NHO no RAC eff 010110 - Benefits Online

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NHO no RAC eff 010110 - Benefits Online

Welcome to Northrop GrummanNew Hire Benefits Orientation


Today’s Agenda• Northrop Grumman Health Plan• Northrop Grumman Savings Plan• Enrollment• Questions2


Northrop Grumman Health Plan OverviewBasic benefits• Basic Life• Basic Accidental Deathand Dismemberment(AD&D)• Basic Long-TermDisability (LTD)*• Employee AssistanceProgram (EAP)Optional benefits• Medical• Dental• Vision• Optional LTD• Optional life insurance(employee, spouse,children)• Optional AD&D insurance(employee, family)• Flexible Spending Accounts(FSAs)• Group LegalYou mustenroll toselect thesebenefits* 100% paid by some business units3


Who Is Eligible?• Most employees who regularly work 20 or morehours per week• Eligible dependents– Your spouse– Your unmarried child(ren) under age 19 (or underage 25 if full-time students)– Your unmarried child(ren) of any age who aredisabled– Your same-sex or opposite-sex domestic partner andhis or her eligible dependent child(ren)4


If Your Spouse or Domestic Partner Works• For Northrop Grumman:– One of you can enroll as an employee, the other as a dependentOR– Both of you can enroll separately as an employee• Employees may cover one another for spouse life insurance• Only one of you can enroll your eligible dependent childrenin each type of coverage (medical, dental, vision, life, AD&D)• For another employer:– If your spouse or domestic partner’s employer offers medical coverageand pays at least 50% of the cost of the plan, your spouse or domesticpartner must enroll in his/her employer’s medical plan during theirnext annual enrollment to be eligible to enroll in medical coveragethrough the Northrop Grumman Health Plan– If your spouse’s or domestic partner’s employer subsidizes less than50%, he/she is eligible to enroll in medical coverage through theNorthrop Grumman Health Plan without enrolling in his/her employer’splan5


How the Plan Works• You choose the coverage that meets your needs• Coverage levels for medical, dental, vision– Employee only– Employee + spouse– Employee + child(ren)– Employee + family• You must make your choices by the deadline shown on yourenrollment letter (within 31 days of your hire date)• Your choices remain in effect for the entire benefit plan year, aslong as you are eligible, July 1, 2009 — June 30, 2010– You cannot make changes until the next enrollment period (May2010) unless you have a qualified life event (e.g., marriage orbirth of a child)6


Medical Plan Options• Anthem Blue Cross Preferred ProviderOrganization (PPO)• Aetna Exclusive Provider Organization (EPO)– Available in many states nationwide• Anthem Consumer-Driven Health Plan (CDHP)• Health Maintenance Organization (HMO) optionsand Regional EPO options– Available in some areas only• Aetna Global Benefits (overseas employees)7


Anthem Blue Cross Preferred PPO Option• The PPO option is available in all U.S. locations• You can go to any doctor or hospital– You pay less when you utilize a provider in the Anthem PPOnetwork– You do not need to select a Primary Care Physician (PCP)• Prescription drug coverage through Express Scripts– Network includes most major pharmacy chains– Mandatory Mail Service Program for long-term maintenancemedications, up to a 90-day supply delivered to your home– Customer service line available 24/7• Mental health/substance abuse treatment coveragethrough ValueOptions8


The Anthem Blue Cross Preferred PPO OptionBenefit planyeardeductibleOffice visitcopayIn-network$500 perindividual/$1,000 perfamily$20 (specialistvisit: $40)Preferred PPOCoinsurance 10% 40%Benefit planyear out-ofpocketmaximum$3,000 perindividual/$6,000 perfamilyOut-ofnetwork$800 perindividual/$1,600 perfamily40%coinsurance$5,000 perindividual/$10,000 perfamilyFor more details, and to accesscomparison charts for all plans, go toBenefits OnLine athttp://benefits.northropgrumman.com9


EPO and HMO Options• An EPO works like an HMO– In most plans, you and your covered family membersselect a primary care provider (PCP) to coordinate care– You access services from EPO providers only (except in anemergency)– When you access covered services, you pay a copay, andthe plan pays the rest — there is no deductible• One national EPO offered through Aetna (available inmost states nationwide)• Regional EPOs vary by state and/or ZIP code– California – Health Net, UnitedHealthcare– North Carolina – CIGNA– Virginia (Newport News area) – CIGNA10


Aetna Global Benefits• Available only for employees located overseas• Dental coverage is included with the medical(no separate election needed)• Offers coverage both overseas as well aswithin the U.S.• Coverages offered are based on whetherservices incurred overseas or within U.S:– Overseas– In-network within U.S.– Out-of-network within U.S.– Out-of-area within U.S.11


Prescription Drug Coverage in the PPOand EPOsYour cost varies depending on the type of prescription drug you purchaseType of DrugGenericNetwork Retail Pharmacy(30-day supply)$5 copay or 10% coinsurance,whichever is greaterPreferred Brand $20 copay or 10%coinsurance, whichever isgreaterBrand $40 copay or 10%coinsurance, whichever isgreaterMail Service Pharmacy(up to 90-day supply)$5 copay or 10%coinsurance, whicheveris greater$20 copay or 10%coinsurance, whicheveris greater$40 copay or 10%coinsurance, whicheveris greaterIn the PPO, you can go to a non-network pharmacy and pay 50% of the eligible cost. (Non-networkcoverage is not available in the EPOs.)The annual out-of-pocket maximum for prescription drugs is:• In the PPO – $2,000/individual and $4,000/family• In the EPOs – $1,500/individual and $3,000/family12


Prescription Drug Coverage in the PPOand EPOs• Generics preferred:– Your prescriptions automatically will be filled with a chemicallyequivalent generic drug, if available and as appropriate.– If you or your doctor requests a brand-name drug when a genericequivalent is available, you will pay your copayment, plus thedifference in cost between the generic drug and the brand-name drug.• Maintenance Medication Program:– If you take a maintenance prescription drug to treat an ongoingmedical condition, you must fill your prescription using the mail-orderservice.• In order to allow for time to set up the mail-order service, new prescriptionsmay initially be filled 2 times at a retail pharmacy.– You will receive up to a three–month supply of your prescription drug,typically for less than you would pay for the same amount of your drugat a retail pharmacy, and your medication is delivered to you.13


Step Therapy in the PPO Plan• Designed to promote the use of lower-cost,and equally effective, generic drugs beforeparticipants “step up” to higher-cost brandname drugs.• Designed for people who take maintenanceprescription drugs on a regular basis totreat an ongoing medical condition.• Step Therapy will apply even if your doctorwrites “Dispense as Written” on yourprescription.14


Anthem CDHP OptionThe Anthem CDHP ProgramPreventiveCare• 100% coveragefor nationallyrecommendedservices• No deductionsfrom the HRAPreventive Care 100% CoverageHealthReimbursementAccountTraditionalHealthCoverage• Benefit plan year allocation fromNorthrop Grumman• Plan pays 100% when funds areavailable• Use it on HRA ExtrasBridge • Employee’s responsibility if expensesexceed the benefit plan year HRAallocation• Paid only as expenses are incurred• Can be reduced or eliminated by HRArollover• Additional protection covers theservices allowed by NorthropGrumman• You pay coinsurance for coveredservices• 100% coverage after coinsurancemaximum is met15


Anthem CDHP Plan Year AmountsEmployeeEmployee +SpouseEmployee+Child(ren)FamilyPreventive Care 100%Health ReimbursementAccount (HRA)BridgeTraditionalHealth CoverageCoinsurance MaximumMental Health/Substance Abuseand prescription drug benefitsare covered under the plan.$1,000 $1,500 $1,500 $2,000$800 $1,200 $1,200 $1,60090% covered for providers who participate in theAnthem network60% of R&C for providers who do not participate in theAnthem Network$4,200 $6,300 $6,300 $8,40016


Best Doctors• Provides you with the opportunity to have a worldrenowneddoctor review your medical case andensure you have the right diagnosis• Available to employees and their covereddependents who are enrolled in a medical planthrough the Northrop Grumman Health Plan• Included in the cost of your health plan – you donot pay any additional cost17


Tobacco Cessation ProgramFree & Clear - Quit For Life• Personalized quit program• Confidential phone based treatmentsessions• Delivery of recommended nicotinereplacement products (e.g. the patch,gum)• Available to employees and theirdependents enrolled in a NorthropGrumman medical plan option18


Employee Assistance Program (EAP)Work/Life Program• Confidential counseling, support and resources, at no cost, forall Northrop Grumman employees and their eligible familymembers• Designed to help with personal and work-related issues• Work/Life benefits include information, resources and referralsfor child and elder care, adoption assistance, relocationinformation and more• Provides 8 free sessions, (per person per issue per plan year),with a licensed clinician who is close to work or home1-800-982-816124 hrs a day, 7 days a week19


Dental Plan Options• Three Delta Dental Preferred Provider Organization(PPO) Plan Options– Dental Care Plan Option– Dental Care Plus Plan Option (includes orthodontia)– Preventive Care Plan Option• CIGNA Dental Health Maintenance Organization(DHMO) Option (in some areas)– You must select a CIGNA DHMO primary dentist– No coverage if you access care without a referralfrom your CIGNA DHMO primary dentist– You pay a copay and the plan pays the rest– Includes orthodontia20


Comparing the Delta Dental PPO Plan OptionsDental Care Dental Care Plus Preventive CareDeductiblePlan Year Maximum(per person)$50/$100 Preferred$100/$200 Premier$150/$250 Out-of-Network$1,500 Preferred$1,250 Premier$1,000 Out-of-network$50/$100 Preferred$100/$200 Premier$150/$250 Out-of-Network$2,000 Preferred$1,500 Premier$1,000 Out-of-network$0(in- and out-of-network)$500(in- and out-of-network)CoveragePreventive 100% 100% 100%BasicRestorative80% Preferred75% Premier70% Out-of-network80% Preferred75% Premier70% Out-networkNot coveredMajor50% 50% Not coveredRestorativeOrthodontia Not covered 50% up to a lifetimemaximum of $2,000Not covered21


Vision Plan Option• Northrop Grumman Vision Plan– Administered by Vision Service Plan (VSP)– You can see any vision provider, but will save money whenyou visit a provider in the VSP network• In-network coverage includes:– Exams and lenses each benefit plan year ($10 copay)– Frames every two benefit plan years ($10 copay)• Plan pays up to $120– Contact lenses (instead of eyeglasses) every benefit planyear• Plan pays up to $105• Includes disposable lenses22


Flexible Spending Account (FSA)OptionsHealthCare FSADescription– Allows you to set aside pre-taxmoney to pay for eligible health careexpenses (e.g. deductibles,copays, coinsurance, orthodonticsand some over-the-counter drugs)– Elections are made on an annual basisMaximum AnnualContribution$5,000DependentDay Care FSA– You can set aside pre-tax dollars fromyour paycheck to pay for eligibledependent day care expenses– Elections are made on an annual basis$5,000**If you earn $105,000 or more, your annual contribution limit to the Dependent Care FSA is $2,500.You must use all the dollars in your FSA accounts,or lose them at the end of the grace period (incur expenses by September 15, 2010and file them by December 31, 2010), so estimate your expenses carefully!23


Automatic FSA Claims Reimbursement• Your carriers will submit claims on your behalf if youcontribute to the Health Care FSA and enroll in:– Anthem PPO• including Value Options– Anthem CDHP– Aetna EPO– Delta Dental PPO– Health Net EPO– UnitedHealthcare EPO– Vision Service Plan• Benesyst (the FSA claims administrator) will automaticallyreimburse you through your health care FSA• You are automatically enrolled in this feature and must callthe Northrop Grumman Benefits Center to opt out.24


Pharmacy Benefits Card for Health Care FSA• Health Care FSA participants will receive a PharmacyBenefits Card to be used for all prescription (retail andmail-order) and over-the-counter (OTC) drug purchases• Any eligible items or co-pays will be automaticallycharged to your FSA account (as long as there is asufficient balance)• If you utilize mail order service for delivery of yourprescriptions, be sure to provide your carrier with yourPharmacy Benefits Card account number• Visit www.benesyst.net for a list of participatingmerchants25


Long-Term Disability (LTD) Benefits• Basic LTD*– 50% of your monthly base salary• Optional LTD– Your options are:• Additional 10% for total coverage of 60% of yourmonthly base salary• Additional 20% for total coverage of 70% of yourmonthly base salary– No evidence of insurability (EOI) is required if youenroll when newly eligible• Maximum monthly benefit of $15,000 (reduced byany other disability income you receive)* 100% paid by some business units26


Life Insurance• Basic life– Greater of: 1 X your annual base salary or $50,000– Can limit to $50,000 to avoid imputed income– 100% company-paid• Optional life– You may choose to purchase additional coverage foryourself, your spouse/domestic partner, and your children• Employee: 1, 2, 3, 4, 5, 6, 7, or 8 x your base salary,up to $1 million• Spouse/domestic partner: 1, 2, 3, or 4 x your coverageamount, $25,000, $50,000 (up to a maximum of the lesser of 50%of your total coverage — basic and optional — or $500,000)• Child: $10,000, $20,000, or $30,000– You pay for coverage with after-tax payroll deductions27


Evidence of Insurability (EOI) forLife Insurance• No EOI required when you are first eligible, unlessyou:– Select optional employee life insurance coveragegreater than 5 x annual base pay or more than$600,000– Select optional spouse coverage greater than$50,000• If you are required to submit EOI, your additionalcoverage will not go into effect until the EOI isapproved28


Accidental Death andDismemberment (AD&D) Insurance• Basic AD&D– Greater of $50,000 or 1 x your annual base salary– 100% company-paid• Optional AD&D– Employee only• You may purchase coverage from 1 up to 10 x your annual basesalary, up to a maximum of $1 million– Employee + family• You may purchase coverage from 1 up to 10 x your annual basesalary, up to a maximum of $1 million• Family coverage amounts vary depending on who’s covered– You pay for coverage with after-tax payroll deductions29


Beneficiary Designations• You must select a beneficiary for your basic lifeand AD&D insurance, even if you do not electoptional coverage• Electing a beneficiary is easy and important– You can review and update your beneficiarydesignations on My Benefits Access available throughBenefits OnLine– If you do not have online access, you can designateyour beneficiary by calling the NGBC30


Group LegalLegal Resources• Two plan options — Comprehensive and Basic• Both plans provide coverage for legal services,such as:– Legal telephone advice and consultations– Document review– Debt collection– Will preparation– Estate advice31


Northrop Grumman Savings Plan


Northrop Grumman Savings Plan —Employee Contributions• You may contribute between 1%and 75% of eligible compensationin 1% increments• Tax-deferred , Roth 401(k) and/orafter-tax contributions• Age 50 catch-up contributions• If you are considered a highlycompensated employee, yourcontributions may be limited in asubsequent yearInvestment options• Retirement Path Portfolios• Core investment funds• Schwab Personal ChoiceRetirement Account®33


Northrop Grumman Savings Plan —FeaturesLoans• Up to two loans at one time• Maximum of $50,000Payment OptionsOther features• Partial distributions• Total lump sum• Company match (dependingon business unit)• 100% immediate vesting incompany-matching andbasic contributions• Daily valuation34


2010 Savings Contribution LimitsYour Tax-Deferredand/or Roth 401(k)Contribution LimitIf you are UnderAge 50Maximum of $16,500*If you are age50 or olderAdditional $5,500 incatch-up contributions,for a maximum of up to$22,000Limit on TotalContributions (yourcontributions plusNorthrop Grumman’scontributions)100% of annual pay or$49,000 or whichever isless100% of annual pay or$54,500 ($49,000 +$5,500 in catch-upcontributions),whichever is less* You must be at least 50 years old by the end of 2010 to beeligible to make catch-up contributions in 2010.35


Savings Plan Investment LineupTwo “paths” to retirement1 2Let an investmentprofessional do thework with aRetirement PathPortfolioThe SavingsPlan’s coreinvestmentfundsBuild and monitor yourown portfolio with…Stocks, bonds andmutual fundsusing SchwabPCRA36


Path 1 ─ Retirement Path Portfolios• Five investment options– Target Retirement Path– 2020 Retirement Path– 2030 Retirement Path– 2040 Retirement Path– 2050 Retirement PathFor participants who are retiredor approaching retirementFor participants who arebeginning their careers• You select a portfolio based on your expectedretirement date (typically age 65)• Each portfolio is well diversified and designed to meetyour investment goals prior to and beyond retirement• As you get closer to your expected retirement date, theinvestment manager adjusts the portfolio mix tomaximize return for the level of risk appropriateat each life stage37


Path 2 – Build and Monitor Your OwnPortfolio• Core Investment Funds– Stable Value Fund– U.S. Fixed Income Fund– Balanced Fund– U.S. Equity Fund– International Equity Fund– Small Cap Fund– Emerging Markets Equity Fund– Northrop Grumman Fund• Schwab PersonalChoice RetirementAccount® (PCRA)– Self-directedbrokerage account– Invest among aselection of more than3,200 mutual fundsand individualsecurities (e.g., stocksand bonds)38


Automatic Enrollment• If you have not enrolled in the Northrop Grumman SavingsPlan within approximately 45 days of your date of hire, you willbe automatically enrolled at a contribution rate of 2%• Your contributions will be deducted on a tax-deferred basis andinvested in the Retirement Path portfolio that most closelytargets the year in which you will attain age 65• After you are enrolled, you may change your contribution rateand investment choices at any time• If you do not want to enroll at this time, log on to My BenefitsAccess or call the Northrop Grumman Benefits Center todecline enrollment• By declining, you may miss the benefit of receiving companymatching contributions (if applicable)39


Quick Enrollment - Process• Default contribution will be set at the rate to maximizeany company match for which you might be eligible• You can change your contribution rate any time• Optional automatic escalation of 1% per year alsoprovided• Retirement Path portfolio will be default investmentoption• My Benefits Access Website will offer a choice to useQuick Enrollment or the regular process– If Quick Enrollment is selected, you will be presented witha default contribution rate and investment election– You can accept or change the defaulted investmentelection40


Enrolling in Your Benefits


Enrolling is Easy• Go to Benefits OnLine at http://benefits.northropgrumman.comand click on the “New Hire Enrollment” link• Review highlights of the Northrop Grumman Benefits Program andenroll in the Health and Savings Plans• Print a confirmation statement once enrollment has been completedand savedNo Web Access?• Call the Northrop Grumman Benefits Center (NGBC) at1-800-894-4194 Monday through Friday, 9:00 a.m. to 6:00 p.m.Eastern time• Outside the United States call 718-354-1338• Hearing impaired participants will need to use a relay service throughservice provider.42


Benefits OnLinehttp://benefits.northropgrumman.com43


New Hire Enrollment Page44


My Benefits Access Log On45


My Benefits Access -Registration as a New User46


My Benefits Access – Welcome Screen47


My Benefits Access – Enrollment Steps48


My Benefits Access – Enrolling in Your Benefits49


My Benefits Access – Enrolling in Medical Example50


Final Reminders• You must enroll in optional Health Plan benefits if youwant coverage for the benefit plan year– Enroll by the deadline shown on your enrollmentletter (within 31 days of date of hire)– Even if you do not want optional coverage, go onlineor call to elect “no coverage”– If you do not enroll, you will not have optionalbenefits for yourself or your family• Enroll in the Savings Plan– If you do not want to participate, you must declineenrollment• Elect your beneficiaries for basic and optional life andAD&D insurance, and for the Savings Plan51


Questions?52

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