without limitation, the Service and Fee Schedule. 3. Exclusivity During the term of this Statement of Available Services, Customer shall use Aetna as the exclusive provider of the Benefit Plan Design, including without litnitation, pharmacy claims processing, pharmacy network -management, clinical programs, formulary management and rebate management. All terms under this Statement of Available Services and on the attached Service and Fee Schedule are conditioned on Aetna's status as the exclusive provider of the Benefit Plan Design. Any failure by Customer to comply with this Section shall constitute a material breach of this Statement of Available Services and the Agreement. Without limiting Aetna's other rights or remedies, in the event Customer fails to comply with this Section, Aetna shall have the right to modify the terms and conditions of this Statement of Available Services, including without limitation, the financial terms set forth in the Service and Fee Schedule and any Performance Guarantees attached hereto. RX SAS B. Pharmacy Benefit Management Services 1. Pharmacy Claims Processing a. On -Line Claims Processing. Using Aetna's normal claim determination, payment and audit procedures and applicable cost control standards in a manner consistent with the terms of the description of Plan benefits and this Statement of Available Services, Aetna will perform claims processing services for Covered Services that are provided by a Participating Pharmacy after the Effective Date, and submitted electronically to Aetna's on-line claims processing system. On -Line Claim processing services shall include confirmation of coverage, performance of drug utilization review activities pursuant to this Statement of Available Services, determination of Covered Services, and adjudication of the On -Line Claims. Aetna or Customer, as applicable, shall have ultimate and final responsibility for all decisions with respect to coverage of an On -Line Claim and the benefits allowed under the Plan as set forth in the Agreement. b. DMR Claims Processing. If specified on the description of Plan benefits, Aetna will process DMR Claims using Aetna's normal claim determination, payment and audit procedures and applicable cost control standards in a manner consistent with the terms of the description of Plan benefits. The Plan Participant or Medicaid agency where applicable, shall be responsible for submitting DMR Claims directly to Aetna on such form(s) provided by Aetna within the timeframe specified on the description of Plan benefits. Aetna will process DMR Claims and, where appropriate, will reimburse such Plan Participant or Medicaid agency on behalf of Customer the lesser of: (i) the amount invoiced and indicated on such DMR Claim; or (ii) the amount the Plan Participant is entitled to be reimbursed for such claim pursuant to the description of Plan benefits. With respect to any Plan Participant who submits a DMR Claim which is denied on behalf of Customer, Aetna will notify said Plan Participant of the denial and of said Plan Participant's right of review of the denial in accordance with ERISA. Aetna or Customer, as applicable, shall have ultimate and final responsibility for all decisions with respect to coverage of a DMR Claim and the benefits allowed under the Plan as set forth in the Agreement. c. Additional Services Related to Claims Processing. Whenever Aetna determines that benefits and related charges are payable under the Plan, Aetna will issue a payment of such benefits and related charges on behalf of Customer. Plan benefit payments and related charges of any amount payable under the Plan shall be made by check drawn by Aetna payable through the Bank or by electronic funds transfer or other reasonable transfer method. Customer, by execution of the Agreement, expressly authorizes Aetna to issue and accept such checks on behalf of Customer for the purpose of payment of Plan benefits and other related charges. Customer agrees to provide funds through its designated bank sufficient to satisfy all Plan benefits (and which also may include Service Fees and any late charges under the Agreement) and related charges upon notice from Aetna or the Bank of the amount of payments made by Aetna. Customer agrees to instruct its bank to forward an amount in. Federal funds on the day of the request equal to such liability by wire transfer or such other transfer method agreed upon between Customer and Aetna. As used herein "Plan benefits" means payments under the Plan, excluding any copayments, coinsurance or deductibles required by the Plan. Aetna reserves the right to place stop payments on all outstanding benefit checks (i.e., checks which have not been presented for payment) on the sooner of: (A) one (1) year following the date Aetna completes its runoff processing obligations; or (B) five (5) days following Customer's failure to provide requested funds or pay Service Fees due in accordance with the Termination section of the Agreement. RX SAS d. Where the Plan contains a coordination of benefits clause or antiduplication clause, Aetna will administer all Claims consistent with such provisions and any information concurrently in its possession as to duplicate or primary coverage. Aetna shall have no obligation to recover sums owed to the Plan by virtue of the Plan's rights to coordinate where the Claim was incurred prior to the Effective Date. Aetna has no obligation to bring actions based on subrogation or lien rights. 2. Pharmacy Network Management a. Participating Retail Pharmacies. Aetna shall provide Plan Participants access to Participating Retail Pharmacies. Aetna shall make available an updated listing of Participating Retail Pharmacies on its internet websiteandvia its member services call center. Any additions or deletions to the network of Participating Retail Pharmacies shall be made in Aetna's sole discretion. Aetna shall provide notice to Customer of any deletions that have a material adverse impact on Plan Participants' access to Participating Retail Pharmacies. Aetna shall direct each Participating Retail Pharmacy to (a) verify the Plan Participant's eligibility using Aetna's on-line claims system, and (b) charge and collect the applicable Cost Share from Plan Participants for each Covered Service. Aetna will adjudicate On - Claims for Covered Services from Participating Retail Pharmacies using the negotiated rates that Aetna has in place with the applicable Participating Retail Pharmacy. i. Aetna shall require each Participating Retail Pharmacy to comply with Aetna's applicable network participation requirements. Aetna does not direct or otherwise exercise any control over the professional judgment exercised by any pharmacist dispensing prescriptions or providing pharmacy services. Participating Retail Pharmacies are independent contractors of Aetna and Aetna shall have no liability to Customer, any Plan Participant or any other person or entity for any act or omission of a Participating Retail Pharmacy or its agents, employees or representatives. ii Aetna shall establish and maintain policies and procedures which it may revise from time to time specifying how and when a Participating Retail Pharmacy will be audited to review compliance with such pharmacy's agreement with Aetna. The audit may be conducted by Aetna's internal auditors and/or outside auditors, and may consist of a "desktop" audit of Claims submitted by the Participating Retail Pharmacy and/or a review of prescription and other records located onsite at such pharmacy. Any overpaid or erroneously paid amounts recovered by Aetna from a Participating Retail Pharmacy pursuant to an audit shall be credited to Customer net of any fees charged by Aetna in accordance with the Service and Fee Schedule or by Aetna's designated outside auditors, as applicable. Aetna shall attempt recovery of overpayments or payments made in error through offsets or demand of amounts due. In no event will Aetna be required to initiate litigation to recover any overpayments or payments made in error. iii. Aetna shall adjudicate each On -Line Claim for services rendered by a Participating Retail Pharmacy at the applicable Discount and Dispensing Fee negotiated between Aetna and Customer. For the avoidance of doubt, the Benefit Cost paid by Customer in connection with On -Line Claims for services rendered by Participating Retail Pharmacies may or may not be equal to the Discount and Dispensing Fees negotiated between Aetna and such pharmacies. b. Aetna Mail Order Pharmacy. Aetna shall provide Plan Participants with access to the Aetna Mail Order Pharmacy. Aetna shall make available information regarding how Plan Participants may access and use the Aetna Mail Order Pharmacy on its internet website and via its member services call center. The Aetna Mail Order Pharmacy shall verify the Plan Participant's eligibility using Aetna's on- line claims system, and shall charge and collect the applicable Cost Share from Plan Participants for each Covered Service. The Aetna Mail Order Pharmacy generally will require that medications and supplies be dispensed in quantities not to exceed a 90 -day supply, unless otherwise specified in the description of Plan benefits. If the prescription and applicable Law do not prohibit substitution of a Generic Drug equivalent, if any, for the prescribed drug, or if the Aetna Mail Order Pharmacy obtains consent of the Prescriber, the Aetna Mail Order Pharmacy shall require that the Generic Drug equivalent be dispensed to the Plan Participant. Certain Specialty Drugs, some acute drug RX SAS products or certain compounds cannot be ordered through the Aetna Mail Order Pharmacy. The Aetna Mail Order Pharmacy shall make refill reminder and on-line ordering services available to Plan Participants. Aetna and/or the Aetna Mail Order Pharmacy may promote the use of the Aetna Mail Order Pharmacy to Plan Participants through informational mailings, coupons or other financial incentives at Aetna's and/or the Aetna Mail Order Pharmacy's cost, unless otherwise agreed upon by Aetna and Customer. c. Aetna Specialty Pharmacy. Aetna shall provide Plan Participants with access to the Aetna Specialty Pharmacy. Aetna shall make available information regarding how Plan Participants may access and use the Aetna Specialty Pharmacy on its internet website and via its member services call center. The Aetna Specialty Pharmacy shall verify the Plan Participant's eligibility using Aetna's on-line claims system, and shall charge and collect the applicable Cost Share from Plan Participants for each Covered Service. The Aetna Specialty Pharmacy generally will require that Specialty Drug medications and supplies be dispensed in quantities not to exceed a 30 -day supply, unless otherwise specified in the description of Plan benefits. If the prescription and applicable Law do not prohibit substitution of a Generic Drug equivalent, if any, to the prescribed drug, or if the Aetna Specialty Pharmacy obtains consent of the Prescriber, the Aetna Specialty Pharmacy shall require that the Generic Drug equivalent be dispensed to the Plan Participant. The Aetna Specialty Pharmacy shall make refill reminder services available to Plan Participants. Aetna and/or the Aetna Specialty Pharmacy may promote the use of the Aetna Specialty Pharmacy to Plan Participants through informational mailings, coupons or other financial incentives at Aetna's and/or the Aetna Specialty Pharmacy's cost, unless otherwise agreed upon by Aetna and Customer. Further information regarding Specialty Product pricing and limitations is provided in the Service and Fee Schedule. 3. Clinical Programs a. Formulary Management. Aetna shall implement the Formulary and Aetna's formulary management programs, which may include cost containment initiatives and formulary education programs. Customer hereby elects to adopt the Formulary for use with the Plan. Subject to the terms and conditions set forth in this Statement of Available Services, Aetna grants Customer the right to use the Formulary during the term of this Statement of Available Services solely in connection with the Plan, and to distribute or make the Formulary available to Plan Participants. Customer acknowledges and agrees that it has sole discretion and authority to accept or reject the Formulary for the Plan. Customer further acknowledges and agrees that the Formulary is subject to change at Aetna's sole discretion as a result of a variety of factors, including without limitation, market conditions, clinical information, cost, rebates and other factors. Customer also acknowledges and agrees that the Formulary is the Confidential Information of Aetna and is subject to the requirements set forth in this Statement of Available Services and the Agreement. b. Prospective Drug Utilisation Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits the Prospective DUR program, which may include Precertification and Step -Therapy programs and other Aetna standard Prospective DUR programs, with respect to On -Line Claims. Under these programs, Plan Participants must meet standard Aetna clinical criteria before coverage of the Prescription Drugs included in the program will be authorized; provided, however, that Customer authorizes Aetna to approve coverage of drugs for uses that do not meet applicable clinical criteria in the event of complications, co -morbidities and other factors that are not specifically addressed in such criteria. Aetna shall perform exception reviews and authorize coverage overrides when appropriate for such programs, and other benefit exclusions and limitations. In performing such reviews, Aetna may rely solely on diagnosis and other information concerning the Plan Participant deemed credible and supplied to Aetna by the requesting provider, applicable clinical criteria and other information relevant or necessary to perform the review. RX SAS c. Concurrent Drug Utilization Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits its standard Concurrent DUR programs with respect to On -Line Claims. Aetna's Concurrent DUR programs help Participating Pharmacies to identify potential drug interactions, duplicate drug therapy and other circumstances where prescriptions may be clinically inappropriate for Members. Aetna's Concurrent DUR programs are educational programs that are based on available clinical literature. Aetna's Concurrent DUR programs are administered using information submitted to and available in Aetna's on-line claims system, as well as On -Line Claims information submitted by the Participating Pharmacy. d. Retrospective Drug Utilization Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits its standard Retrospective DUR programs with respect to On -Line Claims. Aetna's Retrospective DUR programs are designed to help providers and Plan Participants identify circumstances where prescription drug therapy may be clinically inappropriate or other cost- effective drug alternatives may be available. Aetna's Retrospective DUR programs are educational programs and program results may be communicated to Plan Participants, providers and plan sponsors. Aetna's Retrospective DUR programs are administered using information submitted to and available in Aetna's on-line claims system, as well as On -Line Claims information submitted by the Participating Pharmacy. e. Aetna Rx Check Program. If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Aetna Rx Check Program. Aetna Rx Check programs use a rapid Retrospective DUR approach. Claims are systematically analyzed, often within 24 hours of adjudication, for possible physician outreach based on program algorithms. The specific outreach programs are designed to promote quality, cost-effective care in accordance with accepted clinical guidelines through mailings or telephone calls to physicians and Plan Participants. Aetna Rx Check will analyze Claims on a daily basis, identify potential opportunities for quality and cost improvements, and will notify physicians or Plan Participants of those opportunities. The physician -based Aetna Rx Check programs will identify: • Certain medications that may duplicate each other's effect; • Certain drug to drug interactions; • Multiple prescriptions and/or Prescribers for certain medications with the potential for misuse; ■ Prescriptions for a multiple daily dose of a targeted Prescription Drug when symptoms might be controlled with a once -daily dosing; and ■ Plan Participants who have filled prescriptions for brand-new medications that have an A -rated generic equivalent available that could save members money. Another Aetna Rx Check program will notify Plan Participants in selected plans with mail-order drug benefits when they can save money by filling maintenance prescriptions at Aetna Rx Home Delivery versus filling prescriptions at a Participating Retail Pharmacy. f. Save-A-Copays^t: If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Save-A-Copay program. Aetna's Save-A-Copay program is designed to encourage Plan Participants to use Generic Drugs, where appropriate and with the approval of their physician. If Plan Participants switch to a generic alternative from a brand-name product, the Plan Participant Cost Share is reduced for a six month period. In such circumstances, the Customer incurs an additional cost for such Claim equal to the amount the Cost Share is reduced. RX SAS g. Disease Management Educational Program. If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Disease Management Educational Program. The Disease Management Educational Program is available to Customers who purchase Aetna managed prescription drug benefit management services, but not Aetna medical benefit plan services. The program consists of Plan Participant identification and outreach based on active Claims analysis for targeted risk conditions, such as asthma and diabetes. Upon identification, Plan Participants will receive a welcome kit introducing the program, complete with important information including educational materials and resources. Customer may choose either the Asthma or Diabetes program or a combination of the two programs. h. Disclaimer Regarding Clinical Programs. Aetna's clinical programs do not dictate or control providers' decisions regarding the treatment of care of Plan Participants. Aetna assumes no liability from Customer or any other person in connection with these programs, including the failure of a program to identify or prevent the use of drugs that result in injury to a Plan Participant. 4. Plan Participant Services and Programs Internet services including Aetna Navigator and Aetna Pharmacy Website. Through Aetna Navigator, Plan Participants have access to the following: ■ Estimating the cost of Prescription Drugs. ■ Prescription Comparison Tool — Compares the estimated cost of filling prescriptions at a Participating Retail Pharmacy to Aetna's Rx Iome Delivery mail-order prescription service. ■ Preferred Drug List — Available for Plan Participants who wish to review prescribed medications to verify if any additional coverage requirements apply. ■ View drug alternatives for medications not on the Preferred Drug List. ■ Claim information and EOBs. Through the Aetna Pharmacy website, Plan Participants have access to the following: ■ Find -A -Pharmacy — This service helps locate an Aetna participating chain or independent pharmacy on hundreds of medications and herbal remedies. • Tips on drug safety and prevention of drug interactions. • Answers to commonly asked questions about prescription drug benefits and access to educational videos. ■ Preferred Drug List and Generic Substitution List. ■ Step Therapy List. 5. Rebate Administration a. Customer acknowledges that Aetna contracts for its own account with pharmaceutical manufacturers to obtain Rebates attributable to the utilization of certain prescription products by Plan Participants who receive benefits from Customers for whom Aetna provides pharmacy benefit management services. Subject to the terms and conditions set forth in this Statement of Available Services, including without limitation, Aetna inay pay to Customer Rebates based on the utilization by Plan Participants of rebateable Prescription Drugs administered and paid through the Plan Participant's pharmacy benefits. RX SAS b. If Customer is eligible to receive Rebates under this Statement of Available Services, Customer acknowledges and agrees that Aetna shall retain the interest (if any) on, or the time value of, any Rebates received by Aetna prior to Aetna's payment of such Rebates to Customer in accordance with this Statement of Available Services. Aetna may delay payment of Rebates to Customer to allow for final adjustments or reconciliation of Service Fees or other amounts owed by Customer upon termination of this Statement of Available Services. c. If Customer is eligible to receive a portion of Rebates under this Statement of Available Services, Customer acknowledges and agrees that such eligibility under paragraphs a. and b. above shall be subject to Customer's and its affiliates', representatives' and agents' compliance with the terms of this Statement of Available Services, including without limitation, the following requirements: i. Election of, and compliance with, Aetna's Formulary; ii. Adoption of and conformance to certain benefit plan design requirements related to the Formulary as described in Service and Fee Schedule; iii. Distribution of the Formulary (or a summary thereof) to Plan Participants and/or physicians, as applicable; and iv. Compliance with other generally applicable requirements for participation in Aetna's rebate program, as communicated by Aetna to Customer from time to time. Customer further acknowledges and agrees that if itis eligible to receive a portion of Rebates under this Statement of Available Services, such eligibility shall be subject to the condition that Customer, its affiliates, representatives and agents do not contract directly or indirectly with any other person or entity for discounts, utilization limits, Rebates or other financial incentives on pharmaceutical products or formulary programs for Claims processed by Aetna pursuant to this Agreement, without the prior written consent of Aetna. Without limiting Aetna's right to other remedies, failure by Customer to obtain Aetna's prior written consent in accordance with the immediately preceding sentence shall constitute a material breach of the Agreement, entitling Aetna to (a) suspend payment of Rebates hereunder and to renegotiate the terms and conditions of this Agreement, and/or (b) immediately withhold any Rebates earned by, but not yet paid to, Customer as necessary to prevent duplicative Rebates on such drugs. C. General Administration Services 1. Eligibility Transmission The Service Fees set forth under the Service and Fee Schedule assume that Customer will provide eligibility information monthly, or more frequently, from one (1) location by electronic connectivity. Submission of eligibility information by more than one Location or via multiple methods will result in additional charges to Customer as determined by Aetna. Costs associated with any custom programming necessary to accept eligibility information from Customer are excluded from the Service Fees set forth in the Service and Fee Schedule. Customer has the sole and complete authority to determine eligibility of persons to participate in the Plan. 2. Customer Services a. Aetna will assign an Account Executive to Customers account. The Account Executive will be available to assist Customer in connection with the general administration of the Services, ongoing communications with Customer and assistance in claims administration and record-keeping systems for Customer's ongoing operation of the Plan. RX SAS b. Upon request by Customer and consent by Aetna, Aetna will implement changes in Claims administration consistent with Customer's modifications of its Plan. A charge may be assessed for implementing such changes. Customer's Services Fees, as set forth in the Service and Fee Schedule, will be revised if the foregoing amendments or modifications increase Aetna's costs. c. Aetna will provide the following reports to Customer for no additional charge: i. Monthly/Quarterly/Annual Accounting Reports - Aetna shall prepare the following accounting reports in accordance with the benefit -account structure for use by Customer in the financial management and administrative control of the Plan benefits: • a monthly listing of funds requested and received for payment of Plan benefits; • a monthly reconciliation of funds requested to Claims paid within the benefit -account structure; ■ a monthly or quarterly or annual listing of paid benefits; and • quarterly or annual standard claim analysis reports. ii. Annual Accounting Reports - Aetna shall prepare standard annual accounting reports for each major benefit line under the Plan for the Agreement Period that include the following: • forecast of Claim costs; ■ accounting of experience; and ■ calculation of Customer reserve. Any additional reporting formats and the price fon any such reports shall be mutually agreed upon by Customer and Aetna. d. Customer shall adopt Aetna's administrative and record keeping systems, including the production of Plan Participant identification cards. e. Aetna shall design and install a benefit -account structure separately by class of employees, division, subsidiary, associated company, or other classification reasonably desired by Customer. f. Aetna shall provide plan design and underwriting services in connection with benefit revisions, additions of new benefits and extensions of coverage to new Plan Participants. g. Aetna shall provide cost estimates and actuarial advice for benefit revisions, new benefits and extensions of coverage being considered by Customer. h. Upon request of Customer, Aetna will provide Customer with information reasonably available to Aetna which is reasonably necessary for Customer to prepare reports for the United States Internal Revenue Service and Department of Labor. Upon request, Aetna shall provide the following Plan description services: (i). Upon request of Customer, Aetna shall prepare an Aetna standard Plan description, including benefit revisions, additions of new benefits, and extension of coverage under the Plan. If the Customer elects to have an Aetna non-standard Plan description, Aetna will provide a custom Plan description with all costs borne by Customer; or (ii) Upon request of Customer, Aetna will review Customer -prepared employee Plan descriptions, subject to the Customer's final and sole authority regarding benefits and provisions in the self- insured portion of the Plan. Customer acknowledges its responsibility to review and approve all Plan descriptions and any revisions thereto and to consult Customer's legal counsel, at its discretion, with said review and approval. RX SAS Aetna shall have no responsibility or liability for the content of any of Customer's Plan documents, regardless of the role Aetna may have played in the preparation of such documents. If Customer requires both preparation (a) and review (b), there may be an additional charge. j. Upon request by Customer, Aetna will arrange for the printing of Plan descriptions, with all costs borne by Customer. k. Upon request by Customer, Aetna will arrange for the custom printing of forms and identification cards, with all costs borne by Customer. V. Important Information about the Pharmacy Benefit Management Services A. Customer acknowledges that Aetna contracts for its own account with pharmaceutical manufacturers to obtain Prescription Drug Formulary Rebates directly attributable to the utili7ation of certain Prescription Drugs by Plan Participants who receive Covered Services. The Rebate amounts negotiated by Aetna with pharmaceutical manufacturers vary based on several factors, including the volume of utilization, benefit plan design, and Formulary or preferred coverage terms. Aetna may offer Customer an amount of Rebates on Prescription Drugs that are administered and paid through the Plan Participant's pharmacy benefit. These Rebates are earned when members use drugs listed on Aetna's Formulary and preferred Specialty Products. Aetna determines each customer's Rebates based on actual Plan Participant utili7ation of those Formulary and preferred Specialty Products for which Aetna also has manufacturer Rebate contracts. The amount of Rebates will be determined in accordance with the terms set forth in Customer's Pharmacy Service and Fee Schedule. Rebates for Specialty Products that are administered and paid through the Plan Participant's medical benefit rather than the Plan Participant's pharmacy benefit will be retained by Aetna as compensation for Aetna's efforts in administering the preferred Specialty Products program. Pharmaceutical rebates earned on Prescription Drugs and Specialty Products administered and paid through the Plan Participant's pharmacy benefits represent the great majority of Rebates. A report indicating the Plan's Rebate payments, broken down by calendar quarter, is included with each remittance received under the program, and is also available upon request. Remittances are distributed as outlined in the Pharmacy Service and Fee Schedule. Interest (if any) received by Aetna prior to allocation to eligible self-funded customers is retained by Aetna. Any material plan changes impacting administration, utilization or demographics may impact Rebate projections and actual Rebates received. Aetna reserves the right to terminate or change this program prior to the end of any Agreement Period for which it is offered if: (a) there is any legal, legislative or regulatory action that materially affects or could affect the manner in which Aetna conducts its Rebate program; (b) any material manufacturer Rebate contracts with Aetna are terminated or modified in whole or in part; or (c) the Rebates actually received under any material manufacturer Rebate contract are less than the level of Rebates assumed by Aetna for the applicable Agreement Period. If there is any legal action, law or regulation that prohibits, or could prohibit, the continuance of the Rebate program, or an existing law is interpreted to prohibit the program, the program shall terminate automatically as to the state or jurisdiction of such law or regulation on the effective date of such lav, regulation or interpretation. RX SAS B. Customer acknowledges that from time to time, Aetna receives other payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates and which are paid separately to Aetna or designated third parties (e.g., mailing vendors, printers). These payments are to reimburse Aetna for the cost of various educational programs. These programs are designed to reinforce Aetna's goals of maintaining access to quality, affordable health care for Plan Participants and Customer. These goals are typically accomplished by educating physicians and Plan Participants about established clinical guidelines, disease management, appropriate and cost-effective therapies, and other information. Aetna may also receive payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates as compensation for bona fide services it performs, such as the analysis or provision of aggregated information regarding utilization of health care services and the administration of therapy or disease management programs. These other payments are unrelated to the Prescription Drug Formulary Rebate arrangements, and serve educational as well as other functions. Consequently, these payments are not considered Rebates, and are not included in the Rebates provided to Customer, if any. C. Customer acknowledges that in evaluating clinically and therapeutically similar Prescription Drugs for selection for the Formulary, Aetna reviews the costs of Prescription Drugs and takes into account Rebates negotiated between Aetna and Prescription Drug manufacturers. Consequently, a Prescription Drug may be included on the Formulary that is more expensive than a non -Formulary alternative before any Rebates Aetna may receive from a Prescription Drug manufacturer are taken into account. In addition, certain Prescription Drugs may be chosen for Formulary status because of their clinical or therapeutic advantages or level of acceptance among physicians even though they cost more than non -Formulary alternatives. The net cost to Customer for Covered Services will vary based on: (i) the terms of Aetna's arrangements with Participating Pharmacies; (ii) the amount of the Cost Share obligation under the terms of the Plan; and (iii) the amount, if any, of Rebates to which Customer is entitled under this Statement of Available Services and Service and Fee Schedule. As a result, Customer's actual claim expense per prescription fora particular Formulary Prescription Drug may in some circumstances be higher than for a non-Forrnulary alternative. In Plans with Cost Share tiers, use of Formulary Prescription Drugs generally will result in lower costs to Plan Participants. However, where the Plan utilizes a Cost Share calculated on a percentage basis, there could be some circumstances in which a Formulary Prescription Drug would cost the Plan Participant more than a non -Formulary Prescription Drug because: (i) the negotiated Participating Pharmacy payment rate for the Formulary Prescription Drug may be more than the negotiated Participating Pharmacy payment rate for the non -Formulary Prescription Drug; and (ii) Rebates received by Aetna from Prescription Drug manufacturers are not reflected in the cost of a Prescription Drug obtained by a Plan Participant. D. Customer acknowledges that Aetna contracts with Participating Retail Pharmacies directly or through a pharmacy benefit management ("PBM") subcontract to provide Customer and Plan Participants with access to Covered Services. The prices negotiated and paid by Aetna or PBM to Participating Retail Pharmacies vary among Participating Retail Pharmacies in Aetna's network, and can vary from one pharmacy product, plan or network to another. Under this Statement of Available Service and Service and Fee Schedule, Customer and Aetna have negotiated and agreed upon a uniform or "lock -in" price to be paid by Customer for all claims for Covered Services dispensed by Participating Retail Pharmacies. This uniform price may exceed or be less than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services. Where the uniform price exceeds the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realizes a positive margin. In cases where the uniform price is lower than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realizes a negative margin. Overall, lock -in pricing arrangements result in a positive margin for Aetna. Such margin is retained by Aetna in addition to any other fees, charges or other amounts agreed upon by Aetna and Customer, as compensation for the pharmacy benefit management services Aetna provides to Customer. Also, when Aetna receives payment from Customer before payment to a Participating Pharmacy or PBM, Aetna retains the benefit of the use of the funds between these payments. RX SAS E. Customer acknowledges that Covered Services under a Plan may be provided by Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy. In such circumstances, Aetna Mail Order Pharmacy refers to Aetna Rx Home Delivery, LLC, and Aetna Specialty Pharmacy refers to Aetna Specialty Pharmacy, LLC, both of which are subsidiaries of Aetna that are licensed Participating Pharmacies. Aetna's negotiated reimbursement rates with Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy, which are the rates made available to Customer, generally are higher than the pharmacies' cost of fulfilling orders of Prescription Drugs and Specialty Products and providing Covered Services and therefore these pharmacies realize an overall positive margin for the Covered Services they provide. To the extent Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy purchase Prescription Drugs and Specialty Products for their own account, the cost therefor takes into account both up -front and retrospective purchase discounts, credits and other amounts that they may receive from wholesalers, manufacturers, suppliers and distributors. Such purchase discounts, credits and other amounts are negotiated by Aetna Mail Order Pharmacy, Aetna Specialty Pharmacy or their affiliates for their own account and are not considered Rebates paid to Aetna by manufacturers in connection with Aetna's Rebate program. F. Customer acknowledges that Aetna generally pays Participating Pharmacies (either directly or through PBM) for Brand Drugs whose patents have expired and their Generic Drug equivalents at a single, fixed price established by Aetna (Maximum Allowable Cost or MAC). MAC pricing is designed to help promote appropriate, cost-effective dispensing by encouraging Participating Pharmacies to dispense equivalent Generic Drugs where clinically appropriate. When a Brand Drug patent expires and one or more generic alternatives first become available, the price for the Generic Drug(s) may not be significantly less than the price for the Brand Drug. Aetna reviews the drugs to determine whether to pay Participating Pharmacies (or PBM) based on MAC or continue to pay Participating Pharmacies (or PBM) on a discounted fee-for-service basis, typically a percentage discount off of the listed Average Wholesale Price of the drug (AWP Discount). This determination is based in part on a comparison under both the MAC and AWP Discount methodologies of the relative pricing of the Brand and Generic Drugs, taking into account any Rebates Aetna may receive from Prescription Drug manufacturers in connection with the Brand Drug. If Aetna determines that under AWP Discount pricing the Brand Drug is less expensive (after taking into account manufacturer Rebates Aetna receives) than the generic alternative(s), Aetna may elect not to establish a MAC price for such Prescription Drugs and continue to pay Participating Pharmacies (or PBM) according to an AWP Discount. In some circumstances, a decision not to establish a MAC price for a Brand Drug and its generic equivalents dispensed by Participating Pharmacies could mean that the cost of such Prescription Drugs for Customer is not reduced. In addition, there may be some circumstances where Customer could incur higher costs for a specific Generic Drug ordered through Aetna Mail Order Pharmacy than if such Generic Drug were dispensed by a Participating Retail Pharmacy. These situations may result from: (i) the terms of Aetna's arrangements with Participating Pharmacies (or PBM); (ii) the amount of the Cost Share; (iii) reduced retail prices and/or discounts offered by Participating Pharmacies to patients; and (iv) the amount, if any, of Rebates to which Customer is entitled under the Statement of Available Services and the Service and Fee Schedule. Claims for certain Generic Drugs ordered through Aetna Mail Order Delivery that cannot be purchased from manufacturers, wholesalers and other suppliers at reduced prices typical of multi -source generic drugs are paid by Aetna at the negotiated prices applicable to Brand Drugs ordered through Aetna Mail Order Pharmacy. Examples of these Generic Drugs include Brand Drugs that are incorrectly coded as generic by the drug pricing publication used by Aetna, trademarked Generic Drugs, any Generic Drug that is manufactured by one (1) manufacturer (or multiple manufacturers in the case of "authorized" Generic Drugs), and any Generic Drug that has an AWP price within twenty-five percent (25%) of the equivalent Brand Drug. Aetna excludes Aetna Mail Order Pharmacy claims for such Generic Drugs from the reconciliation of its standard pharmacy Discount and Dispensing Fee financial guarantees. RX SAS VI. Early Termination Consequences of Early Termination Without limiting Aetna's other rights or remedies, the following shall apply in the event this Statement of Available Services is terminated (i) by Customer without cause or (ii) by Aetna with cause pursuant to the Agreement: Customer acknowledges and agrees that Aetna shall retail any Rebates earned by, but not yet paid to, Customer as of the effective date of the termination of the Statement of Available Services. VII. Audit Rights A. General Pharmacy Audit Terms and Conditions 1. Subject to the terms and conditions set forth in the Agreement and disclosures made in the Service and Fee Schedule, Customer shall be entitled to have audits performed on its behalf (hereinafter "Pharmacy Audits") to verify that Aetna has (a) processed Claims submitted by participating pharmacies or a pharmacy benefits manager under contract with Aetna, (b) paid Rebates in accordance with this Statement of Available Services and the Service and Fee Schedule. Pharmacy Audits may be performed at Aetna's Minnetonka, MN or Hartford, CT location. For purposes of this Section VII, the term "Aetna" as defined in Section III shall not include subcontractor. 2. Additional Terms and Conditions In addition to the audit terms and conditions set forth in the Agreement and the Service and Fee Schedule, the following general terms and conditions shall apply with respect to Pharmacy Audits. a. Auditor Qualifications and Requirements specific to Pharmacy Audits All Pharmacy Audits shall be performed solely by third party auditors meeting the qualifications and requirements of the Agreement, this Statement of Available Services and the Service and Fee Schedule. Customer will ensure that third party auditors conduct Pharmacy Audits on its behalf in accordance with published administrative safeguards or procedures that shall prevent the unauthorized use or disclosure to Customer or any other third party (in the Pharmacy Audit report or otherwise) of any individually identifiable information (including health care information) or financial information contained in the information to be audited. Customer and such individuals will not make or retain any record of provider negotiated rates or financial information included in the audited transactions, or payment identifying information concerning treatment of drug or alcohol abuse, mental/nervous or HIV/AIDS or genetic markers, in connection with any Pharmacy Audit. There must be no conflict of interest or past business or other relationship which would prevent the auditor from performing an independent audit to conclusion. A conflict of interest includes, but is not limited to, a situation in which the audit agent (i) is employed by an entity, or any affiliate of such entity, which is a competitor to Aetna's benefits or claims administration business or Aetna Mail Order Pharmacy or Aetna Specialty Pharmacy; (ii) has terminated from Aetna within the past 12 months; (iii) is affiliated with a vendor subcontracted by Aetna to adjudicate clainns or provide services in connection with Aetna's administration of benefits or provision of mail order or specialty pharmacy services; or (iv) is compensated in a manner which could financially intent the agent to overstate or misconstrue data. Determination of the nature of a conflict of interest shall be at the discretion of Aetna and, in any event, shall be communicated to Customer within ten (10) business days of notice of intent to audit. The auditor chosen by Customer must be mutually agreeable to both Customer and Aetna. Auditors may not be compensated on the basis of a contingency fee or a percentage of overpayments identified, in accordance with the provisions of Section 8.207 through 8.209 of the International Federation of Accountant's (IFAC) Code of Ethics For Professional Accountants (Revised 2004). Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any Audit hereunder. RX SAS b. Auditor Qualifications and Requirements specific to Rebate Audits Aetna's agreements with pharmaceutical manufacturers are subject to confidentiality agreements. Any audit of Aetna's agreements with pharmaceutical manufacturers will be conducted by (a) one of the major public accounting firms (currently the "Big 4") approved by Aetna whose audit department is a separate stand alone function of its business, or (b) a national CPA firm approved by Aetna whose audit department is a separate stand alone function of its business. Pharmacy Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any Audit hereunder. c. Closing Meeting In the event that Aetna and Customer's auditors are unable to resolve any such disagreement regarding draft Pharmacy Audit findings, either Aetna or Customer shall have the right to refer such dispute to an independent third -party auditor meeting the requirements of the Agreement, this Section VII and the Service and Fee Schedule and selected by mutual agreement of Aetna and Customer. The parties shall bear equally the fees and charges of any such independent third -party auditor, provided however that if such auditor determines that Aetna or Customer's auditor is correct, the non -prevailing party shall bear all fees and charges of such auditor. The determination by any such independent third -party auditor shall be final and binding upon the parties, absent manifest error, and shall be reflected in the final Pharmacy Audit report. B. Additional Claim and Rebate Audit Terms and Conditions 1. Rebate Audits Subject to the terms and limitations of this Statement of Available Services, the Agreement, and the Service and Fee Schedule including without limitation the general Phannacy Audit terms and conditions set forth in this Section VII, Customer shall be entitled to audit Aetna's calculation of up to 15% of the Rebates received by Customer which are attributable to the drugs most highly utilized by Plan Participants. Aetna will share the relevant portions of the applicable formulary rebate contracts, including the manufacturer names, drug names and rebate percentages for the drugs being audited. The drugs to be audited will be selected by mutual agreement of the parties. The parties will reasonably cooperate to select drugs for each audit that (a) represent the fewest unique manufacturer rebate contracts required for audit so that the selected drugs represent a maximum of 15% of Customer's Rebates; and (b) are subject to manufacturer rebate agreements that do not contain restrictions prohibiting Aetna from disclosing to Customer portions of such contracts concerning the rebates, payments or fees payable there under (hereinafter the "Rebate Contract Excerpts"). Aetna will also provide access to all documents reasonably necessary to verify that Rebates have been invoiced, calculated, and paid by Aetna in accordance with this Statement of Available Services. Prior to the commencement of a Rebate verification audit, Aetna will provide to Customer a report identifying the drugs to be included in such audit. Customer is entitled to only one annual Rebate audit. 2. Pharmacy Claim Audits. Claim audits are subject to the above referenced audit standards for Rebates in the case of a physical, on-site, Claim -based audit. In the case of electronic Claim audits that follow standard pharmacy benefit audit practices where electronic re -adjudication of Claims is requested and processed off-site, Customer may elect to audit 100% of claims. Customer is entitled to only one annual Claim audit. RX SAS VIII. Fees Administrative Fees are provided in conjunction with Aetna's Services relating to the Benefit Plan Design and summarised in the Service and Fee Schedule. IX. Financial Guarantees In conjunction with the Services provided by Aetna under this Statement of Available Services, Aetna shall provide any financial guarantees set forth in the Service and Fee Schedule. X. Performance Guarantees Any Performance Guarantees applicable to this Statement of Available Services are attached in the Performance Guarantee Appendix as referenced in the Agreement. RX SAS Benefit Plan = Effective Date 01/01/2014 Benefit Plan 3 -Tier (0) , tut • P rmaA to ,.attic Brand Drugs Guaranteed AWP Discount Year 1: AWP — 15.10% Year 1: AWP — 22.60% Year 2: AWP — 15.20% Year 2: AWP — 22.70% Year 3: AWP —15.30% Year 3: AWP — 22.80% Guaranteed Dispensing Fee / Rx Year 1: $1.50 Year 1: $0.00 Year 2: $1.50 Year 2: $0.00 Year 3: $1.50 Year 3: $0.00 Generic Drugs Guaranteed(?)Year AWP Discount Year 1: AWP — 68.00% (overall, includes MAC and non- MAC) Year 1: AWP — 70.00% 2: AWP — 68.20% (overall, includes MAC and non- MAC) Year 2: AWP — 70.20% Year 3: AWP — 68.40% (overall, includes MAC and non- MAC) Year 3: AWP — 70.40% Guaranteed Dispensing Fee / Rx Year 1: $1.50 Year 1: $0.00 Year 2: $1.50 Year 2: $0.00 Year 3: $1.50 Year 3: $0.00 (2) Retail and Mail discount includes all generics (single -source and multi -source) Administrative Fee The following administrative fee will apply: Year 1: $0.00 (PEPM ) Year 2: $0.00 ( PEPM ) Year 3: $0.00 ( PEPM ) Rebates Plan sponsor will receive the following minimum rebate guarantees: Year 1: Greater of 50.00% or $14.61 Per Brand Script Year 1: Greater of 50.00% or $49.01 Per Brand Script Year 2: Greater of 50.00% or $14.96 Per Brand Script Year 2: Greater of 50.00% or $49.83 Per Brand Script Year 3: Greater of 50.00% or $15.40 Per Brand Script Year 3: Greater of 50.00% or $47.36 Per Brand Script (0 To qualify for 3 -tier rebates, the members in this plan must be covered by a plan design which contains at least three tiers, where the first tier consists of generic drugs, the second tier consists of preferred brand drugs, and the third tier consists of non -preferred brand drugs, with a minimum $15.00 retail/$30.00 mail order copay differential between the second and third tier, or in the case of co-insurance plans a minimum 1.5 times difference in the co- insurance percentage between the second and third tier (for example, if the second tier co-insurance is 20%, the third tier co-insurance must be at least 30%); for plans that have co-insurance with minimums, there must be a minimum $15.00 retail/$30.00 mail order copay differential between the second and third tier regardless of the co- insurance percentage; if there are copay maximums, the minimum copay on the third tier must be greater than the maximum copay on the second tier. Aetna will adjudicate Claims through our retail pharmacy network at the lowest of U&C, MAC, or discounted AWP. Words beginning with capital letters shall have the meaning set forth in Section II of the Statement of Available Services. Any reference to "Member" shall mean a Plan Participant as defined in the Statement of Available Services. RX SFS Pricing Updates & New To Market Products When new Specialty Products gain FDA approval, Aetna Pharmacy Management notifies Customer on a monthly basis of the availability and projected pricing of these Specialty Products. However, whether such Specialty Products will be included as Covered Services will depend on the Customer's Plan design. Aetna Pharmacy Management also notifies Customer on a monthly basis of limited distribution Specialty Products newly available through Aetna Specialty Pharmacy. Aetna Specialty Pharmacy determines the pricing for new to market Specialty Products by considering various factors, such as acquisition cost, expected dosages, package sizes and utilization. In any case, such Specialty Products will have a minimum market introduction guarantee of AWP less 10%. Producer Compensation Aetna may pay a varying producer compensation to Customer's benefit consultant for services provided to Aetna or Customer and Customer acknowledges and consents to Aetna paying such producer compensation. Information regarding the producer compensation is available through the Customer's benefit consultant or Aetna. Assumptions The Service Fees and Services set forth herein are based on, among other things, the assumption that a total of 767 of Customer's employees will be receiving Covered Services through Aetna. If there is a change of greater than 15% of this enrollment or in the geographic, demographic or eligible mix of the population, Aetna reserves the right to revisit the structure and/or conditions of this Service and Fee Schedule. For the purposes of Discounts, the savings percentage will be calculated by dividing the AWP less the ingredient cost for the drugs dispensed by the AWP for such drugs. For each eligible prescription -drug claim, Calculated Ingredient Cost will be calculated at the lesser of the applicable MAC, or AWP Discount price in determining the Discount achieved for purposes of calculating Discounts, including 100% Plan Participant Cost Share Claims at the applicable calculated Discount prior to the application of the Plan Participant Cost Share. Cost Share will be calculated on the basis of the rates charged to Customer by Aetna for Covered Services except as required by law to be otherwise. The Generic Drug Discount includes Multi -Source Brand Products that are subject to MAC pricing. Discount and Dispensing Fee guarantees shall not apply to Compound drug claims, claims that process at U&C, direct member reimbursement (DMR) claims, and claims for products dispensed by Aetna Specialty Pharmacy. Aetna reserves the right to exclude claims for over-the-counter products, supplies, vaccines, workers compensation claims, and in-house pharmacy or 340b claims from the discount and dispensing fee guarantees. Rebates will be distributed on a Quarterly basis. Rebate allocations will be made within 180 days from the end of such allocation period. Rebates are not available for Claims arising from Participating Pharmacies dispensing Prescription Drugs subject to either their (i) own manufacturer rebate contracts or (ii) participation in the 340B Drug Pricing Program codified as Section 340B of the Public Health Service Act or other Federal government pharmaceutical purchasing program. Customer shall adopt the Aetna Formulary in order to be eligible to receive Rebates as provided in the Service and Fee Schedule as set forth herein unless otherwise agree upon by Customer and Aetna. Rebates are paid on Specialty Products dispensed through Participating Pharmacies and covered under the Plan. Rebate, Discount and Dispensing Fee Guarantees are based on the Plan in effect and as disclosed to Aetna during any Agreement Period. Accordingly, if Customer fails to disclose to Aetna that it employs, or intends to employ, a consumer driven health plan, major cost sharing changes, any utilization management program promoting Generic or OTC Drugs over Brand Drugs during any Agreement Period, Aetna reserves the right to adjust Guarantees. Retail and Mail Order rebate guarantee components are measured individually and reconciled in aggregate on an annual basis. Retail brand, retail generic, mail order brand and mail order generic discount guarantee components are measured individually and reconciled in aggregate on an annual basis. RX SFS Retail brand, retail generic, mail order brand and mail order generic dispensing fee guarantee components are measured individually and reconciled in aggregate on an annual basis. PPACA — Aetna reserves the right to modify its products, services, and fees, and to recoup any costs, taxes, fees, or assessments, in response to legislation, regulation or requests of government authorities. Any taxes or fees (assessments) applied to self-funded benefit plans related to The Patient Protection and Affordable Care Act (PPACA) will be solely the obligation of the plan sponsor. The pharmacy pricing that Aetna is presenting does not include any such plan sponsor liability. Aetna reserves the right to make appropriate changes to these guarantees if (a) there are any significant changes in the composition of Aetna's pharmacy network or in Aetna's pharmacy network contract compensation rates, or the structure of the pharmacy stores/chains/vendors that are contracted with Aetna, including but not limited to disruption in the retail pharmacy delivery model, and bankruptcy of a chain pharmacy, or (b) there is a change in government laws or regulations which have a significant impact on pharmacy claim costs, or (c) any material manufacturer rebate contracts with Aetna are terminated or modified in whole or in part, or (d) here is any legal action or Law that materially affects or could materially affect the manner in which Aetna administers the rebate program, or if an existing Law is interpreted so as to materially affect or potentially have a material affect on Aetna's administration of the program, or (e) there is a material change in the Plan that is initiated by the Customer which impacts Aetna's costs. Customer and Aetna agree that AWP, the underlying financial basis of the Statement of Available Services and this Service and Fee Schedule, may become modified or discontinued by means outside of the control of Customer and Aetna, thereby impairing the financial intent of the parties hereunder. In the event of such modification or discontinuance, the parties agree that Aetna, in order to preserve such financial intent, may opt to (i) change the AWP source from MediSpan to another AWP source, (ii) maintain the AWP as modified but make appropriate adjustments with Customer and/or Participating Pharmacies, or (iii) change the pricing index from AWP to another industry standard index, such as Wholesale Acquisition Cost. Aetna shall provide Customer with at least ninety (90) days written notice of the option taken by Aetna together with a sufficiently detailed explanation demonstrating how such option has preserved the parties' financial intent. If ninety (90) days notice is not practicable under the circumstances, Aetna shall provide notice as soon as practicable. If Customer disputes this explanation, the parties agree to cooperate in good faith to resolve such dispute. If (a) City Of Round Rock terminates the Agreement prior to the date the pharmacy rebate check is issued, or (b) the Agreement is terminated by Aetna for City Of Round Rock's failure to meet its obligations to fund benefits or pay administrative fees (medical or pharmacy) under the Agreement, Aetna will be entitled to deduct deferred administrative fees or other plan expenses due to the termination date from any rebate check due City Of Round Rock following the termination date. If the Aetna Pharmacy Management (APM) plan is terminated by City Of Round Rock prior to December 31, 2016, Aetna will retain any rebates earned but not issued as of the APM cancellation date. To the extent this Service and Fee Schedule is part of a proposal to Customer, the Service Fees and Services set forth herein are valid for 90 days from the date of such proposal. All guarantees and underlying conditions are subject and limited to Prescription Drugs dispensed by Participating Pharmacies. RX SFS Programs & Services Aetna offers a comprehensive suite of trend and integrated health management programs and services. Below is a list, by product, of those services and programs that are available to City Of Round Rock. This offering may change or be discontinued from time to time as we update our offering to meet the needs of the marketplace. Please note the following • Services and programs included in our quoted pricing are indicated as "Included" • Services and programs that are optional are noted as such and those that require an additional fee are indicated as "Optional Enhancement" Pharmacy Programs and Services Categories ` �� n °lrAdmiisaton .. Included / Optional Implementation Services Included Account Management Included Customer Team Services Included Banking Included Standard Communication Materials Included ID Cards Included Eligibility Included Standard Reporting Included ►o Adp inisttaiio& ..� x .._ _._ ._. r�.. _...Y Pharmacy Network Management Included Cla m $c 11%Ier ei SeeMces ; , ... .,�h,� _ ..... :... Claim Administration Included Member Services Included Aetna Rx I-Iome Delivery Included �.� ..�cv� - - �� fi �u 'atiezxtManaagenent or 3Y '-u. ,< e _. :x _ ..- . ✓_: s w . ...r 6 .. ,. . .s Y i ... - 5 'r_� , : r .. Formulary Management (Aetna Formulary) Included Custom Formulary Management - rebates are subject to change upon review $1.00 PEPM if selected Aetna Navigator Included Public Site Included Secure Site (log in). Included Find -A -Pharmacy Included InteliHealth Included ..� :%4 .'�...R .... a. 31L��. ..-,. Wil, "v... � -.a 6 ._ ma i Concurrent Drug Utilisation Review (DUR) Included Point of Care Edits Included Safety Edits Included Expanded Age Edits Included (upon customer request) Expanded Gender Edits Included (upon customer request) Enhanced Safe , Edits Included (upon customer request) '.g316ii*ei-4alsaljatt°mak V,e.. Ll 3��.a�,��. r���._;e6a"�� 'ate ' K .,+-��- , �e+�;{;a3 ._ ..;. * Controlled Substance Use Program Included Blood Glucose Monitor Included Prescription Savings Program Included ExtraCare ® Health Card Included (upon customer request) Heart Care for Life Included (upon customer request) Migraine Management Included (upon customer request) RX SFS eri Categories Included / Optional Brand to Generic Outreach Included Generic Sampling Included Brand to Generic Included Generic Launch Included Aetna Rx Ste • Included (upon customer re uest) Specialty Utilization Management including National Precertification Included Aetna Specialty Health Cares., Management Included Retail to Specialty Outreach Included Aetna Specialty CareRx: (Choice of Open Network or Preferred Network) (Please refer to Aetna Specialty Pricing Addendum for Aetna S • ecialty Pharmacy Discounts and Dispensin; Fees Aetna Rx Courtesy Starts,. Included (upon customer request) Included Aetna Rx AutoFill Included (upon customer request) Adherence to Drug Therapy Included (upon customer request) Aetna Pharmacy Advisor* Included (upon customer request) Aetna Pharmacy Advisor Diabetes Buy -Up Option* $0.13 Per Member Per Month Aetna Pharmacy Advisor Diabetes and Cardiovascular Buy -Up Option* Aetna Pharmacy Advisor All Conditions Complete Buy -Up Option* Gaps in Care $0.26 Per Member Per Month $0.38 Per Member Per Month Included (upon customer request) Preventative and Chronic Drug List Included (upon customer request) *Re • uires Aetna Rx AutoFill and Adherence to Dru : Therapy National Network Included Maintenance Choice® - Mandatory (Requires Mandatory Mail Order)* Maintenance Choice®- Incentivized (Requires Incentivized Mail Order)* Maintenance Choice® - Voluntary* Included (upon customer request) Included (upon customer request) Included (upon customer request) Aetna Rx Value Network* Included (upon customer request) Aetna Rx Preferred Network* Included (upon customer request) Aetna Rx Choice Network* (Includes National Network) Included (upon customer request) Extended Days Supply Network* (Includes National Network) Retail to Mail Outreach Included (upon customer request) Included (upon customer request) *cannot be offered together Smart Edit Technology Integrated Intelligence Included ePrior Authorization Included arg Aetna Rx Check — Expanded Offering (Includes: Acute Frequency, Brand -to -Generic, High Utilization, Therapeutic Duplication, Patient Safety, Streamlining Therapy, Therapeutic Optimization, Length of Therapy, Maximum Dose, Prescription Cascade) $0.55 Per Employee Per Month Save-A-Copay Optional at $1.00 Per Letter Per Targeted Member collected on a quarterly basis over the claim wire RX SFS Categories Aetna Healthy Actions - Rx Claim Savings Included / Optional o Care Engine Powered Condition -Based $0.25 Per Employee Per Month o Care Engine Powered Drug -Based $0.15 Per Employee Per Month o Drug Class Driven (Rx Claims Logic Only) $0.15 Per Employee Per Month Essentials Therapy Management Suite $30.00 Per Occurrence (Prior Authorization) o Precertification o Quantity Limits o Dose Optimization RX SFS Important Information About Aetna's Pharmacy Benefit Management Services Other Payments Aetna receives other payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates and which are paid separately to Aetna or designated third parties (e.g., mailing vendors, printers). These payments are to reimburse Aetna for the cost of various educational programs. These programs are designed to reinforce Aetna's goals of maintaining access to quality, affordable health care for Plan Participants and Customer. These goals are typically accomplished by educating physicians and Plan Participants about established clinical guidelines, disease management, appropriate and cost-effective therapies, and other information. Aetna may also receive payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates as compensation for bona fide services it performs, such as the analysis or provision of aggregated information regarding utilization of health care services and the administration of therapy or disease management programs. These other payments are unrelated to the Prescription Drug Formulary Rebate arrangements, and serve educational as well as other functions. Consequently, these payments are not considered Rebates, and are not included in the Rebates provided to Customer, if any. Late Payment Charges If City Of Round Rock fails to provide funds on a timely basis to cover benefit payments as provided in the Service and Fee Schedule, and/or fails to pay service fees on a timely basis provided in such Service and Fee Schedule, Aetna will assess a late payment charge. The charges for 2013 are outlined below: i Late funds to cover benefit payments (e.g., late wire transfers): 12.0% annual rate ii Late payments of Service Fees: 12.0% annual rate In addition, Aetna will make a charge to recover its costs of collection including reasonable attorney's fees. We will notify City Of Round Rock of any changes in late payment interest rates. The late payment charges described in this section are without limitation to any other rights or remedies available to Aetna under the Service and Fee Schedule or at law or in equity for failure to pay. Participating Retail Pharmacy Network Aetna contracts with Participating Retail Pharmacies directly or through a pharmacy benefit management ("PBM") subcontract to provide Customer and Plan Participants with access to Covered Services. The prices negotiated and paid by Aetna or PBM to Participating Retail Pharmacies vary among Participating Retail Pharmacies in Aetna's network, and can vary from one pharmacy product, plan or network to another. Under the Statement of Available Service and Service and Fee Schedule, Customer and Aetna have negotiated and agreed upon a uniform or "lock -in" price to be paid by Customer for all Claims for Covered Services dispensed by Participating Retail Pharmacies. This uniform price may exceed or be less than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services. Where the uniform price exceeds the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realizes a positive margin. In cases where the uniform price is lower than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realises a negative margin. Overall, lock -in pricing arrangements result in a positive margin for Aetna. Such margin is retained by Aetna in addition to any other fees, charges or other amounts agreed upon by Aetna and Customer, as compensation for the pharmacy benefit management services .Aetna provides to Customer. Also, when Aetna receives payment from Customer before payment to a Participating Pharmacy or PBM, Aetna retains the benefit of the use of the funds between these payments. RX SFS Mail -Order and Specialty Covered Services Covered Services may be provided by Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy. In such circumstances, Aetna Mail Order Pharmacy refers to Aetna Rx Home Delivery, LLC, and Aetna Specialty Pharmacy refers to Aetna Specialty Pharmacy, LLC, both of which are subsidiaries of Aetna that are licensed Participating Pharmacies. Aetna's negotiated reimbursement rates with Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy, which are the rates made available to Customer, generally are higher than the pharmacies' cost of fulfilling orders of Prescription Drugs and Specialty Products and providing Covered Services and therefore these pharmacies realize an overall positive margin for the Covered Services they provide. To the extent Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy purchase Prescription Drugs and Specialty Products for their own account, the cost therefor takes into account both up -front and retrospective purchase Discounts, credits and other amounts that they may receive from wholesalers, manufacturers, suppliers and distributors. Such purchase Discounts, credits and other amounts are negotiated by Aetna Mail Order Pharmacy, Aetna Specialty Pharmacy or their affiliates for their own account and are not considered Rebates paid to Aetna by manufacturers in connection with Aetna's Rebate program. Pharmacy Audit Rights and Limitations Aetna will share Rebate information with a qualified auditor under a strict confidentiality agreement that prohibits disclosure of such information to any third party, including Customer, and will not use such information for any purposes other than the Rebate audit. Auditor will be provided with the relevant portions of the applicable Formulary Rebate contracts, including, but not limited to, the manufacturer names, Prescription Drug names, details of all monies as defined by the term Rebate, and Rebate amounts for the Prescription Drugs being audited. The parties will reasonably cooperate to select Prescription Drugs for each audit that: (i) represent the fewest unique manufacturer Rebate contracts required for audit so that the selected drugs represent up to a maximum of 1 5% of Customer's Rebates; and (ii) are subject to manufacturer Rebate agreements that do not contain restrictions prohibiting Aetna from disclosing to Customer portions of such contracts concerning the Rebates, payments or fees payable thereunder. For purposes of this Section, the term "Aetna" as defined in Section III of the Statement of Available Services shall not include subcontractor. In addition to the above stated auditor qualification, auditor must also have no conflict of interest or past business or other relationship which would prevent the auditor from performing an independent audit to conclusion. A conflict of interest includes, but is not limited to, a situation in which the audit agent: (i) is employed by an entity, or any affiliate of such entity, which is a competitor to Aetna's benefits or Claims administration business or Aetna's mail order or specialty pharmacy businesses; (ii) is affiliated with a vendor subcontracted by Aetna to adjudicate Claims or provide services in connection with Aetna's administration of benefits or provision of mail order or specialty pharmacy services. Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any audit. Customer is entitled to only one annual Rebate audit. Claim audits are subject to the above referenced audit standards for Rebates in the case of a physical, on-site, Claim - based audit. In the case of electronic Claim audits that follow standard pharmacy benefit audit practices where electronic re -adjudication of Claims is requested and processed off-site, Customer may elect to audit 100% of Claims. Customer is entitled to only one annual Claim audit. Maximum Allowable Cost ("MAC") As part of the administration of Covered Services, Aetna maintains MAC Lists of Prescription Drug products identified as requiring pricing management due to the number of manufacturers, utilization and/or pricing volatility. Criteria for inclusion on a MAC List include whether the Prescription Drug has readily available Generic Drug equivalents and a cost basis that will allow for pricing below Brand Drug rates. Aetna maintains correlative MAC Lists based on current price references provided by drug data compendia, market pricing, availability information from Generic Drug manufacturers and other sources which are subject to change. Aetna Specialty Pharmacy Information regarding the pricing and limited distribution or restricted access of Specialty Products is set forth in Addendum I to this Service and Fee Schedule. RX SFS Aetna Specialty Pharmacy Except for the specific items listed in the Exceptions or Limited Distribution tables below, Specialty Products will have the following Discounts: Distribution Channel Standard Discounts Dispensing Fee Preferred AWP - 13.50% $0.00 Specialty Products will not be available through Aetna Rx Home Delivery. Limited Distribution Drugs Some Specialty Products may be subject to limited distribution or restricted access. This means that certain Specialty Products may only be available at one or a limited number of pharmacies. Limited distribution is generally due to (i) the FDA imposing restrictions on the distribution of a Specialty Product to certain pharmacies and (ii) special handling, coordination of care or patient education that cannot be handled by all pharmacies. While most Specialty Products may be ordered through Aetna Specialty Pharmacy, the Specialty Products listed below are currently not available. However, if Aetna receives a prescription order for any of these Specialty Products, it `will transfer the order to a Participating Pharmacy where the Specialty Products are available and inform the prescribing physician and Plan Participant of same. ADAGEN Limited Distributed Products IRESSA SABRIL ARALAST OFORTA SUCRAID ARCALYST ONSOLIS TIKOSYN BERINERT ORFADIN TYVASO CINRYZE ORTHOCLONE VENTAVIS CYSTADANE PROLASTIN VISUDYNE ELAPRASE PROMACTA XENAZINE EXJADE REMODULIN XYREM FLOLAN RETISERT ZAVESCA ILARIS RIASTAP ZEMAIRA IMPLANON PROCRIT INJ Exceptions To Standard Pricing The following Specialty Products have the Discounts shown for the Preferred distribution channel. Network Therapeutic Category Drug Name Medication Form AWP Discount Dispensing Fee ANEMIA ARANESP INJ 12.50% $0.00 ANEMIA ATGAM INJ 13.50% $0.00 ANEMIA EPOGEN INJ 13.50% $0.00 ANEMIA INFED INJ 13.50% $0.00 ANEMIA NIFEREX OR 12.50% $1.75 ANEMIA PROCRIT INJ 13.50% $0.00 ANEMIA REVLIMID OR 12.50% $1.75 ANEMIA VENOFER INJ 13.50% $0.00 ASTHMA PULMOZYME INJ 13.50% $0.00 ASTHMA TOBI OR 12.50% $1.75 ASTHMA XOLAIR INJ 12.50% $0.00 COLONY STIMULANT LEUKINE INJ 12.50% $0.00 RX SFS Addendum 1 Network Therapeutic Category Drug Name Medication Form AWP ' ` Discount,: Dispensing. Fee COLONY STIMULANT MOZOBIL INJ 13.50% $0.00 COLONY STIMULANT NEUMEGA INJ 13.50% $0.00 COLONY STIMULANT NEULASTA INJ 11.50% $0.00 COLONY STIMULANT NEUPOGEN INJ 13.50% $0.00 CROHN'S DISEASE CIMZIA INJ 13.50% $0.00 CROHN'S DISEASE REMICADE INJ 13.50% $0.00 DEEP VEIN THROMBOSIS ARIXTRA INJ 13.50% $0.00 DEEP VEIN THROMBOSIS FRAGMIN INJ 13.50% $0.00 DEEP VEIN THROMBOSIS HEPARIN INJ 13.50% $0.00 DEEP VEIN THROMBOSIS INNOHEP INJ 13.50% $0.00 DEEP VEIN THROMBOSIS LOVENOX INJ 11.50% $0.00 ENZYME REPLACEMENT ALDURAZYME INJ 12.50% $0.00 ENZYME REPLACEMENT CEREZYME INJ 11.50% $0.00 ENZYME REPLACEMENT FABRAZYME INJ 10.25% $0.00 GROWTH HORMONE GENO 1'ROPIN INJ 10.50% $0.00 GROWTH HORMONE HUMATROPE INJ 13.50% $0.00 GROWTH HORMONE NORDITROPIN INJ 13.50% $0.00 GROWTH HORMONE NUTROPIN INJ 12.50% $0.00 GROWTH HORMONE PROTROPIN INJ 17.00% $0.00 GROWTH HORMONE SAIZEN INJ 11.50% $0.00 GROWTH HORMONE SEROSTIM INJ 12.50% $0.00 GROWTH HORMONE SOMATULINE DEPOT INJ 13.50% $0.00 GROWTH HORMONE SUPPRELIN LA KIT IMPL 13.50% $0.00 GROWTH HORMONE 1'EV-TROPIN INJ 17.00% $0.00 GROWTH HORMONE ZORBTIVE INJ 13.50% $0.00 HEMOPHILIA ADVATE INJ 27.00% $0.00 HEMOPHILIA ALPHANATE INJ 29.25% $0.00 HEMOPHILIA BENEFIX INJ 14.50% $0.00 HEMOPHILIA FEIBA INJ 37.50% $0.00 HEMOPHILIA HELIXATE INJ 31.00% $0.00 HEMOPHILIA HEMOFIL INJ 37.50% $0.00 HEMOPHILIA HUMA 1E - P INJ 9.25% $0.00 HEMOPHILIA KOGENA 1'E INJ 42.50% $0.00 HEMOPHILIA MONARC INJ 29.25% $0.00 HEMOPHILIA MONOCLA1E INJ 29.25% $0.00 HEMOPHILIA MONONINE INJ 27.00% $0.00 HEMOPHILIA NOVOSEVEN INJ 29.25% $0.00 HEMOPHILIA PROPLEX T INJ 14.00% $0.00 HEMOPHILIA RECOMBINATE INJ 29.25% $0.00 HEMOPHILIA STIMATE INJ 12.50% $0.00 HEMOPHILIA XYNTHA INJ 29.25% $0.00 HEMOPHILIA ALL OTHER HEMOPHILIA NOT LIS 1'ED ABOVE INJ 11.50% $0.00 HEPATITIS ALFERON INJ 13.50% $0.00 RX SFS Addendum 1 RX SFS Addendum 1 Network AWP Discount Di • spensing' Fee Therapeutic Category Drug Name Medication Form HEPATITIS BAYGAM INJ 11.50% $0.00 HEPATITIS COPEGUS OR 12.50% $1.75 NEPA 111'1S INFERGEN INJ 17.00% $0.00 HEPATITIS HEPSERA INJ 13.50% $0.00 HEPATITIS NABI HB INJ 13.50% $0.00 HEPATITIS PEG INTRON INJ 13.50% $0.00 HEPATITIS PEGASYS INJ 13.50% $0.00 HEPATITIS REBETOL OR 12.50% $1.75 HEPATITIS REBETRON INJ 18.00% $0.00 HEPATITIS RIBAVIRIN (Generic) OR MAC $1.75 HEPATITIS RONERON-A INJ 12.50% $0.00 HEPATITIS B TYZEKA OR 12.50% $1.75 HIV / AIDS ATRIPLA OR 12.50% $1.75 HIV / AIDS FOSCAVIR INJ 17.00% $0.00 HIV / AIDS FUZEON INJ 13.50% $0.00 HIV / AIDS ISENTRESS OR 12.50% $1.75 HIV / AIDS VISTIDE INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME CARIMUNE INJ 38.00% $0.00 IlvIMUNODEFICIENCY SYNDROME FLEBOGAMMA INJ 35.00% $0.00 IMMUNODEFICIENCY SYNDROME GAMIMUNE INJ 17.00% $0.00 IMMUNODEFICIENCY SYNDROME GAMMAGARD S/D INJ 42.50% $0.00 IMMUNODEFICIENCY SYNDROME GAMMAGARD LIQUID INJ 29.25% $0.00 IMMUNODEFICIENCY SYNDROME GAMUNEX INJ 27.00% $0.00 IMMUNODEFICIENCY SYNDROME PANGLOBULIN INJ 38.00% $0.00 IMMUNODEFICIENCY SYNDROME POLYGAM INJ 48.00% $0.00 IMMUNODEFICIENCY SYNDROME PRIVIGEN . INJ 11.50% $0.00 IMMUNODEFICIENCY SYNDROME RHOGAM PLUS INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME THYMOGLOBULIN INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME VIVAGLOBIN INJ 37.50% $0.00 IMMUNODEFICIENCY SYNDROME WINRHO SDF INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME ALL OTHER IVIG NOT LISTED ABOVE INJ 11.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT ALPRAZOLAM OR 16.00% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT AZATHIOPRINE OR 16.00% $t75 RX SFS Addendum 1 Network Therapeutc Category Drug Name MedicationAWP Form ' Discount Dispensing Fee IMMUNOSUPPRESSION W/TRANSPLANT CET LCEPT OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT CYCLOSPORINE OR 16.00% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT CYTOGAM INJ 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT GENGRAF OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT IMURAN OR 12.50% $1.75 IIvIMUNOSUPPRESSION W/TRANSPLANT KEPIVANCE INJ 13.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT MYFORTIC OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT NEORAL OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT PROGRAF OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT PROGRAF INJ 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT RAPAMUNE OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE INJ 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE SOL 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE OR 12.50% $1.75 INFERTILITY BRAVELLE INJ 2L75% $0.00 INFERTILITY CETROTIDE INJ 16.75% $0.00 INFERTILITY CHORIONIC GONADOTROPIN INJ 16.75% $0.00 INFERTILITY FOLLISTIM AQ INJ 13.50% $0.00 INFERTILITY GANIRELIX INJ 16.75% $0.00 INFERTILITY GONAL F INJ 12.50% $0.00 INFERTILITY LEUPROLIDE KIT INJ 27.00% $0.00 INFERTILITY LUVERIS INJ 21.75% $0.00 INFERTILITY MENOPUR INJ 21.75% $0.00 INFERTILITY NOVAREL INJ 16.50% $0.00 INFERTILITY OVIDREL INJ 16.50% $0.00 INFERTILITY PREGNYL INJ 21.75% $0.00 INFERTILITY REPRONEX INJ 21.75% $0.00 LHRH AGONIST LUPRON INJ 13.50% $0.00 LHRH AGONIST LUPRON DEPOT INJ 13.50% $0.00 LHRH AGONIST PLENAXIS INJ 13.50% $0.00 LHRH AGONIST ZOLADEX INJ 24.00% $0.00 MULTIPLE SCLEROSIS AVONEX INJ 12.50% $0.00 MULTIPLE SCLEROSIS BETASERON INJ 11.50% $0.00 RX SFS Addendum 1 Therapeutic Category Drug Name Medication Form AWP Discount Dispensing Fee MULTIPLE SCLEROSIS COPAXONE INJ 12.50% $0.00 MULTIPLE SCLEROSIS EXTAVIA INJ 11.50% $0.00 MULTIPLE SCLEROSIS MYOBLOC INJ 13.50% $0.00 MULTIPLE SCLEROSIS REBIF INJ 12.50% $0.00 MULTIPLE SCLEROSIS TYSABRI INJ 13.50% $0.00 NEUROLOGY BOTOX INJ 9.25% $0.00 NEUROLOGY CEREBYX INJ 17.00% $0.00 NEUROLOGY DYSPORT INJ 11.50% $0.00 NEUROLOGY CLONAZEPAM OR 16.00% $1.75 NEUROLOGY LIORESAL INTRATHECAL INJ 17.00% $0.00 ONC - ANTIEMETIC ANZEMET INJ 13.50% $0.00 ONC - ANTIEMETIC ATROPINE INJ 13.50% $0.00 ONC - ANTIANEMIC CYANOCOBALAMIN INJ 13.50% $0.00 ONC - ANTIEMETIC DELTASONE OR 16.00% $1.75 ONC - ANTIEMETIC DEXAMETHASONE INJ 13.50% $0.00 ONC - ANTIEMETIC EMEND INJ 15.00% $0.00 ONC - ANTIEMETIC HYDROXYZINE OR 13.50% $1.75 ONC - ANTIEMETIC KYTRIL INJ 16.00% $0.00 ONC - ANTIEMETIC METHYLPREDNISOLONE INJ 13.50% $0.00 ONC - ANTIEMETIC PROCHLORAPDERAZINE - CP INJ 17.00% $0.00 ONC - AN I'IEMETIC TIGAN OR 13.50% $1.75 ONC - ANTIEMETIC ZOFRAN OR 12.50% $1.75 ONC ANTIHYPERCALCEMIC PAMIDRONA"1'E INJ 13.50% $0.00 ONC - CHEMOTHERAPY ALOXI INJ 13.50% $0.00 ONC - CHEMOTHERAPY ARIMIDEX OR 12.50% $1.75 ONC - CHEMOTHERAPY AVASTIN INJ 10.25% $0.00 ONC - CHEMOTHERAPY BCG LIVE INJ 13.50% $0.00 ONC - CHEMOTHERAPY BLEOMYCIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY CAMPTOSAR INJ 13.50% $0.00 ONC - CHEMOTHERAPY CASODEX OR 12.50% $1.75 ONC - CHEMOTHERAPY COSMEGEN INJ 13.50% $0.00 ONC - CHEMOTHERAPY CYTARABINE INJ 13.50% $0.00 ONC - CHEMOTHERAPY CYTOXAN INJ 12.50% $0.00 ONC - CHEMOTHERAPY DAUNORUBICIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY DOXIL INJ 13.50% $0.00 ONC - CHEMOTHERAPY DOXORUBICIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELITEK INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELIGARD INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELOXATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY ERBITUX INJ 13.50% $0.00 ONC - CHEMOTHERAPY ETHYOL INJ 13.50% $0.00 ONC - CHEMOTHERAPY ETOPOSIDE INJ 13.50% $0.00 ONC - CHEMOTHERAPY FASLODEX INJ 13.50% $0.00 RX SFS Addendum 1 Therapeutic Category Drug Name Medication Form ? AWP Discount Dispensing Fee ONC - CHEMOTHERAPY GEMZAR INJ 13.50% $0.00 ONC - CHEMOTHERAPY GLEEVEC OR 10.50% $1.75 ONC - CHEMOTHERAPY HERCEPTIN INJ 10.50% $0.00 ONC - CHEMOTHERAPY HYCAMTIN OR 12.50% $1.75 ONC - CHEMOTHERAPY HYCAMTIN INJ 12.50% $0.00 ONC - CHEMOTHERAPY HYDROXYUREA OR 16.00% $1.75 ONC - CHEMOTHERAPY INTRON A INJ 12.50% $0.00 ONC - CHEMOTHERAPY LEUCOVORIN OR 13.50% $1.75 ONC - CHEMOTHERAPY MERCAPTOPURINE OR 16.00% $1.75 ONC - CHEMOTHERAPY METHOTREXATE INJ 12.50% $0.00 ONC - CHEMOTHERAPY MUSTARGEN INJ 13.50% $0.00 ONC - CHEMOTHERAPY MITOMYCIN INJ 1150% $0.00 ONC - CHEMOTHERAPY NAVELBINE INJ 13.50% $0.00 ONC - CHEMOTHERAPY NEXAVAR OR 13.50% $1.75 ONC - CHEMOTHERAPY NOVANTRONE INJ 13.50% $0.00 ONC - CHEMOTHERAPY OCTREOTIDE INJ 13.50% $0.00 ONC - CHEMOTHERAPY PACLITAXEL INJ 13.50% $0.00 ONC - CHEMOTHERAPY PARAPLATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY PROLEUKIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY RITUXAN INJ 12.50% $0.00 ONC - CHEMOTHERAPY TAMOXIFEN OR 16.00% $1.75 ONC - CHEMOTHERAPY TARCEVA OR 11.50% $1.75 ONC - CHEMOTHERAPY TAXOTERE INJ 13.50% $0.00 ONC - CHEMOTHERAPY 1'EMODAR OR 12.50% $1.75 ONC - CHEMOTHERAPY THALOMID OR 12.50% $1.75 ONC - CHEMOTHERAPY TICE BCG INJ 13.50% $0.00 ONC - CHEMOTHERAPY SANDOSTATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY SU 1'ENT OR 14.50% $1.75 ONC - CHEMOTHERAPY VELCADE INJ 13.50% $0.00 ONC - CHEMOTHERAPY VINCRISTINE INJ 13.50% $0.00 ONC - CHEMOTHERAPY VOTRIENT OR 12.50% $1.75 ONC - CHEMOTHERAPY XELODA OR. 12.50% $1.75 ONC - CHEMOTHERAPY ZENAPAX INJ 13.50% $0.00 ONC - DIURETIC MANNITOL INJ 13.50% $0.00 ONC - HEMATOPOIETIC NEULASTA INJ 11.50% $0.00 ONC - HYPERCALCEMIC AREDIA INJ 17.00% $0.00 ONC - HYPERCALCEMIC ZOMETA INJ 1330% $0.00 OS 1'EOARTHRITIS EUFLEXXA INJ 13.50% $0.00 OS 1'EOARTHRITIS HYALGAN INJ 13.50% $0.00 OS 1'EOARTHRITIS ORTHOVISC INJ 13.50% $0.00 OS I EOARTHRITIS SUPARTZ INJ 17.00% $0.00 OSTEOARTHRITIS SYNVISC INJ 13.50% $0.00 OSTEOPOROSIS FOR 1'EO INJ 11.50% $0.00 OTHER ACTHAR GEL INJ 13.50% $0.00 RX SFS Addendum 1 Network Therapeutic Category Drug Name Medication Form AWP Discount Dispensing Fee OTHER KUVAN OR 13.50% $1.75 OTHER INCRELEX INJ 13.50% $0.00 OTHER LUCENTIS INJ 11.50% $0.00 OTHER RECLAST INJ 13.50% $0.00 OTHER RETISERT INJ 17.00% $0.00 OTHER ROCEPHIN INJ 13.50% $0.00 OTHER SOMAVERT INJ 13.50% $0.00 OTHER THYROGEN INJ 10.50% $0.00 OTHER VIVITROL INJ 10.50% $0.00 OTHER ALL OTHER INJECTABLE DRUGS NOT LIS 1'hD INJ 13.50% $0.00 OTHER TRADITIONAL ORALS, CREAMS & INHALERS OR 12.50% $1.75 OTHER COMPOUNDED MEDICATIONS & SUPPOSITORIES 16.00% $11.75 PARKINSONS APOKYN INJ 13.50% $0.00 PSORIASIS AMEVIVE INJ 13.50% $0.00 PSORIASIS SORIATANE KIT OR 12.50% $1.75 PSORIASIS S 1'hLARA INJ 11.50% $0.00 PULMONARY AR 11RIAL HYPERU NSION ADCIRCA OR 16.00% $1.75 PULMONARY ARTERIAL HYPER 1'hNSION LETAIRIS OR 12.50% $1.75 PULMONARY ARI'hRIAL HYPERTENSION TRACLEER OR 13.50% $1.75 PULMONARY FIBROSIS ACTIMMUNE INJ 12.50% $0.00 RHEUMATOID ARTHRITIS ENBREL INJ 12.50% $0.00 RHEUMATOID ARTHRITIS HUMIRA INJ 12.50% $0.00 RHEUMATOID ARTHRITIS HYDROXYCHLOROQUINE OR 16.00% $1.75 RHEUMATOID ARTHRITIS KINERET INJ 13.50% $0.00 RHEUMATOID ARTHRITIS MYOCHRYSINE INJ 17.00% $0.00 RHEUMATOID ARTHRITIS ORENCIA INJ 13.50% $0.00 RHEUMATOID ARTHRITIS SIMPONI INJ 13.50% $0.00 RSV SYNAGIS INJ 13.50% $0.00 Note: This list will be updated from time to time and may include adjunct therapies used in the treatment of complex conditions. For drugs where an AB -rated generic equivalent is available, the pricing will be according to the current MAC list. RX SFS Addendum 1 SERVICE AND FEE SCHEDULE Customer hereby elects to receive the Services designated below. The corresponding Administrative Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Fees for services performed by Aetna in accordance with the SAS will be determined by Aetna in accordance with the following. 1. In General. Fees for standard services as described in the SAS consist of (a) a monthly administration fee and (b) other fees. The corresponding Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 shall be as follows: Services Service Fees Monthly Administration Fee $ 5.50 Per Participant/Per Month Other Fees — Debit Card Fee $ 1.00 Per Participant/Per Month In general, the number of Plan Participants on which the per -Participant -per -month fee is based for any month is the sum of (1) the number of Plan Participants on the first day of the Plan Year plus (2) the number of Plan Participants that have been added during the Agreement Period. This number is determined as of the first day of each month of the Agreement Period and any Transition Period, as defined in the Appendix to this SAS. Plan Participants who terminate during a month are included in the Plan Participant count for purposes of determining that month's per - Participant fee. The fees shown above are based on administrative services selected. Aetna may adjust the Service Fees effective as of the date on which any of the following occurs: (a) If, for any Service, there is a 10% change in the number of employees participating in the health care flexible spending account and dependent care flexible spending account from the number assumed in Aetna's quotation of September 1, 2009 or from any subsequendy reset assumptions. (b) Change in Plan — A material change in the Plan is initiated by the Customer or by legislative action. (c) Change in Administration — A material change in claim payment requirements or procedures, account structure or any other change materially affecting the manner or cost of paying benefits. 2. Late Payment Charges: In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master. Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (a) late funds to cover benefit payments (e.g., late wire transfers): 12% annual rate (b) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. FSA HC/DC SFS SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Individual Billing Administration COBRA Administrative Fees Installation or Restructure Fee $1,000.00 For a direct billing arrangement setup within a control number. Payable only in the first year. A full or partial charge may also be applied for restructures after the initial setup, e.g., whenever new records must be established for existing continuees who are being moved to a new or revised control, suffix, plan or account structure. Fee Per COBRA Participant Per Month for Standard Services (2% COBRA PPPM Fee administration fee retained by Aetna) Monthly fee charged for each primary participant enrolled in COBRA $7.85 Fees For Additional Services Initial/General Notification $3.35 The Customer requests that Aetna send out notification to each newly hired employee detailing COBRA rights in the event that they or a covered family member experience a COBRA event. COBRA Qualifying Event Election Notification After the qualifying event has occurred, the Customer requests that Aetna send out enrollment notification materials to each Qualified Beneficiary. Fees vary based on method of Aetna receiving source information from Customer. Electronic File (Secure Web Transfer) Paper — standard format Maintenance of Eligibility Only Services Plan Participants maintained in the Individual Billing System for eligibility only HIPAA Certification Notices Cost per certificate mailed $7.50 $16.45 Not Applicable PPPM Fee Not Applicable Individual Billing Administration fees are billed directly to the Customer on a quarterly basis. The quarter commences with the administration effective date. COBRA SFS ROUND ROCK, TEXAS PURPOSE R16/ON PROSPERITY City of Round Rock Agenda Item Summary Agenda Number: H.6 Title: Consider a resolution authorizing the Mayor to execute Amendment No. 4 to Master Service Agreement No. MSA -819919 with Aetna Life Insurance Company for health insurance benefits. Type: Resolution Governing Body: City Council Agenda Date: 9/26/2013 Dept Director: Valerie Francois, HR Director Cost: $321,680.00 Indexes: Self -Funded Health Insurance Attachments: Resolution, Exhibit A Text of Legislative File 13-724 Item Summary: Consider a resolution authorizing the Mayor to execute a contract with Aetna Life Insurance Company for medical, dental and vision benefits for eligible City employees. Aetna will provide medical, dental, vision and pharmacy benefits to the City of Round Rock. A Request for Proposal (RFP) was issued and eight (8) responses were received. An evaluation team revieweed the proposals and selected Aetna as the vendor. Aetna is our current vendor and they were competitive in pricing and services. Cost: $321,680.00 Source of Funds: Self -Funded Health Insurance Budget Staff recommends approval City of Round Rock Page 1 Printed on 9/23/2013 EXECUTED ORIGINAL DOCUMENT FOLLOW No. 819919 Amendment 4 • Attached to and made a part of the Master Services Agreement MSA -819919 an agreement between Aetna Life Insurance Company (hereinafter referred to as Aetna) and the Customer City of Round Rock Nothing contained in this amendment shall be held to alter or affect any of the terms of the Services Agreement other than as herein specifically stated. It is understood and agreed that the Master Services Agreement is changed as follows: 1. The following items replace the same numbered items currently appearing on page 1 of the Service Agreement: 2. TERM Unless one party informs the other of its intent to allow the Services Agreement to terminate in accordance with Section 7 of this Master Services Agreement, the initial term of this Services Agreement shall be three (3) years beginning on January 1, 2014 (referred to as an "Agreement Period"). This Agreement may be renewed for two (2) additional periods of time not to exceed twelve (12) months each provided both parties agree in writing. 3. SERVICES Aetna shall perform only those services expressly described in this Services Agreement and Aetna's response to the requirements of the Request for Proposal City of Round Rock: RFP#13-023 Third Party Benefits Administration. In the event of a conflict between the terms of this Master Services Agreement, the attached SASs, or Aetna's response to the Request for Proposal, the order of precedence shall be as follows: First - Master Services Agreement, including the Statements of Available Services Second - Aetna's response and negotiations of Best & Final Offer Third - Aetna's initial response to the Request for Proposals Fourth - Letter of Understanding 2. The PPO Based Medical Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached PPO Based Medical Service and Fee Schedule. 3. The Dental Service and Fee Schedule currently appearing in the Master Services Agreement is replaced by the attached Dental Service and Fee Schedule. MSA Amend 4. It is understood and agreed that the Service Agreement is changed by the addition or deletion of the Statement of Available Services listed below. Statement of Available Services Added Self Funded Prescription Drug Benefits Plan Effective Date January 1, 2014 Statement of Available Services being Replaced or Removed Self Funded Prescription Drug Benefits Plan Effective Date January 1, 2010 5. The Prescription Drug Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached Prescription Drug Service and Fee Schedule. 6. The attached Service and Fee Schedule Addendum I entitled Aetna Specialty Pharmacy is hereby added to the Service Agreement. 7. The Flexible Spending Account Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached Flexible Spending Account Service and Fee Schedule. 8. The COBRA Service and Fee Schedule currently appearing in the Service Agreement is replaced by the attached COBRA Service and Fee Schedule. In Witness Whereof, Aetna has signed this amendment at Hartford, Connecticut, to become effective January 1, 2014. Signed by Aetna August 30, 2013. By: Mark T. Bertolini Chairman, Chief Executive Officer and President Signed by the Customer Signature MSA Amend iVl0Y— Official Title SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2016 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Any reference to "Member" shall mean a Plan Participant as defined in the Master Services Agreement. Product Per Employee* Per Month Fee - *A person within classes that are specifically described in Appendix I, including employees, retirees, COBRA continuees and any other persons including those of subsidiaries and affiliates of Customer who are reported, in writing, to Aetna for inclusion in the Services Agreement. I. Administration AexcelsM Choice POS II Year 1 Year 2 Year 3 $34.95 $35.63 $36.32 Services applicable and included in above PEPM fees (except where indicated otherwise) I. Administration Services Included II. Aetna Health ConnectionsSM Services Included ■ Utilization Management Inpatient and Outpatient Precertification Included ■ Utilization Management Concurrent Review Included • Utilization Management Discharge Planning Included ■ Utili7ation Management Retrospective Review Included • Case Management Program Included ■ Infertility Case Management Included • National Medical Excellence/ Institutes of Excellence with transportation and lodging expense Included ■ MedQuerysM with Member Messaging Included ■ MedQuerysM without Member Messaging Not Included ■ Preventive Care Consideration (PCC) paper copy Not Included ■ Aetna Health ConnectionsSM Disease Management Included PPO Based Medical SFS • ■ ■ ■ ■ Healthy Outlook Programs as follows: Asthma Coronary Artery Disease Chronic Heart Failure Diabetes Not Included ■ Beginning RightsM Maternity Program Included ■ ■ ■ Informed Health Line as follows Nurseline 1-800# Only Included ■ Wellness Counseling Not Included ■ Healthy Body, Healthy Weight Not Induded • Onsite Health Screening Services Not Included ■ Simple Steps To A Healthier Life® Included • Personal Health Record CareEngine®-Powered PHR PHR Health Tracker Incentive Not Included • Focused Psychiatric Review Not Included • Managed Behavioral Health Included • Intensive Case Management Included ■ Medical/Psychiatric Case Management Not Included ■ Depression Disease Management Not Included ■ Anxiety Disease Management Not Included ■ Alcohol Disease Management Not Included ■ Quit Tobacco Not Included ■ Healthy Lifestyle Coaching Not Included ■ High Tech Radiology Program Not Included ■ Direct2You, Aetna's Worksite Health Services Program Not Included Flexible Medical Model Not Included • Aetna's Compassionate Cares"' Program Included ■ ACCP Enhanced Hospice Benefits Package - Not Included PPO Based Medical SFS IV. Aetna Included 30.0% of recovered amount will be retained by subrogation vendor Subrogation Program V. Group Health Included at a charge of $0.20 per employee per month Certification Services VI. National Advantage Program (NAP) National Advantage - Facility Charge Review (NAP -FCR) National Advantage - Facility Charge Review (NAP-FCR/MBB) National Advantage - Facility Charge Review (NAP-FCR/FD) National Advantage— Itemized Bill Review(IBR) Included Not Included Not Included Included National Advantage Access Fee: 50% of Aggregate Savings — Fee will be included in Plan Benefit Funding Request from Bank Aetna also may adjust Service Fees effective as of the date on which any of the following occurs. (1) If, for any product, there is a: ■ 15% decrease in the number of Employees from the number assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Number of Employees Choice POS II 767 Employees • 15% increase in the retiree percentage from the percentage assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Retiree Percentage AexcelsM Choice POS II 0.0% • 10% increase in the Member to Employee ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Ratio AexcelsM Choice POS II 2.03 Members to 767 Employees PPO Based Medical SFS • 15% increase in the processed claim transactions per Employee (PCTs) ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed PCT Ratio AexcelsM Choice POS II 25.4 PCTs to 767 Employees (2) Change in Plan - A material change in Plan is initiated by the Customer or by legislative action. (3) Change in Claim'Administration - A material change in claim payment requirements or procedures, account structure, or any other change materially affecting the manner or cost of paying benefits. Late Payment Charges In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (i) late funds to cover Plan benefit payments (e.g., late wire transfers): 12% annual rate (ii) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. PPO Based Medical SFS SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2016 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Any reference to "Member" shall mean a Plan Participant as defined in the Master Services Agreement. Product Per Employee* Per Month Fee - *A person within classes that are specifically described in Appendix I, including employees, retirees, COBRA continues and any otherpersons including those of subsidiaries and affiliates of Customer who are reported, in writing, to Aetna for inclusion in the Services Agreement. I. Administration Services Included PPO Dental $ 3.58 Services applicable and included in above PEPM fees (except where indicated otherwise) I. Administration Services Included II. Network Access Services Included ■ Access to Network Providers Included ■ Minimum Plan Benefit Design Structure Set by Aetna Not Included ■ Online Directory Maintained by Aetna Not Included III. Dental Management Services Not Induded ■ Dental Utilization Management Not Included • Dental/Medical Integration Not Included Aetna also may adjust Service Fees effective as of the date on which any of the following occurs. (1) If, for this product, there is a: ■ 15% decrease in the number of Employees from the number assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) PPO Dental Assumed Number of Employees 767 Employees • 15% increase in the retiree percentage from the percentage assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Retiree Percentage PPO Dental 0.0% Dental SFS ■ 15% increase in the Member to Employee ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed Ratio PPO Dental 2.03 Members to 767 Employees • 15% increase in the processed claim transactions per Employee (PCTs) ratio from the ratio assumed in Aetna's quotation of August 30, 2013, or from any subsequently reset assumptions. Name of Product(s) Assumed PCT Ratio PPO Dental 25.4 PCTs to 767 Employees (2) Change in Plan - A material change in Plan is initiated by the Customer or by legislative action. (3) Change in Claim Administration - A material change in claim payment requirements or procedures, account structure, or any other change materially affecting the manner or cost of paying benefits. Late Payment Charges In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (i) late funds to cover Plan benefit payments (e.g., late wire transfers): 12% annual rate (ii) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. Dental SFS SELF FUNDED PRESCRIPTION DRUG BENEFITS PLAN STATEMENT OF AVAILABLE SERVICES EFFECTIVE 01/01/2014 Prior to the Effective Date, Customer, or Contractholder, as applicable (hereinafter "Customer") and Aetna entered into a Master Services Agreement, Administrative Services Agreement or other similar agreement which enabled Customer to make available to Plan Participants one or more products offered by Aetna under certain general terms and conditions (the "Agreement"). Customer now wishes to make available to Plan Participants the products described as Services in this Statement of Available Services (or "SAS") and accompanying Service and Fee Schedule. Unless otherwise agreed in writing, only the Services selected by Customer in the Service and Fee Schedule (as may be modified by Aetna from time to time pursuant to this Statement of Available Services) and the Agreement will be provided by Aetna. Additional Services may be provided at Customer's written request under the terms of this Statement of Available Services and the Agreement. This SAS and the Service and Fee Schedule which is incorporated by reference herein shall supersede any previous SAS or other document describing the Services herein. In the event of a conflict between the terms of this SAS and the Agreement or between the terms of this SAS and any other agreement previously entered into by Customer and Aetna, the terms of this SAS shall control. I. Excluded and/or Superseded Provisions of Agreement: A. Term Unless one party informs the other of its intent to allow this SAS to terminate in accordance with the Agreement, the initial term of this SAS shall be 3 Years beginning on the Effective Date as first written above (referred to as an "Agreement Period"). This SAS will automatically renew for additional Agreement Periods (successive one- year terms) unless otherwise terminated pursuant to the Agreement. If the Agreement does not provide a termination clause, either party may terminate this SAS by giving the other party at least thirty-one (31) days written notice stating when, after the date of such notice, such termination shall become effective. B. Benefit Funding The `Benefit Funding" or "Funding of Plan Benefits" section of the Agreement is superseded by Section IV.B.1.of this SAS. C. Audit Rights The "Audit Rights" section of the Agreement is superseded by Section VII of this SAS. II. Claim Fiduciary Customer and Aetna agree that with respect to Section 503 of the Employee Retirement Income Security Act of 1974 or state law, as applicable, as amended, Customer will be the "appropriate named fiduciary" of the Plan for the purpose of reviewing denied claims under the Plan. Customer understands that the performance of fiduciary duties under ERISA or state law, as applicable, necessarily involves the exercise of discretion on Customer's part in the determination and evaluation of facts and evidence presented in support of any claim or appeal. Therefore, and to the extent not already implied as a matter of law, Customer hereby delegates to Aetna authority to determine initialentitlement to benefits under the applicable Plan documents for each claim received. It is also agreed that, as between Customer and Aetna, Aetna's responsibilities under the Agreement are ministerial and that Aetna has no other fiduciary responsibility. III. Definitions: When used in this Statement of Available Services and/or the Self Funded Prescription Drug Benefits Plan Service and Fee Schedule, all capitalized terms shall have the following meanings: "Administrative Fees" or "Services Fees" means an amount agreed to by Customer and Aetna in consideration of the Services. RX SAS "Aetna" shall include a subsidiary, affiliate or subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Aetna Mail Order Pharmacy" means a licensed pharmacy designated by Aetna to provide or arrange for Covered Services to Plan Participants and shall include a subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Aetna Specialty Pharmacy" means a licensed pharmacy designated by Aetna to provide or arrange for Covered Services to Plan Participants and shall include a subcontractor of its choosing for the purposes of services to be performed under this Statement of Available Services and/or Service and Fee Schedule. "Average Wholesale Price" or "AWP" means the average wholesale price of a Prescription Drug as identified by Medispan (or other drug pricing service determined by Aetna). The applicable AWP for Prescription Drugs filled in (a) any Participating Pharmacy other than a mail service pharmacy will be the AWP on the date the drug was dispensed for the NDC for the package size from which the drug was actually dispensed, and (b) any mail service Participating Pharmacy will be the AWP on the date the drug was dispensed for the 11 -digit NDC for the package size from which the drug was actually dispensed. "Bank" means the bank selected by Aetna on which benefit payment costs are paid. "Benefit Cost(s)" means the cost of providing Covered Services to Plan Participants and includes amounts paid to Participating Pharmacies and other providers. Benefit Costs do not include Cost Share amounts paid by Plan Participants. Benefit Costs do not include Service Fees. The Benefit Cost includes any Dispensing Fee paid to a Participating Pharmacy or other provider for dispensing covered medications to Plan Participants. "Benefit Plan Design" means the terms, scope and conditions for Prescription Drug or device benefits under a Plan, induding Formularies, exclusions, days or supply limitations, prior authorization or similar requirements, applicable Cost Share, benefit maximums and any other features or specifications as may be included in Plan documents, as communicated by Customer to Aetna in accordance with any implementation procedures described herein. Customer shall disclose to Plan Participants any and all matters relating to the Benefit Plan Design that are required by law to be disclosed, including information relating to the calculation of Cost Share or any other amounts that are payable by a Plan Participant in connection with the Benefit Plan Design. "Brand Drug" means a Prescription Drug with a proprietary name assigned to it by the manufacturer and distributor. Brand Drug does not include those drugs classified as a Generic Drug hereunder. "Calculated Ingredient Cost" means the lesser of: a) AWP less the applicable percentage Discount; b) MAC; or c) U&C Price. The Calculated Ingredient Cost does not include the Dispensing Fee, the Cost Share or sales tax, if any. "Claim" or "Claims" means any electronic or paper request for payment or reimbursement arising from a Participating Pharmacy providing Covered Services to a Plan Participant. "Compound Prescription" means a Prescription Drug which would require the dispensing pharmacist to produce an extemporaneously produced mixture containing at least one Federal Legend drug, the end product of which is not available in an equivalent commercial form. For purposes of this Agreement, a prescription will not be considered a Compound Drug if it is reconstituted or if the only ingredient added to the prescription is water, alcohol, a sodium chloride solution or other common dilatants. "Concurrent Drug Utilization Review" or "Concurrent DUR" means the review of drug utilization when an On -Line Claim is processed by Aetna at the point of sale. RX SAS "Cost Share" means that portion of the charge for a Prescription Drug or device dispensed to a Plan Participant that is the responsibility of the Plan Participant as provided in the applicable Plan, including coinsurance, copayments, deductibles and penalties, and may be a fixed amount or a percentage of an applicable amount. Cost Share will be calculated on the basis of the rates charged to Customer by Aetna for Covered Services except as required by law to be otherwise. "Covered Services" means Prescription Drugs, Specialty Products, over-the-counter medications or other services or supplies that are covered under the terms and conditions set forth in the description of the Plan. "Discount" means the Calculated Ingredient Cost rate or MAC to be charged by Aetna to Customer for Prescription Drugs. The Discount excludes the Dispensing Fee, Cost Share and sales tax, if any. "Dispensing Fee" means an amount agreed by Customer and Aetna in consideration of the costs associated with a Participating Pharmacy dispensing medication to a Plan Participant. "DMR Claim" means a direct member (Plan Participant) reimbursement claim. "Effective Date" means the Effective Date set forth above in the heading of the SAS. "Formulary" or "Formularies" means the list(s) of Prescription Drugs and supplies approved by the U.S. Food and Drug Administration ("FDA") developed by Aetna which classifies drugs and supplies for purposes of benefit design and coverage decisions. "Generic Drug" means a Prescription Drug, whether identified by its chemical, proprietary, or non-proprietary name that (a) is accepted by the U.S. Food and Drug Administration as therapeutically equivalent and interchangeable with drugs having an identical amount of the same active ingredient, or (b) is deemed by Aetna to be pharmaceutically equivalent and.interchangeable with drugs having an identical amount of the same active ingredient. "Implementation Credit" if applicable, is a credit provided to Customer to cover specific costs related to the transition from another vendor to Aetna and further described in the Service and Fee Schedule "Law" means any law, statute, rule, regulation, ordinance and other pronouncement having the effect of law of the United States of America, any foreign country or any domestic or foreign state, county, city or other political subdivision, or of any governmental or regulatory body, including without limitation, any court, tribunal, arbitrator, or any agency, authority, official or instrumentality of any governmental or political subdivision. "Maximum Allowable Cost" or "MAC" means the cost basis for reimbursement established by Aetna, as modified from time to time, for the same dose and form of Generic Drugs which are included on Aetna's applicable MAC List. "MAC List(s)" means the lists of MAC payment schedules for Prescription Drugs, devices and supplies identified as readily available as a Generic Drug or generally equivalent to a Brand Drug (in which case the Brand Drug may also be on the MAC List) and developed and maintained or selected by Aetna and that, in each case, are deemed to require or are otherwise capable of pricing management due to the number of drug manufacturers, utilization and/or pricing volatility. "Mail Order Exception List" means the list of Prescription Drugs established by Aetna that includes Brand Drugs adjudicating as Generic Drugs, trademark Generic Drugs, any Generic Drug that is manufactured by one (1) manufacturer (or multiple manufacturers, for example, in the case of "authorized" Generic Drugs), and any Generic Drug that has an AWP within twenty-five percent (25%) of the AWP of the equivalent Brand Drug. The Mail Order Exception List is subject to change. "National Drug Code" or "NDC" means a universal product identifier for human drugs. The National Drug Code Query (NDCQ) content is limited to Prescription Drugs and a few selected OTC products. The National RX SAS Drug Code (NDC) Number is a unique, eleven -digit, three -segment number that identifies the labeler/vendor, product, and trade package size. "On -Line Claim" means a claim that (i) meets all applicable requirements, is submitted in the proper timeframe and format, and contains all necessary information, and (ii) is submitted electronically for payment to Aetna by a Participating Pharmacy as a result of provision of Covered Services to a Plan Participant. "Participating Pharmacy" means a Participating Retail Pharmacy, Aetna Mail Order Pharmacy or Aetna Specialty Pharmacy. "Participating Retail Pharmacy" means any licensed retail pharmacy that has entered into an arrangement with Aetna to provide Covered Services to Plan Participants. "Pharmacy Audits" shall have the meaning set forth in Section VII.A.1. "Plan" shall mean the self-funded employee health benefits plan for certain eligible Plan Participants pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"). "Plan Participants" shall mean employees, dependents, beneficiaries, retirees, or members as referenced in the Plan documents, or any term used by Customer to designate participants in the Plan. "Precertification" means a process under which certain drugs require prior authorization (prior approval) before Plan Participants can obtain them as a covered benefit. The Aetna Pharmacy Management Precertification Unit must receive prior notification from physicians or their authorized agents requesting coverage for medications on the Precertification List. "Prescriber" means an individual who is appropriately licensed and permitted by law to order drugs that legally require a prescription. "Prescription Drug" means a legend drug that, by Law, cannot be sold without a written prescription from an authorized Prescriber. For purposes of this Agreement, insulin, certain supplies, and devices shall be considered a Prescription Drug. "Prospective Drug Utilization Review" or "Prospective DUR" means a review of drug utilization that is performed before a prescribed medication is covered under a Plan. "Rebates" shall mean certain monetary distributions made to Customer by Aetna under the pharmacy benefit and funded from retrospective amounts paid to Aetna (i) pursuant to the terms of an agreement with a pharmaceutical manufacturer, (ii) in consideration for the inclusion of such manufacturer's drug(s) on Aetna's Formulary, and (iii) which are directly related and attributable to, and calculated based upon, the specific and identifiable utilization of certain Prescription Drugs by Plan Participants. "Rebate Contract Excerpts", if any, shall have the meaning set forth in Section VII. "Rebate Guarantee" means the Rebate amount that Aetna guarantees Customer will receive as set forth in the Service and Fee Schedule. "Retrospective Drug Utilization Review" or "Retrospective DUR" means a review of drug utilization that is performed after a Claim for Covered Services is processed. "Service and Fee Schedule" means a document entitled same and incorporated herein by reference setting forth certain guarantees (if applicable), underlying conditions and other financial information relevant to Customer. "Services" shall have the meaning set forth in Section IV.A.1. RX SAS "Specialty Products" means those injectable and non -injectable Prescription Drugs, other medicines, agents, substances and other therapeutic products that are designated in the Service and Fee Schedule and modified by Aetna from time to time in its sole discretion as Specialty Products on account of their having particular characteristics, including one or more of the following: (a) they address complex, chronic diseases with many associated co -morbidities (e.g., cancer, rheumatoid arthritis, hemophilia, multiple sclerosis), (b) they require a greater amount of pharmaceutical oversight and clinical monitoring for side effect management and to limit waste, (c) they have limited pharmaceutical supply chain distribution as determined by the drug's manufacturer and/or (d) their relative expense. "Step -Therapy" means a type of Precertification under which certain medications will be excluded from coverage unless the Plan Participant tries one or more "prerequisite" drug(s) first, or unless a medical exception for. coverage is obtained. "Termination Notice Date", if applicable, shall have the meaning set forth in Section W. "Usual and Customary Retail Price" or "U&C Price" means the cash price less all applicable customer discounts which Participating Pharmacy usually charges customers for providing pharmaceutical services. 'Wholesale Acquisition Cost" or "WAC" means the wholesale acquisition cost of a prescription drug as listed in the Medispan weekly price updates (or any other similar publication designated by Aetna) received by Aetna. IV. Administration Services: Subject to the terms and conditions of this Statement of Available Services, the Services to be provided by Aetna, as well as certain Customer obligations in connection thereto, are described below. A. General Responsibilities and Obligations 1. Services Customer will purchase and Aetna will provide to Customer the services designated in this Statement of Available Services, if selected in the Service and Fee Schedule, and such other services Customer requests of Aetna and Aetna agrees in writing to perform, as further described herein (the "Services"). Customer acknowledges that Aetna may utilize the services of external reviewers or contractors in performing these Services. The Services to be provided by Aetna and the Service Fees may be adjusted by Aetna effective on the commencement of any Agreement Period, or at other times as indicated in the Service and Fee Schedule. 2. Customer's Responsibilities Customer shall perform the obligations set forth in the Agreement and in this Statement of Available Services, including without limitation, the Service and Fee Schedule. 3. Exclusivity During the term of this Statement of Available Services, Custotner shall use Aetna as the exclusive provider of the Benefit Plan Design, including without limitation, pharmacy claims processing, pharmacy network -management, clinical programs, formulary management and rebate management. All terms under this Statement of Available Services and on the attached Service and Fee Schedule are conditioned on Aetna's status as the exclusive provider of the Benefit Plan Design. Any failure by Customer to comply with this Section shall constitute a material breach of this Statement of Available Services and the Agreement. Without limiting Aetna's other rights or remedies, in the event Customer fails to comply with this Section, Aetna shall have the right to modify the terms and conditions of this Statement of Available Services, including without limitation, the financial terms set forth in the Service and Fee Schedule and any Performance Guarantees attached hereto. RX SAS B. Pharmacy Benefit Management Services 1. Pharmacy Claims Processing a. On -Line Claims Processing. Using Aetna's normal claim determination, payment and audit procedures and applicable cost control standards in a manner consistent with the terms of the description of Plan benefits and this Statement of Available Services, Aetna will perform claims processing services for Covered Services that are provided by a Participating Pharmacy after the Effective Date, and submitted electronically to Aetna's on-line claims processing system. On -Line Claim processing services shall include confirmation of coverage, performance of drug utilization review activities pursuant to this Statement of Available Services, determination of Covered Services, and adjudication of the On -Line Claims. Aetna or Customer, as applicable, shall have ultimate and final responsibility for all decisions with respect to coverage of an On -Line Claim and the benefits allowed under the Plan as set forth in the Agreement. b. DMR Claims Processing. If specified on the description of Plan benefits, Aetna will process DMR Claims using Aetna's normal claim determination, payment and audit procedures and applicable cost control standards in a manner consistent with the terms of the description of Plan benefits. The Plan Participant or Medicaid agency where applicable, shall be responsible for submitting DMR Claims directly to Aetna on such form(s) provided by Aetna within the timeframe specified on the description of Plan benefits. Aetna will process DMR Claims and, where appropriate, will reimburse such Plan Participant or Medicaid agency on behalf of Customer the lesser of (i) the amount invoiced and indicated on such DMR Claim; or (ii) the amount the Plan Participant is entitled to be reimbursed for such claim pursuant to the description of Plan benefits. With respect to any Plan Participant who submits a DMR Claim which is denied on behalf of Customer, Aetna will notify said Plan Participant of the denial and of said Plan Participant's right of review of the denial in accordance with ERISA. Aetna or Customer, as applicable, shall have ultimate and final responsibility for all decisions with respect to coverage of a DMR Claim and the benefits allowed under the Plan as set forth in the Agreement. c. Additional Services Related to Claims Processing. Whenever Aetna determines that benefits and related charges are payable under the Plan, Aetna will issue a payment of such benefits and related charges on behalf of Customer. Plan benefit payments and related charges of any amount payable under the Plan shall be made by check drawn by Aetna payable through the Bank or by electronic funds transfer or other reasonable transfer method. Customer, by execution of the Agreement, expressly authorizes Aetna to issue and accept such checks on behalf of Customer for the purpose of payment of Plan benefits and other related charges. Customer agrees to provide funds through its designated bank sufficient to satisfy all Plan benefits (and which also may include Service Fees and any late charges under the Agreement) and related charges upon notice from Aetna or the Bank of the amount of payments made by Aetna. Customer agrees to instruct its bank to forward an amount in. Federal funds on the day of the request equal to such liability by wire transfer or such other transfer method agreed upon between Customer and Aetna. As used herein "Plan benefits" means payments under the Plan, excluding any copayments, coinsurance or deductibles required by the Plan. Aetna reserves the right to place stop payments on all outstanding benefit checks (i.e., checks which have not been presented for payment) on the sooner of: (A) one (1) year following the date Aetna completes its runoff processing obligations; or (B) five (5) days following Customer's failure to provide requested funds or pay Service Fees due in accordance with the Termination section of the Agreement. RX SAS d. Where the Plan contains a coordination of benefits clause or antiduplication clause, Aetna will administer all Claims consistent with such provisions and any information concurrently in its possession as to duplicate or primary coverage. Aetna shall have no obligation to recover sums owed to the Plan by virtue of the Plan's rights to coordinate where the Claim was incurred prior to the Effective Date. Aetna has no obligation to bring actions based on subrogation or lien rights. 2. Pharmacy Network Management a. Participating Retail Pharmacies. Aetna shall provide Plan Participants access to Participating Retail Pharmacies. Aetna shall make available an updated listing of Participating Retail Pharmacies on its internet website and via its member services call center. Any additions or deletions to the network of Participating Retail Pharmacies shall be made in Aetna's sole discretion. Aetna shall provide notice to Customer of any deletions that have a material adverse impact on Plan Participants' access to Participating Retail Pharmacies. Aetna shall direct each Participating Retail Pharmacy to (a) verify the Plan Participant's eligibility using Aetna's on-line claims system, and (b) charge and collect the applicable Cost Share from Plan Participants for each Covered Service. Aetna will adjudicate On - Claims for Covered Services from Participating Retail Pharmacies using the negotiated rates that Aetna has in place with the applicable Participating Retail Pharmacy. i. Aetna shall require each Participating Retail Pharmacy to comply with Aetna's applicable network participation requirements. Aetna does not direct or otherwise exercise any control over the professional judgment exercised by any pharmacist dispensing prescriptions or providing pharmacy services. Participating Retail Pharmacies are independent contractors of Aetna and Aetna shall have no liability to Customer, any Plan Participant or any other person or entity for any act or omission of a Participating Retail Pharmacy or its agents, employees or representatives. ii. Aetna shall establish and maintain policies and procedures which it may revise from time to time specifying how and when a Participating Retail Pharmacy will be audited to review compliance with such pharmacy's agreement with Aetna. The audit may be conducted by Aetna's internal auditors and/or outside auditors, and may consist of a "desktop" audit of Claims submitted by the Participating Retail Pharmacy and/or a review of prescription and other records located onsite at such pharmacy. Any overpaid or erroneously paid amounts recovered by Aetna from a Participating Retail Pharmacy pursuant to an audit shall be credited to Customer net of any fees charged by Aetna in accordance with the Service and Fee Schedule or by Aetna's designated outside auditors, as applicable. Aetna shall attempt recovery of overpayments or payments made in error through offsets or demand of amounts due. In no event will Aetna be required to initiate litigation to recover any overpayments or payments made in error. iii. Aetna shall adjudicate each On -Line Claim for services rendered by a Participating Retail Pharmacy at the applicable Discount and Dispensing Fee negotiated between Aetna and Customer. For the avoidance of doubt, the Benefit Cost paid by Customer in connection with On -Line Claims for services rendered by Participating Retail Pharmacies may or may not be equal to the Discount and Dispensing Fees negotiated between Aetna and such pharmacies. b. Aetna Mail Order Pharmacy. Aetna shall provide Plan Participants with access to the Aetna Mail Order Pharmacy. Aetna shall make available information regarding how Plan Participants may access and use the Aetna Mail Order Pharmacy on its internet website and via its member services call center. The Aetna Mail Order Pharmacy shall verify the Plan Participant's eligibility using Aetna's on- line claims system, and shall charge and collect the applicable Cost Share from Plan Participants for each Covered Service. The Aetna Mail Order Pharmacy generally will require that medications and supplies be dispensed in quantities not to exceed a 90 -day supply, unless otherwise specified in the description of Plan benefits. If the prescription and applicable Law do not prohibit substitution of a Generic Drug equivalent, if any, for the prescribed drug, or if the Aetna Mail Order Pharmacy obtains consent of the Prescriber, the Aetna Mail Order Pharmacy shall require that the Generic Drug equivalent be dispensed to the Plan Participant. Certain Specialty Drugs, some acute drug RX SAS products or certain compounds cannot be ordered through the Aetna Mail Order Pharmacy. The Aetna Mail Order Pharmacy shall make refill reminder and on-line ordering services available to Plan Participants. Aetna and/or the Aetna Mail Order Pharmacy may promote the use of the Aetna Mail Order Pharmacy to Plan Participants through informational mailings, coupons or other financial incentives at Aetna's and/or the Aetna Mail Order Pharmacy's cost, unless otherwise agreed upon by Aetna and Customer. c. Aetna Specialty Pharmacy. Aetna shall provide Plan Participants with access to the Aetna Specialty Pharmacy. Aetna shall make available information regarding how Plan Participants may access and use the Aetna Specialty Pharmacy on its internet website and via its member services call center. The Aetna Specialty Pharmacy shall verify the Plan Participant's eligibility using Aetna's on-line claims system, and shall charge and collect the applicable Cost Share from Plan Participants for each Covered Service. The Aetna Specialty Pharmacy generally will require that Specialty Drug medications and supplies be dispensed in quantities not to exceed a 30 -day supply, unless otherwise specified in the description of Plan benefits. If the prescription and applicable Law do not prohibit substitution of a Generic Drug equivalent, if any, to the prescribed drug, or if the Aetna Specialty Pharmacy obtains consent of the Prescriber, the Aetna Specialty Pharmacy shall require that the Generic Drug equivalent be dispensed to the Plan Participant. The Aetna Specialty Pharmacy shall make refill reminder services available to Plan Participants. Aetna and/or the Aetna Specialty Pharmacy may promote the use of the Aetna Specialty Pharmacy to Plan Participants through informational mailings, coupons or other financial incentives at Aetna's and/or the Aetna Specialty Pharmacy's cost, unless otherwise agreed upon by Aetna and Customer. Further information regarding Specialty Product pricing and limitations is provided in the Service and Fee Schedule. 3. Clinical Programs a. Formulary Management. Aetna shall implement the Formulary and Aetna's formulary management programs, which may include cost containment initiatives and formulary education programs. Customer hereby elects to adopt the Formulary for use with the Plan. Subject to the terms and conditions set forth in this Statement of Available Services, Aetna grants Customer the right to use the Formulary during the term of this Statement of Available Services solely in connection with the Plan, and to distribute or make the Formulary available to Plan Participants. Customer acknowledges and agrees that it has sole discretion and authority to accept or reject the Formulary for the Plan. Customer further acknowledges and agrees that the Formulary is subject to change at Aetna's sole discretion as a result of a variety of factors, including without limitation, market conditions, clinical information, cost, rebates and other factors. Customer also acknowledges and agrees that the Formulary is the Confidential Information of Aetna and is subject to the requirements set forth in this Statement of Available Services and the Agreement. b. Prospective Drug Utilization Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits the Prospective DUR program, which may include Precertification and Step -Therapy programs and other Aetna standard Prospective DUR programs, with respect to On -Line Claims. Under these programs, Plan Participants must meet standard Aetna clinical criteria before coverage of the Prescription Drugs included in the program will be authorized; provided, however, that Customer authorizes Aetna to approve coverage of drugs for uses that do not meet applicable clinical criteria in the event of complications, co -morbidities and other factors that are not specifically addressed in such criteria. Aetna shall perform exception reviews and authorize coverage overrides when appropriate for such programs, and other benefit exclusions and limitations. In performing such reviews, Aetna may rely solely on diagnosis and other information concerning the Plan Participant deemed credible and supplied to Aetna by the requesting provider, applicable clinical criteria and other information relevant or necessary to perform the review. RX SAS c. Concurrent Drug Utilization Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits its standard Concurrent DUR programs with respect to On -Line Claims. Aetna's Concurrent DUR programs help Participating Pharmacies to identify potential drug interactions, duplicate drug therapy and other circumstances where prescriptions may be clinically inappropriate for Members. Aetna's Concurrent DUR programs are educational programs that are based on available clinical literature. Aetna's Concurrent DUR programs are administered using information submitted to and available in Aetna's on-line claims system, as well as On -Line Claims information submitted by the Participating Pharmacy. d. Retrospective Drug Utili>ation Review Services. Aetna shall implement and administer as specified in the description of Plan Benefits its standard Retrospective DUR programs with respect to On -Line Claims. Aetna's Retrospective DUR programs are designed to help providers and Plan Participants identify circumstances where prescription drug therapy may be clinically inappropriate or other cost- effective drug alternatives may be available. Aetna's Retrospective DUR programs are educational programs and program results may be communicated to Plan Participants, providers and plan sponsors. Aetna's Retrospective DUR programs are administered using information submitted to and available in Aetna's on-line claims system, as well as On -Line Claims information submitted by the Participating Pharmacy. e. Aetna Rx Check Program. If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Aetna Rx Check Program. Aetna Rx Check programs use a rapid Retrospective DUR approach. Claims are systematically analyzed, often within 24 hours of adjudication, for possible physician outreach based on program algorithms. The specific outreach programs are designed to promote quality, cost-effective care in accordance with accepted clinical guidelines through mailings or telephone calls to physicians and Plan Participants. Aetna Rx Check will analyze Claims on a daily basis, identify potential opportunities for quality and cost improvements, and will notify physicians or Plan Participants of those opportunities. The physician -based Aetna Rx Check programs will identify: ■ Certain medications that may duplicate each other's effect; ■ Certain drug to drug interactions; • Multiple prescriptions and/or Prescribers for certain medications with the potential for misuse; ■ Prescriptions for a multiple daily dose of a targeted Prescription Drug when symptoms might be controlled with a once -daily dosing; and • Plan Participants who have filled prescriptions for brand-new medications that have an A -rated generic equivalent available that could save members money. Another Aetna Rx Check program will notify Plan Participants in selected plans with mail-order drug benefits when they can save money by filling maintenance prescriptions at Aetna Rx Home Delivery versus filling prescriptions at a Participating Retail Pharmacy. f. Save-A-Copaysni: If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Save-A-Copay program. Aetna's Save-A-Copay program is designed to encourage Plan Participants to use Generic Drugs, where appropriate and with the approval of their physician. If Plan Participants switch to a generic alternative from a brand-name product, the Plan Participant Cost Share is reduced for a six month period. In such circumstances, the Customer incurs an additional cost for such Claim equal to the amount the Cost Share is reduced. RX SAS g. Disease Management Educational Program. If purchased by Customer as indicated on the Service and Fee Schedule, Aetna shall administer the Disease Management Educational Program. The Disease Management Educational Program is available to Customers who purchase Aetna managed prescription drug benefit management services, but not Aetna medical benefit plan services. The program consists of Plan Participant identification and outreach based on active Claims analysis for targeted risk conditions, such as asthma and diabetes. Upon identification, Plan Participants will receive a welcome kit introducing the program, complete with important information including educational materials and resources. Customer may choose either the Asthma or Diabetes program or a combination of the two programs. h. Disclaimer Regarding Clinical Programs. Aetna's clinical programs do not dictate or control providers' decisions regarding the treatment of care of Plan Participants. Aetna assumes no liability from Customer or any other person in connection with these programs, including the failure of a program to identify or prevent the use of drugs that result in injury to a Plan Participant. 4. Plan Participant Services and Programs Internet services including Aetna Navigator and Aetna Pharmacy Website. Through Aetna Navigator, Plan Participants have access to the following: • Estimating the cost of Prescription Drugs. • Prescription Comparison Tool — Compares the estimated cost of filling prescriptions at a Participating Retail Pharmacy to Aetna's Rx Ilome Delivery mail-order prescription service. • Preferred Drug List — Available for Plan Participants who wish to review prescribed medications to verify if any additional coverage requirements apply. • View drug alternatives for medications not on the Preferred Drug List. • Claim information and EOBs. Through the Aetna Pharmacy website, Plan Participants have access to the following: • Find -A -Pharmacy — This service helps locate an Aetna participating chain or independent pharmacy on hundreds of medications and herbal remedies. ■ Tips on drug safety and prevention of drug interactions. ■ Answers to commonly asked questions about prescription drug benefits and access to educational videos. ■ Preferred Drug List and Generic Substitution List. ■ Step Therapy List. 5. Rebate Administration a. Customer acknowledges that Aetna contracts for its own account with pharmaceutical manufacturers to obtain Rebates attributable to the utili7ation of certain prescription products by Plan Participants who receive benefits from Customers for whom Aetna provides pharmacy benefit management services. Subject to the terms and conditions set forth in this Statement of Available Services, including without limitation, Aetna may pay to Customer Rebates based on the utili7ation by Plan Participants of rebateable Prescription Drugs administered and paid through the Plan Participant's pharmacy benefits. RX SAS b. If Customer is eligible to receive Rebates under this Statement of Available Services, Customer acknowledges and agrees that Aetna shall retain the interest (if any) on, or the time value of, any Rebates received by Aetna prior to Aetna's payment of such Rebates to Customer in accordance with this Statement of Available Services. Aetna may delay payment of Rebates to Customer to allow for final adjustments or reconciliation of Service Fees or other amounts owed by Customer upon termination of this Statement of Available Services. c. If Customer is eligible to receive a portion of Rebates under this Statement of Available Services, Customer acknowledges and agrees that such eligibility under paragraphs a. and b. above shall be subject to Customer's and its affiliates', representatives' and agents' compliance with the terms of this Statement of Available Services, including without limitation, the following requirements: i. Election of, and compliance with, Aetna's Formulary; ii. Adoption of and conformance to certain benefit plan design requirements related to the Formulary as described in Service and Fee Schedule; iii. Distribution of the Formulary (or a summary thereof) to Plan Participants and/or physicians, as applicable; and iv. Compliance with other generally applicable requirements for participation in Aetna's rebate program, as communicated by Aetna to Customer from time to time. Customer further acknowledges and agrees that if it is eligible to receive a portion of Rebates under this Statement of Available Services, such eligibility shall be subject to the condition that Customer, its affiliates, representatives and agents do not contract directly or indirectly with any other person or entity for discounts, utilization limits, Rebates or other financial incentives on pharmaceutical products or formulary programs for Claims processed by Aetna pursuant to this Agreement, without the prior written consent of Aetna. Without limiting Aetna's right to other remedies, failure by Customer to obtain Aetna's prior written consent in accordance with the immediately preceding sentence shall constitute a material breach of the Agreement, entitling Aetna to (a) suspend payment of Rebates hereunder and to renegotiate the terms and conditions of this Agreement, and/or (b) immediately withhold any Rebates earned by, but not yet paid to, Customer as necessary to prevent duplicative Rebates on such drugs. C. General Administration Services 1. Eligibility Transmission The Service Fees set forth under the Service and Fee Schedule assume that Customer will provide eligibility information monthly, or more frequently, from one (1) location by electronic connectivity. Submission of eligibility information by more than one location or via multiple methods will result in additional charges to Customer as determined by Aetna. Costs associated with any custom programming necessary to accept eligibility information from Customer are excluded from the Service Fees set forth in the Service and Fee Schedule. Customer has the sole and complete authority to determine eligibility of persons to participate in the Plan. 2. Customer Services a. Aetna will assign an Account Executive to Customer's account. The Account Executive will be available to assist Customer in connection with the general administration of the Services, ongoing communications with Customer and assistance in claims administration and record-keeping systems for Customer's ongoing operation of the Plan. RX SAS b. Upon request by Customer and consent by Aetna, Aetna will implement changes in Claims administration consistent with Customer's modifications of its Plan. A charge may be assessed for implementing such changes. Customer's Services Fees, as set forth in the Service and Fee Schedule, will be revised if the foregoing amendments or modifications increase Aetna's costs. c. Aetna will provide the following reports to Customer for no additional charge: i. Monthly/Quarterly/Annual Accounting Reports - Aetna shall prepare the following accounting reports in accordance with the benefit -account structure for use by Customer in the financial management and administrative control of the Plan benefits: ■ a monthly listing of funds requested and received for payment of Plan benefits; ■ a monthly reconciliation of funds requested to Claims paid within the benefit -account structure; ■ a monthly or quarterly or annual listing of paid benefits; and ■ quarterly or annual standard claim analysis reports. ii. Annual Accounting Reports - Aetna shall prepare standard annual accounting reports for each major benefit line under the Plan for the Agreement Period that include the following: ■ forecast of Claim costs; ■ accounting of experience; and ■ calculation of Customer reserve. Any additional reporting formats and the price for any such reports shall be mutually agreed upon by Customer and Aetna. d. Customer shall adopt Aetna's administrative and record keeping systems, including the production of Plan Participant identification cards. e. Aetna shall design and install a benefit -account structure separately by class of employees, division, subsidiary, associated company, or other classification reasonably desired by Customer. f. Aetna shall provide plan design and underwriting services in connection with benefit revisions, additions of new benefits and extensions of coverage to new Plan Participants. Aetna shall provide cost estimates and actuarial advice for benefit revisions, new benefits and extensions of coverage being considered by Customer. h. Upon request of Customer, Aetna will provide Customer with information reasonably available to Aetna which is reasonably necessary for Customer to prepare reports for the United States Internal Revenue Service and Department of Labor. g• i. Upon request, Aetna shall provide the following Plan description services: (i). RX SAS Upon request of Customer, Aetna shall prepare an Aetna standard Plan description, including benefit revisions, additions of new benefits, and extension of coverage under the Plan. If the Customer elects to have an Aetna non-standard Plan description, Aetna will provide a custom Plan description with all costs borne by Customer; or Upon request of Customer, Aetna will review Customer -prepared employee Plan descriptions, subject to the Customer's final and sole authority regarding benefits and provisions in the self- insured portion of the Plan. Customer acknowledges its responsibility to review and approve all Plan descriptions and any revisions thereto and to consult Customer's legal counsel, at its discretion, with said review and approval. Aetna shall have no responsibility or liability for the content of any of Customer's Plan documents, regardless of the role Aetna may have played in the preparation of such documents. If Customer requires both preparation (a) and review (b), there may be an additional charge. j. Upon request by Customer, Aetna will arrange for the printing of Plan descriptions, with all costs borne by Customer. k. Upon request by Customer, Aetna will arrange for the custom printing of forms and identification cards, with all costs borne by Customer. V. Important Information about the Pharmacy Benefit Management Services A. Customer acknowledges that Aetna contracts for its own account with pharmaceutical manufacturers to obtain Prescription Drug Formulary Rebates directly attributable to the utili7ation of certain Prescription Drugs by Plan Participants who receive Covered Services. The Rebate amounts negotiated by Aetna with pharmaceutical manufacturers vary based on several factors, including the volume of utilization, benefit plan design, and Formulary or preferred coverage terms. Aetna may offer Customer an amount of Rebates on Prescription Drugs that are administered and paid through the Plan Participant's pharmacy benefit. These Rebates are earned when members use drugs listed on Aetna's Formulary and preferred Specialty Products. Aetna determines each customer's Rebates based on actual Plan Participant utili7ation of those Formulary and preferred Specialty Products for which Aetna also has manufacturer Rebate contracts. The amount of Rebates will be determined in accordance with the terms set forth in Customer's Pharmacy Service and Fee Schedule. Rebates for Specialty Products that are administered and paid through the Plan Participant's medical benefit rather than the Plan Participant's pharmacy benefit will be retained by Aetna as compensation for Aetna's efforts in administering the preferred Specialty Products program Pharmaceutical rebates earned on Prescription Drugs and Specialty Products administered and paid through the Plan Participant's pharmacy benefits represent the great majority of Rebates. A report indicating the Plan's Rebate payments, broken down by calendar quarter, is included with each remittance received under the program, and is also available upon request. Remittances are distributed as outlined in the Pharmacy Service and Fee Schedule. Interest (if any) received by Aetna prior to allocation to eligible self-funded customers is retained by Aetna. Any material plan changes impacting administration, utilization or demographics may impact Rebate projections and actual Rebates received. Aetna reserves the right to terminate or change this program prior to the end of any Agreement Period for which it is offered if: (a) there is any legal, legislative or regulatory action that materially affects or could affect the manner in which Aetna conducts its Rebate program; (b) any material manufacturer Rebate contracts with Aetna are terminated or modified in whole or in part; or (c) the Rebates actually received under any material manufacturer Rebate contract are less than the level of Rebates assumed by Aetna for the applicable Agreement Period. If there is any legal action, law or regulation that prohibits, or could prohibit, the continuance of the Rebate program, or an existing law is interpreted to prohibit the program, the program shall terminate automatically as to the state or jurisdiction of such law or regulation on the effective date of such law, regulation or interpretation. RX SAS B. Customer acknowledges that from time to time, Aetna receives other payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates and which axe paid separately to Aetna or designated third parties (e.g., mailing vendors, printers). These payments are to reimburse Aetna for the cost of various educational programs. These programs are designed to reinforce Aetna's goals of maintaining access to quality, affordable health care for Plan Participants and Customer. These goals are typically accomplished by educating physicians and Plan Participants about established clinical guidelines, disease management, appropriate and cost-effective therapies, and other information. Aetna may also receive payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates as compensation for bona fide services it performs, such as the analysis or provision of aggregated information regarding utilization of health care services and the administration of therapy or disease management programs. These other payments are unrelated to the Prescription Drug Formulary Rebate arrangements, and serve educational as well as other functions. Consequently, these payments are not considered Rebates, and are not included in the Rebates provided to Customer, if any. C. Customer acknowledges that in evaluating clinically and therapeutically similar Prescription Drugs for selection for the Formulary, Aetna reviews the costs of Prescription Drugs and takes into account Rebates negotiated between Aetna and Prescription Drug manufacturers. Consequently, a Prescription Drug may be included on the Formulary that is more expensive than a non -Formulary alternative before any Rebates Aetna may receive from a Prescription Drug manufacturer are taken into account. In addition, certain Prescription Drugs may be chosen for Formulary status because of their clinical or therapeutic advantages or level of acceptance among physicians even though they cost more than non -Formulary alternatives. The net cost to Customer for Covered Services will vary based on: (i) the terms of Aetna's arrangements with Participating Pharmacies; (ii) the amount of the Cost Share obligation under the terms of the Plan; and (iii) the amount, if any, of Rebates to which Customer is entitled under this Statement of Available Services and Service and Fee Schedule. As a result, Customer's actual claim expense per prescription fora particular Formulary Prescription Drug may in some circumstances be higher than for a non -Formulary alternative. In Plans with Cost Share tiers, use of Formulary Prescription Drugs generally will result in lower costs to Plan Participants. However, where the Plan utilizes a Cost Share calculated on a percentage basis, there could be some circumstances in which a Formulary Prescription Drug would cost the Plan Participant more than a non -Formulary Prescription Drug because: (i) the negotiated Participating Pharmacy payment rate for the Formulary Prescription Drug may be more than the negotiated Participating Pharmacy payment rate for the non -Formulary Prescription Drug; and (ii) Rebates received by Aetna from Prescription Drug manufacturers are not reflected in the cost of a Prescription Drug obtained by a Plan Participant. D. Customer acknowledges that Aetna contracts with Participating Retail Pharmacies directly or through a pharmacy benefit management ("PBM") subcontract to provide Customer and Plan Participants with access to Covered Services. The prices negotiated and paid by Aetna or PBM to Participating Retail Pharmacies vary among Participating Retail Pharmacies in Aetna's network, and can vary from one pharmacy product, plan or network to another. Under this Statement of Available Service and Service and Fee Schedule, Customer and Aetna have negotiated and agreed upon a uniform or "lock -in" price to be paid by Customer for all claims for Covered Services dispensed by Participating Retail Pharmacies. This uniform price may exceed or be less than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services. Where the uniform price exceeds the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realizes a positive margin. In cases where the uniform price is lower than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realires a negative margin. Overall, lock -in pricing arrangements result in a positive margin for Aetna. Such margin is retained by Aetna in addition to any other fees, charges or other amounts agreed upon by Aetna and Customer, as compensation for the pharmacy benefit management services Aetna provides to Customer. Also, when Aetna receives payment from Customer before payment to a Participating Pharmacy or PBM, Aetna retains the benefit of the use of the funds between these payments. RX SAS E. Customer acknowledges that Covered Services under a Plan may be provided by Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy. In such circumstances, Aetna Mail Order Pharmacy refers to Aetna Rx Home Delivery, LLC, and Aetna Specialty Pharmacy refers to Aetna Specialty Pharmacy, LLC, both of which are subsidiaries of Aetna that are licensed Participating Pharmacies. Aetna's negotiated reimbursement rates with Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy, which are the rates made available to Customer, generally are higher than the pharmacies' cost of fulfilling orders of Prescription Drugs and Specialty Products and providing Covered Services and therefore these pharmacies realize an overall positive margin for the Covered Services they provide. To the extent Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy purchase Prescription Drugs and Specialty Products for their own account, the cost therefor takes into account both up -front and retrospective purchase discounts, credits and other amounts that they may receive from wholesalers, manufacturers, suppliers and distributors. Such purchase discounts, credits and other amounts are negotiated by Aetna Mail Order Pharmacy, Aetna Specialty Pharmacy or their affiliates for their own account and are not considered Rebates paid to Aetna by manufacturers in connection with Aetna's Rebate program. F. Customer acknowledges that Aetna generally pays Participating Pharmacies (either directly or through PBM) for Brand Drugs whose patents have expired and their Generic Drug equivalents at a single, fixed price established by Aetna (Maximum Allowable Cost or MAC). MAC pricing is designed to help promote appropriate, cost-effective dispensing by encouraging Participating Pharmacies to dispense equivalent Generic Drugs where clinically appropriate. When a Brand Drug patent expires and one or more generic alternatives first become available, the price for the Generic Drug(s) may not be significantly less than the price for the Brand Drug. Aetna reviews the drugs to determine whether to pay Participating Pharmacies (or PBM) based on MAC or continue to pay Participating Pharmacies (or PBM) on a discounted fee-for-service basis, typically a percentage discount off of the listed Average Wholesale Price of the drug (AWP Discount). This determination is based in part on a comparison under both the MAC and AWP Discount methodologies of the relative pricing of the Brand and Generic Drugs, taking into account any Rebates Aetna may receive from Prescription Drug manufacturers in connection with the Brand Drug. If Aetna determines that under AWP Discount pricing the Brand Drug is less expensive (after taking into account manufacturer Rebates Aetna receives) than the generic alternative(s), Aetna may elect not to establish a MAC price for such Prescription Drugs and continue to pay Participating Pharmacies (or PBM) according to an AWP Discount. In some circumstances, a decision not to establish a MAC price for a Brand Drug and its generic equivalents dispensed by Participating Pharmacies could mean that the cost of such Prescription Drugs for Customer is not reduced. In addition, there may be some circumstances where Customer could incur higher costs for a specific Generic Drug ordered through Aetna Mail Order Pharmacy than if such Generic Drug were dispensed by a Participating Retail Pharmacy. These situations may result from: (i) the terms of Aetna's arrangements with Participating Pharmacies (or PBM); (ii) the amount of the Cost Share; (iii) reduced retail prices and/or discounts offered by Participating Pharmacies to patients; and (iv) the amount, if any, of Rebates to which Customer is entitled under the Statement of Available Services and the Service and Fee Schedule. Claims for certain Generic Drugs ordered through Aetna Mail Order Delivery that cannot be purchased from manufacturers, wholesalers and other suppliers at reduced prices typical of multi -source generic drugs are paid by Aetna at the negotiated prices applicable to Brand Drugs ordered through Aetna Mail Order Pharmacy. Examples of these Generic Drugs include Brand Drugs that are incorrectly coded as generic by the drug pricing publication used by Aetna, trademarked Generic Drugs, any Generic Drug that is manufactured by one (1) manufacturer (or multiple manufacturers in the case of "authorized" Generic Drugs), and any Generic Drug that has an AWP price within twenty-five percent (25%) of the equivalent Brand Drug. Aetna excludes Aetna Mail Order Pharmacy claims for such Generic Drugs from the reconciliation of its standard pharmacy Discount and Dispensing Fee financial guarantees. RX SAS VI. Early Termination Consequences of Early Termination Without limiting Aetna's other rights or remedies, the following shall apply in the event this Statement of Available Services is terminated (i) by Customer without cause or (ii) by Aetna with cause pursuant to the Agreement: Customer acknowledges and agrees that Aetna shall retail any Rebates earned by, but not yet paid to, Customer as of the effective date of the termination of the Statement of Available Services. VII. Audit Rights A. General Pharmacy Audit Terms and Conditions 1. Subject to the terms and conditions set forth in the Agreement and disclosures made in the Service and Fee Schedule, Customer shall be entitled to have audits performed on its behalf (hereinafter "Pharmacy Audits") to verify that Aetna has (a) processed Claims submitted by participating pharmacies or a pharmacy benefits manager under contract with Aetna, (b) paid Rebates in accordance with this Statement of Available Services and the Service and Fee Schedule. Pharmacy Audits may be performed at Aetna's Minnetonka, IVIN or I-lartford, CT location. For purposes of this Section VII, the term "Aetna" as defined in Section III shall not include subcontractor. 2. Additional Terms and Conditions In addition to the audit terms and conditions set forth in the Agreement and the Service and Fee Schedule, the following general terms and conditions shall apply with respect to Pharmacy Audits. a. Auditor Qualifications and Requirements specific to Pharmacy Audits All Pharmacy Audits shall be performed solely by third party auditors meeting the qualifications and requirements of the Agreement, this Statement of Available Services and the Service and Fee Schedule. Customer will ensure that third party auditors conduct Pharmacy Audits on its behalf in accordance with published administrative safeguards or procedures that shall prevent the unauthorized use or disclosure to Customer or any other third party (in the Pharmacy Audit report or otherwise) of any individually identifiable information (including health care information) or financial information contained in the information to be audited. Customer and such individuals will not make or retain any record of provider negotiated rates or financial information included in the audited transactions, or payment identifying information concerning treatment of drug or alcohol abuse, mental/nervous or HIV/AIDS or genetic markers, in connection with any Pharmacy Audit. There must be no conflict of interest or past business or other relationship which would prevent the auditor from performing an independent audit to conclusion. A conflict of interest includes, but is not limited to, a situation in which the audit agent (i) is employed by an entity, or any affiliate of such entity, which is a competitor to Aetna's benefits or claims administration business or Aetna Mail Order Pharmacy or Aetna Specialty Pharmacy; (ii) has terminated from Aetna within the past 12 months; (iii) is affiliated with a vendor subcontracted by Aetna to adjudicate claims or provide services in connection with Aetna's administration of benefits or provision of mail order or specialty pharmacy services; or (iv) is compensated in a manner which could financially incent the agent to overstate or misconstrue data. Determination of the nature of a conflict of interest shall be at the discretion of Aetna and, in any event, shall be communicated to Customer within ten (10) business days of notice of intent to audit. The auditor chosen by Customer must be mutually agreeable to both Customer and Aetna. Auditors may not be compensated on the basis of a contingency fee or a percentage of overpayments identified, in accordance with the provisions of Section 8.207 through 8.209 of the International Federation of Accountant's (IFAC) Code of Ethics For Professional Accountants (Revised 2004). Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any Audit hereunder. RX SAS b. Auditor Qualifications and Requirements specific to Rebate Audits Aetna's agreements with pharmaceutical manufacturers are subject to confidentiality agreements. Any audit of Aetna's agreements with pharmaceutical manufacturers will be conducted by (a) one of the major public accounting firms (currently the "Big 4") approved by Aetna whose audit department is a separate stand alone function of its business, or (b) a national CPA firm approved by Aetna whose audit department is a separate stand alone function of its business. Pharmacy Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any Audit hereunder. c. Closing Meeting In the event that Aetna and Customer's auditors are unable to resolve any such disagreement regarding draft Pharmacy Audit findings, either Aetna or Customer shall have the right to refer such dispute to an independent third -party auditor meeting the requirements of the Agreement, this Section VII and the Service and Fee Schedule and selected by mutual agreement of Aetna and Customer. The parties shall bear equally the fees and charges of any such independent third -party auditor, provided however that if such auditor determines that Aetna or Customer's auditor is correct, the non -prevailing party shall bear all fees and charges of such auditor. The determination by any such independent third -party auditor shall be final and binding upon the parties, absent manifest error, and shall be reflected in the final Pharmacy Audit report. B. Additional Claim and Rebate Audit Terms and Conditions 1. Rebate Audits Subject to the terms and limitations of this Statement of Available Services, the Agreement, and the Service and Fee Schedule including without limitation the general Pharmacy Audit terms and conditions set forth in this Section VII, Customer shall be entitled to audit Aetna's calculation of up to 15% of the Rebates received by Customer which are attributable to the drugs most highly utilized by Plan Participants. Aetna will share the relevant portions of the applicable formulary rebate contracts, including the manufacturer names, drug names and rebate percentages for the drugs being audited. The drugs to be audited will be selected by mutual agreement of the parties. The parties will reasonably cooperate to select drugs for each audit that (a) represent the fewest unique manufacturer rebate contracts required for audit so that the selected drugs represent a maximum of 15% of Customer's Rebates; and (b) are subject to manufacturer rebate agreements that do not contain restrictions prohibiting Aetna from disclosing to Customer portions of such contracts concerning the rebates, payments or fees payable there under (hereinafter the "Rebate Contract Excerpts"). Aetna will also provide access to all documents reasonably necessary to verify that Rebates have been invoiced, calculated, and paid by Aetna in accordance with this Statement of Available Services. Prior to the commencement of a Rebate verification audit, Aetna will provide to Customer a report identifying the drugs to be included in such audit. Customer is entitled to only one annual Rebate audit. 2. Pharmacy Claim Audits. Claim audits are subject to the above referenced audit standards for Rebates in the case of a physical, on-site, Claim -based audit. In the case of electronic Claim audits that follow standard pharmacy benefit audit practices where electronic re -adjudication of Claims is requested and processed off-site, Customer may elect to audit 100% of claims. Customer is entitled to only one annual Claim audit. RX SAS VIII. Fees Administrative Fees are provided in conjunction with Aetna's Services relating to the Benefit Plan Design and summarized in the Service and Fee Schedule. IX. Financial Guarantees In conjunction with the Services provided by Aetna under this Statement of Available Services, Aetna shall provide any financial guarantees set forth in the Service and Fee Schedule. X. Performance Guarantees Any Performance Guarantees applicable to this Statement of Available Services are attached in the Performance Guarantee Appendix as referenced in the Agreement. RX SAS Benefit Plan Brand Drugs Generic Drugs Administrative Fee Rebates Effective Date 01/01/2014 Benefit Plan 3 -Tier CO Guaranteed AWP Discount Guaranteed Dispensing Fee / Rx Guaranteed(2) AWP Discount Guaranteed Dispensing Fee / Rx Year 1: AWP —15.10% Year 2: AWP — 15.20% Year 3: AWP — 15.30% Year 1: $1.50 Year 2: $1.50 Year 3: $1.50 Year 1: AWP — 68.00% (overall, includes MAC and non - MAC Year 2: AWP — 68.20% (overall, includes MAC and non - MAC Year 3: AWP — 68.40% (overall, includes MAC and non - MAC Year 1: $1.50 Year 2: $1.50 Year 3: $1.50 Year 1: AWP — 22.60% Year 2: AWP — 22.70% Year 3: AWP — 22.80% Year 1: $0.00 Year 2: $0.00 Year 3: $0.00 Year 1: AWP — 70.00% Year 2: AWP — 70.20% Year 3: AWP — 70.40% Year 1: $0.00 Year 2: $0.00 Year 3: $0.00 2 Retail and Mail discount includes all ; enerics sin • le -source and multi -source The following administrative fee will ap .ly: Plan sponsor will receive the following minimum rebate guarantees: Year 1: $0.00 PEPIVI Year 2: $0.00 PEPM Year 3: $0.00 PEPM Year 1: Greater of 50.00% or $14.61 Per Brand Scri. t Year 2: Greater of 50.00% or $14.96 Per Brand Scri. t Year 3: Greater of 50.00% or $15.40 Per Brand Scri. t Year 1: Greater of 50.00% or $49.01 Per Brand Scri. t Year 2: Greater of 50.00% or $49.83 Per Brand Scri.t Year 3: Greater of 50.00% or $47.36 Per Brand Scrip t (1) To qualify for 3 -tier rebates, the members in this plan must be covered by a plan design which contains at least three tiers, where the first tier consists of generic drugs, the second tier consists of preferred brand drugs, and the third tier consists of non -preferred brand drugs, with a minimum $15.00 retail/$30.00 mail order copay differential between the second and third tier, or in the case of co-insurance plans a minimum 1.5 times difference in the co- insurance percentage between the second and third tier (for example, if the second tier co-insurance is 20%, the third tier co-insurance must be at least 30%); for plans that have co-insurance with minimums, there must be a minimum $15.00 retail/$30.00 mail order copay differential between the second and third tier regardless of the co- insurance percentage; if there are copay maximums, the minimum copay on the third tier must be greater than the maximum copay on the second tier. Aetna will adjudicate Claims through our retail pharmacy network at the lowest of U&C, MAC, or discounted AWP. Words beginning with capital letters shall have the meaning set forth in Section II of the Statement of Available Services. Any reference to "Member" shall mean a Plan Participant as defined in the Statement of Available Services. RX SFS Pricing Updates & New To Market Products When new Specialty Products gain FDA approval, Aetna Pharmacy Management notifies Customer on a monthly basis of the availability and projected pricing of these Specialty Products. However, whether such Specialty Products will be included as Covered Services will depend on the Customer's Plan design. Aetna Pharmacy Management also notifies Customer on a monthly basis of limited distribution Specialty Products newly available through Aetna Specialty Pharmacy. Aetna Specialty Pharmacy determines the pricing for new to market Specialty Products by considering various factors, such as acquisition cost, expected dosages, package sizes and utilization. In any case, such Specialty Products will have a minimum market introduction guarantee of AWP less 10%. Producer Compensation Aetna may pay a varying producer compensation to Customer's benefit consultant for services provided to Aetna or Customer and Customer acknowledges and consents to Aetna paying such producer compensation. Information regarding the producer compensation is available through the Customer's benefit consultant or Aetna. Assumptions The Service Fees and Services set forth herein are based on, among other things, the assumption that a total of 767 of Customer's employees will be receiving Covered Services through Aetna. If there is a change of greater than 15% of this enrollment or in the geographic, demographic or eligible mix of the population, Aetna reserves the right to revisit the structure and/or conditions of this Service and Fee Schedule. For the purposes of Discounts, the savings percentage will be calculated by dividing the AWP less the ingredient cost for the drugs dispensed by the AWP for such drugs. For each eligible prescription -drug claim, Calculated Ingredient Cost will be calculated at the lesser of the applicable MAC, or AWP Discount price in determining the Discount achieved for purposes of calculating Discounts, including 100% Plan Participant Cost Share Claims at the applicable calculated Discount prior to the application of the Plan Participant Cost Share. Cost Share will be calculated on the basis of the rates charged to Customer by Aetna for Covered Services except as required by law to be otherwise. The Generic Drug Discount includes Multi -Source Brand Products that are subject to MAC pricing. Discount and Dispensing Fee guarantees shall not apply to Compound drug claims, claims that process at U&C, direct member reimbursement (DMR) claims, and claims for products dispensed by Aetna Specialty Pharmacy. Aetna reserves the right to exclude claims for over-the-counter products, supplies, vaccines, workers compensation claims, and in-house pharmacy or 340b claims from the discount and dispensing fee guarantees. Rebates will be distributed on a Quarterly basis. Rebate allocations will be made within 180 days from the end of such allocation period. Rebates are not available for Claims arising from Participating Pharmacies dispensing Prescription Drugs subject to either their (i) own manufacturer rebate contracts or (ii) participation in the 340B Drug Pricing Program codified as Section 340B of the Public Health Service Act or other Federal government pharmaceutical purchasing program. Customer shall adopt the Aetna Formulary in order to be eligible to receive Rebates as provided in the Service and Fee Schedule as set forth herein unless otherwise agree upon by Customer and Aetna. Rebates are paid on Specialty Products dispensed through Participating Pharmacies and covered under the Plan. Rebate, Discount and Dispensing Fee Guarantees are based on the Plan in effect and as disclosed to Aetna during any Agreement Period. Accordingly, if Customer fails to disclose to Aetna that it employs, or intends to employ, a consumer driven health plan, major cost sharing changes, any utilisation management program promoting Generic or OTC Drugs over Brand Drugs during any Agreement Period, Aetna reserves the right to adjust Guarantees. Retail and Mail Order rebate guarantee components are measured individually and reconciled in aggregate on an annual basis. Retail brand, retail generic, mail order brand and mail order generic discount guarantee components are measured individually and reconciled in aggregate on an annual basis. RX SFS Retail brand, retail generic, mail order brand and mail order generic dispensing fee guarantee components are measured individually and reconciled in aggregate on an annual basis. PPACA — Aetna reserves the right to modify its products, services, and fees, and to recoup any costs, taxes, fees, or assessments, in response to legislation, regulation or requests of government authorities. Any taxes or fees (assessments) applied to self-funded benefit plans related to The Patient Protection and Affordable Care Act (PPACA) will be solely the obligation of the plan sponsor. The pharmacy pricing that Aetna is presenting does not include any such plan sponsor liability. Aetna reserves the right to make appropriate changes to these guarantees if (a) there are any significant changes in the composition of Aetna's pharmacy network or in Aetna's pharmacy network contract compensation rates, or the structure of the pharmacy stores/chains/vendors that are contracted with Aetna, including but not limited to disruption in the retail pharmacy delivery model, and bankruptcy of a chain pharmacy, or (b) there is a change in government laws or regulations which have a significant impact on pharmacy claim costs, or (c) any material manufacturer rebate contracts with Aetna are terminated or modified in whole or in part, or (d) here is any legalaction or Law that materially affects or could materially affect the manner in which Aetna administers the rebate program, or if an existing Law is interpreted so as to materially affect or potentially have a material affect on Aetna's administration of the program, or (e) there is a material change in the Plan that is initiated by the Customer which impacts Aetna's costs. Customer and Aetna agree that AWP, the underlying financial basis of the Statement of Available Services and this Service and Fee Schedule, may become modified or discontinued by means outside of the control of Customer and Aetna, thereby impairing the financial intent of the parties hereunder. In the event of such modification or discontinuance, the parties agree that Aetna, in order to preserve such financial intent, may opt to (i) change the AWP source from MediSpan to another AWP source, (ii) maintain the AWP as modified but make appropriate adjustments with Customer and/or Participating Pharmacies, or (iii) change the pricing index from AWP to another industry standard index, such as Wholesale Acquisition Cost. Aetna shall provide Customer with at least ninety (90) days written notice of the option taken by Aetna together with a sufficiently detailed explanation demonstrating how such option has preserved the parties' financial intent. If ninety (90) days notice is not practicable under the circumstances, Aetna shall provide notice as soon as practicable. If Customer disputes this explanation, the parties agree to cooperate in good faith to resolve such dispute. If (a) City Of Round Rock terminates the Agreement prior to the date the pharmacy rebate check is issued, or (b) the Agreement is terminated by Aetna for City Of Round Rock's failure to meet its obligations to fund benefits or pay administrative fees (medical or pharmacy) under the Agreement, Aetna will be entitled to deduct deferred administrative fees or other plan expenses due to the termination date from any rebate check due City Of Round Rock following the termination date. If the Aetna Pharmacy Management (APM) plan is terminated by City Of Round Rock prior to December 31, 2016, Aetna will retain any rebates earned but not issued as of the APM cancellation date. To the extent this Service and Fee Schedule is part of a proposal to Customer, the Service Fees and Services set forth herein are valid for 90 days from the date of such proposal. All guarantees and underlying conditions are subject and limited to Prescription Drugs dispensed by Participating Pharmacies. RX SFS Programs & Services Aetna offers a comprehensive suite of trend and integrated health management programs and services. Below is a list, by product, of those services and programs that are available to City Of Round Rock. This offering may change or be discontinued from time to time as we update our offering to meet the needs of the marketplace. Please note the following. • Services and programs included in our quoted pricing are indicated as "Included" ■ Services and programs that are optional are noted as such and those that require an additional fee are indicated as "Optional Enhancement" Pharmacy Programs and Services Categories Included / Optional GeneralsAdm nist�ration � z Implementation Services Included Account Management Included Customer Team Services Included Banking Included Standard Communication Materials Included ID Cards Included Eligibility Included Standard Reporting Included e ork drat stratidn Pharmacy Network Management . Included .. Clarnu&M e e Services _... .tit';, _;:, Claim Administration Included Member Services Included Aetna Rx Home Delivery Included he t ,aria em' n , t .„.. `..� re. bK k`:. �M` s _IZ. F F '�,. ..'�'_ ,. ..... .,'.5�?Yr'i3s. ..'+�4 Formulary Management (Aetna Formulary) Included Custom Formulary Management - rebates are subject to change upon review $1.00 PEPM if selected aternet-S'ertnc _ � '... ... : Aetna Navigator _ Included Public Site Included Secure Site (log in). Included Find -A -Pharmacy Included InteliHealth Included Concurrent Drug Urili7ation Review (DUR) Included Point of Care Edits Included Safety Edits Included Expanded Age Edits Included (upon customer request) Expanded Gender Edits Included (upon customer request) Enhanced Safe ' Edits Included (upon customer request) p i0ffi-4, 9ry8 . Aro-r-#h. u �.{�� ' •'Wt* §K'' `-” . '2`"f`Y° ` � 9_:,? ,,, ; Nr i "L:�._ Controlled Substance Use Program Included Blood Glucose Monitor Included Prescription Savings Program Included ExtraCare ® Health Card Included (upon customer request) Heart Care for Life Included (upon customer request) Migraine Management Included (upon customer request) RX SFS Categories Included / Optional Brand to Generic Outreach Included Generic Sampling Included Brand to Generic Included Generic Launch Included Aetna Rx Ste. Included upon customer re uest) Specialty Utilization Management including National Precertification Included Aetna Specialty Health Caresm Management Included Retail to Specialty Outreach Included Aetna Specialty CareRx: (Choice of Open Network or Preferred Network) (Please refer to Aetna Specialty Pricing Addendum for Aetna Specialty Pharmacy Discounts and Dis ensing Fees) Aetna Rx Courtesy Start -sin Included (upon customer request) Included Aetna Rx AutoFill Adherence to Drug Therapy Aetna Pharmacy Advisor* Aetna Pharmacy Advisor Diabetes Buy -Up Option* Included (upon customer request) Included (upon customer request) Included (upon customer request) $0.13 Per Member Per Month Aetna Pharmacy Advisor Diabetes and Cardiovascular Buy -Up Option* $0.26 Per Member Per Month Aetna Pharmacy Advisor All Conditions Complete Buy -Up Option* $0.38 Per Member Per Month Gaps in Care Preventative and Chronic Drug List Included (upon customer request) *Re. uires Aetna Rx AutoFill and Adherence to Drug Therapy . National Network Included (upon customer request) Included Maintenance Choice® - Mandatory (Requires Mandatory Mail Order)* Included (upon customer request) Maintenance Choice® - Incentivized (Requires Incentivized Mail Order)* Included (upon customer request) Maintenance Choice® - Voluntary* Aetna Rx Value Network* Aetna Rx Preferred Network* Aetna Rx Choice Network* (Includes National Network) Extended Days Supply Network* (Includes National Network) Retail to Mail Outreach *cannot be offered together Included (upon customer request) Included (upon customer request) Included (upon customer request) Included (upon customer request) Included (upon customer request) Included (upon customer request) o fr— Smart Edit Technology Integrated Intelligence Included ePrior Authorization Included Aetna Rx Check — Expanded Offering (Includes: Acute Frequency, Brand -to -Generic, High Utilisation, Therapeutic Duplication, Patient Safety, Streamlining Therapy, Therapeutic Optimization, Length of Therapy, Maximum Dose, Prescription Cascade) $0.55 Per Employee Per Month Save-A-Copay Optional at $1.00 Per Letter Per Targeted Member collected on a quarterly basis over the claim wire RX SFS Categories Aetna Healthy Actions - Rx Claim Savings Included / Optional o Care Engine Powered Condition -Based $0.25 Per Employee Per Month o Care Engine Powered Drug -Based $0.15 Per Employee Per Month o Drug Class Driven (Rx Claims Logic Only) $0.15 Per Employee Per Month Essentials Therapy Management Suite $30.00 Per Occurrence (Prior Authorization) o Precertification o Quantity Limits o Dose Optimization RX SFS Important Information About Aetna's Pharmacy Benefit Management Services Other Payments Aetna receives other payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates and which are paid separately to Aetna or designated third parties (e.g., mailing vendors, printers). These payments are to reimburse Aetna for the cost of various educational programs. These programs are designed to reinforce Aetna's goals of maintaining access to quality, affordable health care for Plan Participants and Customer. These goals are typically accomplished by educating physicians and Plan Participants about established clinical guidelines, disease management, appropriate and cost-effective therapies, and other information. Aetna may also receive payments from Prescription Drug manufacturers and other organizations that are not Prescription Drug Formulary Rebates as compensation for bona fide services it performs, such as the analysis or provision of aggregated information regarding utilization of health care services and the administration of therapy or disease management programs. These other payments are unrelated to the Prescription Drug Formulary Rebate arrangements, and serve educational as well as other functions. Consequently, these payments are not considered Rebates, and are not included in the Rebates provided to Customer, if any. Late Payment Charges If City Of Round Rock fails to provide funds on a timely basis to cover benefit payments as provided in the Service and Fee Schedule, and/or fails to pay service fees on a timely basis provided in such Service and Fee Schedule, Aetna will assess a late payment charge. The charges for 2013 are outlined below: i Late funds to cover benefit payments (e.g., late wire transfers): 12.0% annual rate ii Late payments of Service Fees: 12.0% annual rate In addition, Aetna will make a charge to recover its costs of collection including reasonable attorney's fees. We will notify City Of Round Rock of any changes in late payment interest rates. The late payment charges described in this section are without limitation to any other rights or remedies available to Aetna under the Service and Fee Schedule or at law or in equity for failure to pay. Participating Retail Pharmacy Network Aetna contracts with Participating Retail Pharmacies directly or through a pharmacy benefit management ("PBM") subcontract to provide Customer and Plan Participants with access to Covered Services. The prices negotiated and paid by Aetna or PBM to Participating Retail Pharmacies vary among Participating Retail Pharmacies in Aetna's network, and can vary from one pharmacy product, plan or network to another. Under the Statement of Available Service and Service and Fee Schedule, Customer and Aetna have negotiated and agreed upon a uniform or "lock -in" price to be paid by Customer for all Claims for Covered Services dispensed by Participating Retail Pharmacies. This uniform price may exceed or be less than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services. Where the uniform price exceeds the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna realizes a positive margin. In cases where the uniform price is lower than the actual price negotiated and paid by Aetna to the Participating Retail Pharmacy or PBM for dispensing Covered Services, Aetna reali>es a negative margin. Overall, lock -in pricing arrangements result in a positive margin for Aetna. Such margin is retained by Aetna in addition to any other fees, charges or other amounts agreed upon by Aetna and Customer, as compensation for the pharmacy benefit management services Aetna provides to Customer. Also, when Aetna receives payment from Customer before payment to a Participating Pharmacy or PBM, Aetna retains the benefit of the use of the funds between these payments. RX SFS Mail -Order and Specialty Covered Services Covered Services may be provided by Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy. In such circumstances, Aetna Mail Order Pharmacy refers to Aetna Rx Home Delivery, LLC, and Aetna Specialty Pharmacy refers to Aetna Specialty Pharmacy, LLC, both of which are subsidiaries of Aetna that are licensed Participating Pharmacies. Aetna's negotiated reimbursement rates with Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy, which are the rates made available to Customer, generally are higher than the pharmacies' cost of fulfilling orders of Prescription Drugs and Specialty Products and providing Covered Services and therefore these pharmacies realize an overall positive margin for the Covered Services they provide. To the extent Aetna Mail Order Pharmacy and Aetna Specialty Pharmacy purchase Prescription Drugs and Specialty Products for their own account, the cost therefor takes into account both up -front and retrospective purchase Discounts, credits and other amounts that they may receive from wholesalers, manufacturers, suppliers and distributors. Such purchase Discounts, credits and other amounts are negotiated by Aetna Mail Order Pharmacy, Aetna Specialty Pharmacy or their affiliates for their own account and are not considered Rebates paid to Aetna by manufacturers in connection with Aetna's Rebate program. Pharmacy Audit Rights and Limitations Aetna will share Rebate information with a qualified auditor under a strict confidentiality agreement that prohibits disclosure of such information to any third party, including Customer, and will not use such information for any purposes other than the Rebate audit. Auditor will be provided with the relevant portions of the applicable Formulary Rebate contracts, including, but not limited to, the manufacturer names, Prescription Drug names, details of all monies as defined by the term Rebate, and Rebate amounts for the Prescription Drugs being audited. The parties will reasonably cooperate to select Prescription Drugs for each audit that: (i) represent the fewest unique manufacturer Rebate contracts required for audit so that the selected drugs represent up to a maximum of 1 5% of Customer's Rebates; and (ii) are subject to manufacturer Rebate agreements that do not contain restrictions prohibiting Aetna from disclosing to Customer portions of such contracts concerning the Rebates, payments or fees payable thereunder. For purposes of this Section, the term "Aetna" as defined in Section III of the Statement of Available Services shall not include subcontractor. In addition to the above stated auditor qualification, auditor must also have no conflict of interest or past business or other relationship which would prevent the auditor from performing an independent audit to conclusion. A conflict of interest includes, but is not limited to, a situation in which the audit agent: (i) is employed by an entity, or any affiliate of such entity, which is a competitor to Aetna's benefits or Claims administration business or Aetna's mail order or specialty pharmacy businesses; (ii) is affiliated with a vendor subcontracted by Aetna to adjudicate Claims or provide services in connection with Aetna's administration of benefits or provision of mail order or specialty pharmacy services. Auditors shall enter into an appropriate confidentiality agreement with, and acceptable to, Aetna prior to conducting any audit. Customer is entitled to only one annual Rebate audit. Claim audits are subject to the above referenced audit standards for Rebates in the case of a physical, on-site, Claim - based audit. In the case of electronic Claim audits that follow standard pharmacy benefit audit practices where electronic re -adjudication of Claims is requested and processed off-site, Customer may elect .to audit 100% of Claims. Customer is entitled to only one annual Claim audit. Maximum Allowable Cost ("MAC") As part of the administration of Covered Services, Aetna maintains MAC Lists of Prescription Drug products identified as requiring pricing management due to the number of manufacturers, utilisation and/or pricing volatility. Criteria for inclusion on a MAC List include whether the Prescription Drug has readily available Generic Drug equivalents and a cost basis that will allow for pricing below Brand Drug rates. Aetna maintains correlative MAC Lists based on current price references provided by drug data compendia, market pricing, availability information from Generic Drug manufacturers and other sources which are subject to change. Aetna Specialty Pharmacy Information regarding the pricing and limited distribution or restricted access of Specialty Products is set forth in Addendum I to this Service and Fee Schedule. RX SFS Aetna Specialty Pharmacy Except for the specific items listed in the Exceptions or Limited Distribution tables below, Specialty Products will have the following Discounts: Distribution Channel Standard Discounts Dispensing Fee Preferred AWP - 13.50% $0.00 Specialty Products will not be available through Aetna Rx Home Delivery. Limited Distribution Drugs Some Specialty Products may be subject to limited distribution or restricted access. This means that certain Specialty Products may only be available at one or a limited number of pharmacies. Limited distribution is generally due to (i) the FDA imposing restrictions on the distribution of a Specialty Product to certain pharmacies and (ii) special handling, coordination of care or patient education that cannot be handled by all pharmacies. While most Specialty Products may be ordered through Aetna Specialty Pharmacy, the Specialty Products listed below are currently not available. However, if Aetna receives a prescription order for any of these Specialty Products, it will transfer the order to a Participating Pharmacy where the Specialty Products are available and inform the prescribing physician and Plan Participant of same. ADAGEN Limited Distributed Products IRESSA SABRIL ARALAST OFORTA SUCRAID ARCALYST ONSOLIS TIKOSYN BERINERT ORFADIN TYVASO CINRYZE ORTHOCLONE VENTAVIS CYSTADANE PROLASTIN VISUDYNE ELAPRASE PROMACTA XENAZINE EXJADE REMODULIN XYREM FLOLAN RETISERT ZAVESCA ILARIS RIASTAP ZEMAIRA IMPLANON PROCRIT INJ Exceptions To Standard Pricing The following Specialty Products have the Discounts shown for the Preferred distribution channel. Network Therapeutic Category Drug Name Medication Form AWP - Discount Dispensing Fee ANEMIA ARANESP INJ 12.50% $0.00 ANEMIA ATGAM INJ 13.50% $0.00 ANEMIA EPOGEN . INJ 13.50% $0.00 ANEMIA INFED INJ 13.50% $0.00 ANEMIA NIFEREX OR 12.50% $1.75 ANEMIA PROCRIT INJ 13.50% $0.00 ANEMIA REVLIMID OR 12.50% $1.75 ANEMIA VENOFER INJ 13.50% $0.00 ASTHMA PULMOZYME INJ 13.50% $0.00 ASTHMA TOBI OR 12.50% $1.75 ASTHMA XOLAIR INJ 12.50% $0.00 COLONY STIMULANT LEUKINE INJ 12.50% $0.00 RX SFS Addendum 1 &� Therapeutic Category Drug Name Medication Form . AWP Discount -lism■ Dispensing" _ - Fee COLONY STIMULANT MOZOBIL INJ 13.50% $0.00 COLONY STIMULANT NEUMEGA INJ 13.50% $0.00 COLONY STIMULANT NEULASTA INJ 11.50% $0.00 COLONY STIMULANT NEUPOGEN INJ 13.50% $0.00 CROHN'S DISEASE CIMZIA INJ 13.50% $0.00 CROHN'S DISEASE REMICADE INJ 13.50% $0.00 DEEP VEIN THROMBOSIS ARIXTRA INJ 13.50% $0.00 DEEP VEIN THROMBOSIS FRAGMIN INJ 13.50% $0.00 DEEP VEIN THROMBOSIS HEPARIN INJ 13.50% $0.00 DEEP VEIN THROMBOSIS INNOHEP INJ 13.50% $0.00 DEEP VEIN THROMBOSIS LOVENOX INJ 11.50% $0.00 ENZYME REPLACEMENT ALDURAZYME INJ 12.50% $0.00 ENZYME REPLACEMENT CEREZYME INJ 11.50% $0.00 ENZYME REPLACEMENT FABRAZYME INJ 10.25% $0.00 GROWTH HORMONE GENOTROPIN INJ 10.50% $0.00 GROWTH HORMONE HUMATROPE INJ 13.50% $0.00 GROWTH HORMONE NORDITROPIN INJ 13.50% $0.00 GROWTH HORMONE NUTROPIN INJ 12.50% $0.00 GROWTH HORMONE PROTROPIN INJ 17.00% $0.00 GROWTH HORMONE SAIZEN INJ 11.50% $0.00 GROWTH HORMONE SEROSTIM INJ 12.50% $0.00 GROWTH HORMONE SOMATULINE DEPOT INJ 13.50% $0.00 GROWTH HORMONE SUPPRELIN LA KIT IMPL 13.50% $0.00 GROWTH HORMONE 1'EV- 1'ROPIN INJ 17.00% $0.00 GROWTH HORMONE ZORBTIVE INJ 13.50% $0.00 HEMOPHILIA ADVATE INJ 27.00% $0.00 HEMOPHILIA ALPHANATE INJ 29.25% $0.00 HEMOPHILIA BENEFIX INJ 14.50% $0.00 HEMOPHILIA FEIBA INJ 37.50% $0.00 HEMOPHILIA HELIXATE INJ 31.00% $0.00 HEMOPHILIA HEMOFIL INJ 37.50% $0.00 HEMOPHILIA HUMA 1'E - P INJ 9.25% $0.00 HEMOPHILIA KOGENA 1'E INJ 42.50% $0.00 HEMOPHILIA MONARC INJ 29.25% $0.00 HEMOPHILIA MONOCLA 1E INJ 29.25% $0.00 HEMOPHILIA MONONINE INJ 27.00% $0.00 HEMOPHILIA NOVOSEVEN INJ 29.25% $0.00 HEMOPHILIA PROPLEX T INJ 14.00% $0.00 HEMOPHILIA RECOMBINATE INJ 29.25% $0.00 HEMOPHILIA STIMATE INJ 12.50% $0.00 HEMOPHILIA XYNTIIA INJ 29.25% $0.00 HEMOPHILIA ALL OTHER HEMOPHILIA NOT LIS IED ABOVE INJ 11.50% $0.00 HEPATITIS ALFERON INJ 13.50% $0.00 RX SFS Addendum 1 RX SFS Addendum 1 Network Therapeutic Category :_.. Drug Name Medication Form AWP' Discount Dispensing Fee HEPATITIS BAYGAM INJ 11.50% $0.00 HEPATITIS COPEGUS OR 12.50% $1.75 HEPA 1'1'1'1S INFERGEN INJ 17.00% $0.00 HEPATITIS HEPSERA INJ 13.50% $0.00 HEPATITIS NABI HB INJ 13.50% $0.00 HEPATITIS PEG INTRON INJ 13.50% $0.00 HEPATITIS PEGASYS INJ 13.50% $0.00 HEPATITIS REBETOL OR 12.50% $1.75 HEPATITIS REBE1'RON INJ 18.00% $0.00 HEPATITIS RIBAVIRIN (Generic) OR MAC $1.75 HEPATITIS ROFLRON-A INJ 12.50% $0.00 HEPATITIS B TYZEKA OR 12.50% $1.75 HIV / AIDS ATRIPLA OR 12.50% $1.75 HIV / AIDS FOSCAVIR INJ 17.00% $0.00 HIV / AIDS FUZEON INJ 13.50% $0.00 HIV / AIDS ISENTRESS OR 12.50% $1.75 HW / AIDS VISTIDE INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME CARIMUNE INJ 38.00% $0.00 IlMMUNODEFICIENCY SYNDROME FLEBOGAMMA INJ 35.00% $0.00 IMMUNODEFICIENCY SYNDROME GAMIIb1UNE INJ 17.00% $0.00 IMIvIUNODEFICIENCY SYNDROME GAMMAGARD S/D INJ 42.50% $0.00 IMMUNODEFICIENCY SYNDROME GAMMAGARD LIQUID INJ 29.25% $0.00 IMMUNODEFICIENCY SYNDROME GAMUNEX INJ 27.00% $0.00 IMMUNODEFICIENCY SYNDROME PANGLOBULIN INJ 38.00% $0.00 IMMUNODEFICIENCY SYNDROME POLYGAM INJ 48.00% $0.00 IMMUNODEFICIENCY SYNDROME PRIVIGEN . INJ 11.50% $0.00 IMMUNODEFICIENCY SYNDROME RHOGAM PLUS INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME THYMOGLOBULIN INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME VIVAGLOBIN INJ 37.50% $0.00 IM1ViUNODEFICIENCY SYNDROME WINRHO SDF INJ 13.50% $0.00 IMMUNODEFICIENCY SYNDROME ALL OTHER IVIG NOT LISTED ABOVE INJ 11.50% $0.00 IIviMUNOSUPPRESSION W/TRANSPLANT ALPRAZOLAM OR 16.00% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT AZATHIOPRINE OR 16.00% $1.75 RX SFS Addendum 1 Therapeutic Category Drug Name Medication Form ., imilmilmiiiiiii AWP Discount Dispensing Fee, IMMUNOSUPPRESSION W/ TRANSPLANT CF.i LCEPT OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT CYCLOSPORINE OR 16.00% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT CYTOGAM INJ 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT GENGRAF OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT IMURAN OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT KEPIVANCE INJ 13.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT MYFORTIC OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT NEORAL OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT PROGRAF OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT PROGRAF INJ 12.50% $ 175 IMMUNOSUPPRESSION W/TRANSPLANT RAPAMUNE OR 12.50% $1.75 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE INJ 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE SOL 12.50% $0.00 IMMUNOSUPPRESSION W/TRANSPLANT SANDIMMUNE OR 12.50% $1.75 INFERTILITY BRAVELLE INJ 21.75% $0.00 INFERTILITY CETROTIDE INJ 16.75% $0.00 INFERTILITY CHORIONIC GONADOTROPIN INJ 16.75% $0.00 INFERTILITY FOLLISTIM AQ INJ 13.50% $0.00 INFERTILITY GANIRELIX INJ 16.75% $0.00 INFERTILITY GONAL F INJ 12.50% $0.00 INFERTILITY LEUPROLIDE KIT INJ 27.00% $0.00 INFERTILITY LUVERIS INJ 21.75% $0.00 INFERTILITY MENOPUR INJ 2L75% $0.00 INFERTILITY NOVAREL INJ 16.50% $0.00 INFERTILITY OVIDREL INJ 16.50% $0.00 INFERTILITY PREGNYL INJ 21.75% $0.00 INFERTILITY REPRONEX INJ 21.75% $0.00 LHRH AGONIST LUPRON INJ 13.50% $0.00 LHRH AGONIST LUPRON DEPOT INJ 13.50% $0.00 LHRH AGONIST PLENAXIS INJ 13.50% $0.00 LHRH AGONIST ZOLADEX INJ 24.00% $0.00 MULTIPLE SCLEROSIS AVONEX INJ 12.50% $0.00 MULTIPLE SCLEROSIS BETASERON INJ 11.50% $0.00 RX SFS Addendum 1 RX SFS Addendum 1 Network Therapeutic Category" Drug Name Medication; Form AWP Discount Dispensing Fee MULTIPLE SCLEROSIS COPAXONE INJ 12.50% $0.00 MULTIPLE SCLEROSIS EXTAVIA INJ 11.50% $0.00 MULTIPLE SCLEROSIS MYOBLOC INJ 13.50% $0.00 MULTIPLE SCLEROSIS REBIF INJ 12.50% $0.00 MULTIPLE SCLEROSIS TYSABRI INJ 13.50% $0.00 NEUROLOGY BOTOX INJ 9.25% $0.00 NEUROLOGY CEREBYX INJ 17.00% $0.00 NEUROLOGY DYSPORT INJ 11.50% $0.00 NEUROLOGY CLONAZEPAM OR 16.00% $1.75 NEUROLOGY LIORESAL INTRATHECAL INJ 17.00% $0.00 ONC - ANTIEMETIC ANZEMET INJ 13.50% $0.00 ONC - ANTIEMETIC ATROPINE INJ 13.50% $0.00 ONC - ANTIANEMIC CYANOCOBALAMIN INJ 13.50% $0.00 ONC - ANTIEMETIC DELTASONE OR 16.00% $1.75 ONC - ANTIEMETIC DEXAMETHASONE INJ 13.50% $0.00 ONC - ANTIEMETIC EMEND INJ 15.00% $0.00 ONC - ANTIEMETIC HYDROXYZINE OR 13.50% $1.75 ONC - ANTIEMETIC KYTRIL INJ 16.00% $0.00 ONC - ANTIEMETIC METHYLPREDNISOLONE INJ 13.50% $0.00 ONC - ANTIEMETIC PROCHLORAPDERAZINE CP INJ 17.00% $0.00 ONC - ANTIEMETIC TIGAN OR 13.50% $1.75 ONC - ANTIEMETIC ZOFRAN OR 12.50% $1.75 ONC ANTIHYPERCALCEMIC PAMIDRONATE INJ 13.50% $0.00 ONC - CHEMOTHERAPY ALOXI INJ 13.50% $0.00 ONC - CHEMOTHERAPY ARIMIDEX OR 12.50% $1.75 ONC - CHEMOTHERAPY AVASTIN INJ 10.25% $0.00 ONC - CHEMOTHERAPY BCG LIVE INJ 13.50% $0.00 ONC - CHEMOTHERAPY BLEOMYCIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY CAMPTOSAR INJ 13.50% $0.00 ONC - CHEMOTHERAPY CASODEX OR 12.50% $1.75 ONC - CHEMOTHERAPY COSMEGEN INJ 13.50% $0.00 ONC - CHEMOTHERAPY CYTARABINE INJ 13.50% $0.00 ONC - CHEMOTHERAPY CYTOXAN INJ 12.50% $0.00 ONC - CHEMOTHERAPY DAUNORUBICIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY DOXIL INJ 13.50% $0.00 ONC - CHEMOTHERAPY DOXORUBICIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELITEK INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELIGARD INJ 13.50% $0.00 ONC - CHEMOTHERAPY ELOXATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY ERBITUX INJ 13.50% $0.00 ONC - CHEMOTHERAPY ETHYOL INJ 13.50% $0.00 ONC - CHEMOTHERAPY ETOPOSIDE INJ 13.50% $0.00 ONC - CHEMOTHERAPY FASLODEX INJ 13.50% $0.00 RX SFS Addendum 1 Therapeutic Category Drug Name _ . Medication Form ; AWP Discount Dispensing:: Fee ONC - CHEMOTHERAPY GEMZAR INJ 13.50% $0.00 ONC - CHEMOTHERAPY GLEEVEC OR 10.50% $1.75 ONC - CHEMOTHERAPY HERCEPTIN INJ 10.50% $0.00 ONC - CHEMOTHERAPY HYCAMTIN OR 12.50% $1.75 ONC - CHEMOTHERAPY HYCAMTIN INJ 12.50% $0.00 ONC - CHEMOTHERAPY HYDROXYUREA OR 16.00% $1.75 ONC - CHEMOTHERAPY INTRON A INJ 12.50% $0.00 ONC - CHEMOTHERAPY LEUCOVORIN OR 13.50% $1.75 ONC - CHEMOTHERAPY MERCAPTOPURINE OR 16.00% $1.75 ONC - CHEMOTHERAPY METHOTREXA 1L INJ 12.50% $0.00 ONC - CHEMOTHERAPY MUSTARGEN INJ 13.50% $0.00 ONC - CHEMOTHERAPY MITOMYCIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY NAVELBINE INJ 13.50% $0.00 ONC - CHEMOTHERAPY NEXAVAR OR 13.50% $1.75 ONC - CHEMOTHERAPY NOVANTRONE INJ 13.50% $0.00 ONC - CHEMOTHERAPY OCTREOTIDE INJ 13.50% $0.00 ONC - CHEMOTHERAPY PACLITAXEL INJ 13.50% $0.00 ONC - CHEMOTHERAPY PARAPLATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY PROLEUKIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY RITUXAN INJ 12.50% $0.00 ONC - CHEMOTHERAPY TAMOXIFEN OR 16.00% $1.75 ONC - CHEMOTHERAPY TARCEVA OR 11.50% $1.75 ONC - CHEMOTHERAPY TAXOTERE INJ 13.50% $0.00 ONC - CHEMOTHERAPY 1'1~.MODAR OR 12.50% $1.75 ONC - CHEMOTHERAPY THALOMID OR 12.50% $1.75 ONC - CHEMOTHERAPY TICE BCG INJ 13.50% $0.00 ONC - CHEMOTHERAPY SANDOSTATIN INJ 13.50% $0.00 ONC - CHEMOTHERAPY SU I'LNT OR 14.50% $1.75 ONC - CHEMOTHERAPY VELCADE INJ 13.50% $0.00 ONC - CHEMOTHERAPY VINCRISTINE INJ 13.50% 50.00 ONC - CHEMOTHERAPY VOTRIENT OR 12.50% $1.75 ONC - CHEMOTHERAPY XELODA OR. 12.50% $1.75 ONC - CHEMOTHERAPY ZENAPAX INJ 13.50% $0.00 ONC - DIURETIC MANNITOL INJ 13.50% $0.00 ONC - HEMATOPOIETIC NEULASTA INJ 11.50% $0.00 ONC - HYPERCALCEMIC AREDIA INJ 17.00% $0.00 ONC - HYPERCALCEMIC ZOMETA INJ 13.50% $0.00 OSTEOARTHRITIS EUFLEXXA INJ 13.50% $0.00 OS I'LOARTHRITIS HYALGAN INJ 13.50% $0.00 OS I.BOARTHRITIS ORTHOVISC INJ 13.50% $0.00 OS 1'1OARTHRITIS SUPARTZ INJ 17.00% $0.00 OS I'hOARTHRITIS SYNVISC INJ 13.50% $0.00 OSI'hOPOROSIS FOR 1'LO INJ 11.50% $0.00 OTHER ACTHAR GEL INJ 13.50% $0.00 RX SFS Addendum 1 Therapeutic Category Drug Name Medication Form AWP Discount Dispensing Fee OTHER KUVAN OR 13.50% $1.75 OTHER INCRELEX INJ 13.50% $0.00 OTHER LUCENTIS INJ 11.50% $0.00 OTHER RECLAST INJ 13.50% $0.00 OTHER RETISERT INJ 17.00% $0.00 OTHER ROCEPHIN INJ 13.50% $0.00 OTHER SOMAVERT INJ 13.50% $0.00 OTHER THYROGEN INJ 10.50% $0.00 OTHER VIVITROL INJ 10.50% $0.00 OTHER ALL OTHER INJECTABLEINJ DRUGS NOT LIS FED 13.50% $0.00 OTHER TRADITIONAL ORALS, CREAMS & INHALERS OR 12.50% $1.75 OTHER COMPOUNDED MEDICATIONS & SUPPOSITORIES 16.00% $11.75 PARKINSONS APOKYN INJ 13.50% $0.00 PSORIASIS AMEVIVE INJ 13.50% $0.00 PSORIASIS SORIATANE KIT OR 12.50% $1.75 PSORIASIS S 1'JLARA INJ 11.50% $0.00 PULMONARY AR1kRIAL HYPERTENSION ADCIRCA OR 16.00% $1.75 PULMONARY ARTERIAL HYPER 1'1iNSION LETAIRIS OR 12.50% $1.75 PULMONARY ARTERIAL HYPERTENSION TRACLEER OR 13.50% $1.75 PULMONARY FIBROSIS ACTIMMUNE INJ 12.50% $0.00 RHEUMATOID ARTHRITIS ENBREL INJ 12.50% $0.00 RHEUMATOID ARTHRITIS HUMIRA INJ 12.50% $0.00 RHEUMATOID ARTHRITIS HYDROXYCHLOROQUINE OR 16.00% $1.75 RHEUMATOID ARTHRITIS KINERET INJ 13.50% $0.00 RHEUMATOID ARTHRITIS MYOCHRYSINE INJ 17.00% $0.00 RI-IEUMATOID ARTHRITIS ORENCIA INJ 13.50% $0.00 RHEUMATOID ARTHRITIS SIMPONI INJ 13.50% $0.00 RSV SYNAGIS INJ 13.50% $0.00 Note: This list will be updated from time to time and may include adjunct therapies used in the treatment of complex conditions. For drugs where an AB -rated generic equivalent is available, the pricing will be according to the current MAC list. RX SFS Addendum 1 SERVICE AND FEE SCHEDULE Customer hereby elects to receive the Services designated below. The corresponding Administrative Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Fees for services performed by Aetna in accordance with the SAS will be determined by Aetna in accordance with the following. 1. In General. Fees for standard services as described in the SAS consist of (a) a monthly administration fee and (b) other fees. The corresponding Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 shall be as follows: Services Service Fees Monthly Administration Fee $ 5.50 Per Participant/Per Month Other Fees — Debit Card Fee $ 1.00 Per Participant/Per Month In general, the number of Plan Participants on which the per -Participant -per -month fee is based for any month is the sum of (1) the number of Plan Participants on the first day of the Plan Year plus (2) the number of Plan Participants that have been added during the Agreement Period. This number is determined as of the first day of each month of the Agreement Period and any Transition Period, as defined in the Appendix to this SAS. Plan Participants who terminate during a month are included in the Plan Participant count for purposes of determining that month's per - Participant fee. The fees shown above are based on administrative services selected. Aetna may adjust the Service Fees effective as of the date on which any of the following occurs: (a) If, for any Service, there is a 10% change in the number of employees participating in the health care flexible spending account and dependent care flexible spending account from the number assumed in Aetna's quotation of September 1; 2009 or from any subsequently reset assumptions. (b) Change in Plan — A material change in the Plan is initiated by the Customer or by legislative action. (c) Change in Administration — A material change in claim payment requirements or procedures, account structure or any other change materially affecting the manner or cost of paying benefits. 2. Late Payment Charges: In addition to any termination rights under the Services Agreement which may apply, if the Customer fails to provide funds on a timely basis to cover Plan benefit payments as provided in Section 8 of the Master. Services Agreement, and/or fails to pay Service Fees on a timely basis as provided in Section 6 of the Master Services Agreement, Aetna will assess a late payment charge. The charge for 2014 will be as follows: (a) late funds to cover benefit payments (e.g., late wire transfers): 12% annual rate (b) late payments of Service Fees: 12% annual rate In addition, Aetna will assess a charge to recover its costs of collection including reasonable attorneys' fees. The late payment charge percentage specified above is subject to change annually. FSA HC/DC SFS SERVICE AND FEE SCHEDULE The corresponding Service Fees effective for the period beginning January 1, 2014 and ending December 31, 2014 are specified below. They shall be amended for future periods, in accordance with Section 6 of the Master Services Agreement. Individual Billing Administration COBRA Administrative Fees Installation or Restructure Fee $1,000.00 For a direct billing arrangement setup within a control number. Payable only in the first year. A full or partial charge may also be applied for restructures after the initial setup, e.g., whenever new records must be established for existing continuees who are being moved to a new or revised control, suffix, plan or account structure. Fee Per COBRA Participant Per Month for Standard Services (2% COBRA PPPM Fee administration fee retained by Aetna) Monthly fee charged for each primary participant enrolled in COBRA $7.85 Fees For Additional Services Initial/General Notification $3.35 The Customer requests that Aetna send out notification to each newly lured employee detailing COBRA rights in the event that they or a covered family member experience a COBRA event. COBRA Qualifying Event Election Notification After the qualifying event has occurred, the Customer requests that Aetna send out enrollment notification materials to each Qualified Beneficiary. Fees vary based on method of Aetna receiving source information from Customer. Electronic File (Secure Web Transfer) $16.45 Paper — standard format Not Applicable Maintenance of Eligibility Only Services PPPM Fee Plan Participants maintained in the Individual Billing Not Applicable System for eligibility only HIPAA Certification Notices Cost per certificate mailed $7.50 Individual Billing Administration fees are billed directly to the Customer on a quarterly basis. The quarter commences with the administration effective date. COBRA SFS