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ORD 34044 - Contract with Blue Cross Blue Shield for administrative services for self-insured health program• w • 1 oM�H� NF of 84'1 Finance Department Omaha/Douglas Civic Center 6047,45 t 1819 Farnam Street,Suite 1004 V1 ! nT ro Omaha,Nebraska 68183-1004 (402)444-5416 Telefax(402)444-5423 �4?ED FEBRU� Louis A.D'Ercole City of Omaha Acting Director Hal Daub,Mayor October 29, 1996 Honorable President and Members of the City Council, The attached Ordinance authorizes the City of Omaha to enter into a three year agreement with Blue Cross/Blue Shield of Nebraska to process the City's health insurance claims,provide pre-certification services,provide a Preferred Provider Organization(PPO)and provide insurance for specified organ transplant surgeries. The City retained Insurance Consultants, Inc. to assist in both developing the health insurance bid specifications and evaluating the responses and recommending the lowest and best bid for the City. The City received two proposals from Blue Cross/Blue Shield of Nebraska and Mutual of Omaha which were deemed to be consistent with the specifications. The contractor has on file a current Annual Contract Compliance Report Form(CC-1). As is City policy, the Human Relations Director will review the contractor to ensure compliance with the Contract Compliance Ordinance. Insurance Consultants Inc. evaluated the proposals and recommended that the City award the contract to Blue Cross/Blue Shield. The major reasons for this recommendation may briefly be summarized as: • The lower administration charge. • The broader managed care network • The ability to guarantee claim dollar savings • Experience in providing services to the City of Omaha 1410( 1 5 Honorable President and Members of the City Council Page 2 The City Departments of Finance, Law and Personnel have reviewed the bid specifications, proposals, and the consultants' recommendation and concur with the Blue Cross/Blue Shield recommendation. Attached are reports by Insurance Consultants, Inc. which provide more detail concerning its recommendations. Respectfully submitted, Approved: • 'zk5c&- g S „c-j) Louis A. D'Ercole Mi . Frost Acting Finance Director Personnel Director Approved: Approved: Herbe M. Fitle Georg�avis, Jr. City Attorney Acting Human Relations Director Referred to city Council for Consideration: 4...Z..._,I . Mayor's Office/Title na...) P:\LAW\2600.PJM 1113( J • ORDINANCE NO. 1/Q y� • AN ORDINANCE to approve and execute a contract involving the payment of money from appropriations of more than one year in accordance with section 5.17 of the Home Rule Charter of the City of Omaha, 1956, as amended, by and between the City of Omaha, a municipal corporation, and Blue Cross Blue Shield of Nebraska, to provide the administrative services for the City's self-insured health program for a period of thirty-six months, commencing on January 1, 1997, and ending December 31, 1999, in accordance with the lowest and best proposal submitted by said Blue Cross Blue Shield of Nebraska; and to provide the effective date hereof. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF OMAHA: Section 1. That authority is hereby given for the execution of a Contract involving the payment of money from appropriations of more than one year in accordance with Section 5.17 of the Home Rule Charter of the City of Omaha, 1956,as amended,by and between the City of Omaha, a municipal corporation,and Blue Cross Blue Shield of Nebraska,for administrative services for the City's self-insured health program including participation in a Preferred Provider Organization plan and continuation of a Prescription Card Program for the period from January 1, 1997, to December 31, 1999, in accordance with the proposal of the said Blue Cross Blue Shield of Nebraska. Section 2. That the Mayor of the City of Omaha be, and he hereby is, authorized and empowered to execute for and on behalf of the City of Omaha,and the City Clerk to attest,a contract authorized and approved in Section 1 hereof, attached hereto and marked Exhibit "A" and by this reference made a part hereof as fully as if set forth herein. ' ,► it ORDINANCE NO. 39,9 W PAGE 2 Section 3. That this ordinance shall be in full force and take fifteen days from and after the date of its passage. INTRODUCED BY COUNCILMEMBER: • APPROVED BY: •YOR OF THE CITY OF OMAHA DA 1 E PASSED NOV 1 9 1996 ATTEST: CIT CLERK O THE CITY OF OMAHA APPROVED AS TO FORM: E UTY CIT TTORNEY P:\LAW\3127.MAF 430 , • EXHIBIT "A" ADMINISTRATIVE SERVICES AGREEMENT THIS AGREEMENT is entered into by and between the City of Omaha, a Municipal Corporation in Douglas County,Nebraska, also referred to as "Plan Administrator," and Blue Cross • and Blue Shield of Nebraska, 7261 Mercy Road, Omaha,Nebraska(the "Company"). RECITALS: WHEREAS,the Plan Administrator is serving as such pursuant to designated health benefit plans known as City of Omaha Group Health Program Schedule of Benefits (the "Plan"), copies of which are attached hereto and marked as Exhibits "B-1" and"B-2",for certain employees("Covered Employees") and/or their dependents, as defined in Exhibits "B-1" and "B-2" as follows: B-1 Base/Major Medical as of December 31, 1993 • Police uniform with pre-certification/and Prescription Card Program • Civilian Bargaining retirees prior to January 1, 1991 • Civilian Management including AEC retirees prior to January 1, 1991 • Police Uniform retirees prior to June 1, 1992 • Police Uniform retirees after June 1, 1992 with pre-certification • Police Uniform retirees after July 1, 1995 with pre-certification/Prescription Card Program • Fire Uniform retirees before March 1, 1991 • Fire Uniform retirees between March 1, 1991 and December 31, 1991 with pre-certification • Police or Fire Management retires before June 1, 1992 B-2 Comprehensive Major Medical with Preferred Provider Organization (PPO) with pre-certification and Prescription Card Program. • Fire Uniform (excluding Prescription Card Program) • Civilian Bargaining • Civilian Management, including AEC • Functional • Civilian Bargaining Retirees after January 1, 1991 with precertification • Civilian Bargaining Retirees after January 1, 1994 with precertification and Prescription Card Program h _ _ • Civilian Management, including AEC retirees after January 1, 1991 with precertification • Civilian Management, including AEC retirees after October 1, 1994 with precertification and Prescription Card Program • Fire Uniform retirees after January 1, 1992 • Functional retirees • Police or Fire Management (exclude Prescription Card Program - Fire) • Police or Fire Management retirees after June 1, 1992 • Police Management retirees after January 1, 1996 with precertification and Prescription Card Program Covered Employees and their dependents shall be referred to in this agreement where appropriate as "Covered Persons"; and, WHEREAS, the City of Omaha continues to extend to covered persons the option of receiving health insurance benefits under a Prescription Card Program which will be administered and maintained by the Company; and, WHEREAS the Company has expertise in various aspects of health plan administration;and, WHEREAS, the Plan Administrator desires to engage the Company to provide certain administrative services for the Plan, and the Company is willing to provide such services; and, WHEREAS,the Plan Administrator desires to engage the company to provide insurance on a shared basis for coverage for specific whole organ transplants, and the Company is willing to provide such services. (Exhibit "C" and "D-1") NOW, THEREFORE, in consideration of the mutual promises and duties set forth in this agreement, the parties hereto, intending to be legally bound, do agree as follows: -2- ARTICLE I ADMINISTRATIVE SERVICES 1.1 The Company shall, at its expense,maintain adequate and necessary records on each Covered Employee for the proper administration of the Plan. The records maintained on each Covered Employee shall include, but are not limited to: (a) Full name; (b) Marital status; (c) Date of birth; (d) Effective date of coverage; (e) Election of dependent coverage and names of dependents; and, (f) Records pertinent to maintenance of coordination of benefits. These records shall be available for inspection by the Plan Administrator during regular business hours. 1.2 The Company shall prepare and issue,through the Plan Administrator,identification cards and if necessary prescriptions cards, and a Plan summary for all Covered Employees. The identification cards including prescription cards shall be evidence of participation in the Plan and shall be presented by the Covered Person to the provider of medical services, supplies or equipment. These cards shall identify the Covered Employee, the Plan, and the Company. 1.3 The Company will provide the Plan Administrator with all of the forms necessary for the enrollment and maintenance of a Covered Person's records and for the Covered Person's submission of claims for benefits. -3- { 1.4 The Company shall, as a part of this agreement, provide a conversion coverage privilege for qualified Covered Employees who terminate employment with the City. Such conversion coverage shall be the same conversion coverage made available for persons who leave groups which are underwritten by the Company. 1.5 The Company will provide the Plan Document and any necessary amendments, revisions, or modifications thereto. The Company will not change any provisions in the Plan Document without prior written approval of the City's authorized representative. The Company will continually advise the Plan Administrator, and in no event on less than a calendar quarterly basis, beginning on April 30, 1997, of cost estimates and projections of the Plan to its best ability in conjunction with its preparation of accounting reports for use by the Plan Administrator. 1.6 The services of the entire organization and personnel of the Company are available for the performance of its duties and responsibilities pursuant to this agreement. ARTICLE II CLAIM SERVICE 2.1 The Company shall review claims which are submitted for services provided to Covered Persons to determine whether benefits are payable under the terms of the Plan. The Company shall conduct such examination as is reasonable to determine whether benefits are payable under the Plan. The Company shall pay or reject no less than 80 percent of the claims received within 7 calendar days and 90 percent of the claims received within 14 calendar days from the date of the receipt of the claim excluding all claims which must be provided for externally obtained information. -4- 2.2 The Company shall make benefit payment from its own funds. Monthly paid claims analysis reports shall be submitted to the Plan Administrator by the Company in the month immediately following payment. The Plan Administrator shall reimburse the Company the amount of these claims by the 15th day of that month if the claims analysis is submitted on or before the 12th day thereof, or if not submitted by the 12th day thereof, then within three working days after submission. It is expressly understood by and between the Company and the Plan Administrator that reimbursement pursuant to this paragraph shall be only in that amount of the claim actually paid by the Company, and in the event discounted rates are paid by the Company as a result of payment pursuant to diagnostic related group agreements (hereinafter DRG),physician service discounts or other provider discounts,then such discounted rates so paid shall be the limit of the City's liability for reimbursement. 2.3 In the event that a claim is not payable,the Company will notify the Covered Person and the Plan Administrator of such decision, including the reason for the denial,which shall include the reference to the applicable provision of the Plan. The Covered Person has the right to appeal such denial, and the Company will reconsider the denial of benefits and advise the Plan Administrator and the Covered Person of its final determination. If the Covered Person requests review of the denial by the Plan Administrator,the Company shall, if requested, make available a qualified and informed agent who shall appear or provide necessary information for said review. 2.4 The Plan Administrator shall have the final authority to authorize or disallow benefit payments. 2.5 The Company shall maintain current, accurate, and complete records and files which allow the Plan Administrator to examine and analyze all claim submissions, health care provider -5- agreements including but not limited to DRG agreements and payments made pursuant to same, including payments on each Covered Person for a period of at least five years after the filing of the claim. The Plan Administrator's authorized representatives shall have the reasonable right of access to, and copies of,the records provided for herein during normal business hours for the purposes of determining compliance with the agreement and performing any necessary audits. For the purpose of conducting audits or requesting information,the Company shall maintain records available to the Plan Administrator which include the amount of the bills received from medical providers, the amount same have been reduced as a result of DRG agreements,physician service discounts or other provider discounts, and the amount of payment made by the Company as a result of any discounted rates resultant from any negotiated agreements. This provision is subject to the understanding of both parties that certain records are of confidential nature, and the release of such information is subject to the provisions of paragraph 2.6. 2.6 The Company will provide the Plan Administrator a monthly claims report of all claims processed during that month. Such report will list: (a) The claimant's name and the agreement number under which the claim has been submitted; (b) Whether the claimant is an employee or a dependent; (c) The claimant's age and sex; (d) The claimant's admission of performance date, and date of discharge; (e) The type of care provided; (f) The amount charged for such care; (g) The amount paid for such care and the amount that same has been reduced by reason of negotiated provider contract between hospitals and medical service providers,and -6- the Company further warrants and guarantees that the amount of savings over the term of this agreement from January 1, 1997, through and including December 31, 1999, resultant from said negotiated provider agreements shall be no less than $5,000,000. In the event the actual savings is less than$5,000,000 the company will issue a credit for the difference between the actual savings amount and the guaranteed savings amount. If the actual savings is greater than $5,000,000 the company will have fulfilled the savings guarantee; (h) The difference, if any, between the amount charged and the amount paid because of any negotiated provider contracts; (i) The amount of any benefits credits. (j) The amount of any subrogation claim as defined by Article IX (B-1) of Part XVI (B-2),of the Master Group Contracts and the amount recovered by the Company in satisfaction of that subrogation claim. It is understood that any subrogation claim for which recovery has been successful shall be credited to the City, and that said recovery shall constitute a savings to the City of Omaha. In the event the Company does not pursue a subrogation claim which it is aware of, the Company shall advise the City of the amount of said claim and the reason that recovery is not being pursued. Additionally it is understood and agreed that any money recovered as a subrogation claim shall not be considered part of or included in the savings computed and guaranteed pursuant to the terms of paragraph 2.6(g). This report will be mailed or delivered to the Plan Administrator within a reasonable time following the close of the period covered by the report. No employee-specific information regarding diagnosis and medical history will be released without a written request from the Plan Administrator for such information. All Claim reviews by the Plan Administrator will be conducted in such manner as to maintain the information provided concerning the Covered Person confidentially. Plan Administrator agrees that health care provider agreements are proprietary to the Company and that the Plan Administrator agrees that the contents will not be released or provided to any individuals, companies or firms absent judicial process. -7- e • • The Plan Administrator further agrees to indemnify and hold harmless the Company from any and all claims, demands, actions, or causes of action arising as a result of the release of information by the Company to the Plan Administrator. 2.7 The Company shall provide the following at the frequency designated: 1. Hospital Utilization by Diagnostic Category -- Semiannually. 2. Utilization Report by Procedure Code -- Quarterly. 3. Utilization Report not Defined by Procedure Codes -- Quarterly. 4. In-patient Experience by Hospital -- Quarterly. 5. Cost Savings Report-- Monthly. 6. Members with Claims Totaling $10,000 or More -- Monthly. 7. Group Experience Report-- Monthly. 8. Total Experience by Age and Sex--Annually. 9. A Turn Around Report which would show the Claim Turn Around Time --Monthly. 10. A Customer Service Inquiry Report which would show the Types of Inquiries being asked by Employees -- Monthly. 11. A Claim Lag Report-- Semiannually. 12. Utilization of Prescription Card Report- Quarterly. 2.8 The Claims services listed in this Article II are not intended to limit the claim services provided by the Company and may be expanded as is advisable for the proper administration of the Plan. 2.9 The Company will provide to the Plan Administrator notice of irregularities in claims submissions which result in, or would result in, overpayment of benefits, and which have been -8- f 4 1 1 I } confirmed by the Company's investigation. Such irregularities shall include but not be limited to claims submitted with altered charges or service information and claims for services which were not provided. ARTICLE III ADDITIONAL SERVICES 3.1 The Company, within the scope of its professional ability, shall provide consulting services to the Plan Administrator for plan design, actuarial analysis, and administration of the Plan as may be required or advisable. 3.2 In accordance with the Plan Administrator's instructions,the Company shall solicit, collect and compile information or data pertaining to potential plan changes. This section may be considered and utilized as additional services when the performance of the Company hereunder is not within the scope of the duties and responsibilities of the Company as set forth more specifically in any other provisions, and the Company may make such additional services the subject of a claim for reimbursement for the expenses so incurred, if prior to incurring those expenses, the Company has advised the City that such services will be an additional expense. 3.3 The Company shall incorporate and/or administer any change to the health insurance plan,when notified directly by the Plan Administrator, for various classes of employees and shall, to every extent reasonable and practicable, administer those changes in the health insurance benefits incorporated into the current labor agreements or understanding between the City of Omaha and its participating employees. It is expressly understood that the Company has no authority to unilaterally or independently make any change in the benefits or methods of processing same without the express prior written approval of the Plan Administrator. -9- 3.4 The Company shall provide personnel to assist in orientation and training concerning the benefits provided under this Plan. ARTICLE IV ADMINISTRATOR'S RESPONSIBILITIES 4.1 The Plan Administrator shall provide the Company with the necessary enrollment records of the Covered Employees as of the effective date of this agreement. Thereafter, the Plan Administrator shall notify the Company of all changes by reason of termination,changes,or addition of new Covered Employees. The Company shall not be liable for any action it has taken on behalf of a Covered Person prior to its receipt of information that would have caused a different decision. 4.2 The Plan Administrator shall provide the Company with a true and accurate accounting of all Covered Persons. The Company shall not be liable for any loss incurred as a result of any inaccurate accounting of Covered Persons on the part of the Plan Administrator. 4.3 The Plan Administrator shall maintain a supply of forms, which are available from the Company,and shall distribute or make available such forms to Covered Employees for the filing of claims for benefits or to report changes in participation, when the form is not available by the provider. 4.4 Except as provided in Section 1.5., the Plan Administrator shall provide to the Company all materials, documents, and information as may be necessary for the operation of the Plan, or to satisfy the requirements of governing law. 4.5 The Plan Administrator shall be responsible for satisfying any and all reporting and disclosure requirements imposed on the Plan under applicable law. The Company will assist with such requirements and provide the documents and materials necessary upon request. -10- 4.6 The Plan Administrator shall be responsible for any delay in the performance of the administrative and claims service caused by the failure of the Plan Administrator to promptly furnish notice of enrollment and/or termination of employees to the Company. ARTICLE V Preferred Provider Organizations (hereinafter P.P.O.) and Optional Prescription Card Program. The company shall administer a P.P.O.Program and a Prescription Card Program for covered persons pursuant to the following conditions and understandings: 5.1 At mutually agreed times covered employees may,at their option,elect to participate in a Prescription Card Program. The Company shall provide such forms as are necessary to document the employee's election to have coverage provided under the terms and conditions of the City's Prescription Card Program. That Program shall include the following: (1) Each covered employee will be issued a "prescription card" which will allow the covered employee or covered family member(s)to purchase prescriptions by paying, at the time and site of purchase, 20% of the cost of each prescription after the applicable yearly deductible has been satisfied. (2) The yearly deductible shall be $60.00 for single or family. The prescription deductible and co-payment are separate and distinct from the health insurance deductible and co-payment, except prescriptions dispensed in the hospital, shall be applied to the health insurance deductible and co-payment. (3) The prescription card will be valid at the majority of pharmacies in the Omaha area; however, it is understood that some small pharmacies may not participate. In order to be covered for in-City charges, employee must use participating pharmacy. (4) After a covered employee has expended$500 after payment of deductible (i.e., 20% of$2,500 post-deductible prescription expenses) in a given calendar year, the card will allow covered employees to obtain prescriptions at a flat rate of $3.00 per prescription. -11- (5) Covered persons who require medications(s) for a period of time in excess of thirty days may be required to purchase such medications from a designated dispensary through the U.S. mail. 5.2 The Company shall provide a list of all pharmacies participating in the Prescription Card Program. 5.3 The Company shall provide to the covered employees a list of all hospitals and physicians located or practicing within the appropriate service area who are participants in the company's P.P.O. Program. 5.4 There shall be no waiting or probationary period for any covered person to qualify under the P.P.O. program and the Prescription Card program, if at the time this contract is approved and signed by the City, the health insurance program in effect at that time would consider the employee or family to be covered persons under that current health insurance plan. 5.5 The Company shall be responsible for monitoring and assuring the quality of care provided by P.P.O. providers. This shall include the following: (a) Education and Credentials; (b) Office Facility; (c) Adequacy of Medical Records; (d) Generic Process Screens; (e) Diagnostic Specific Provisions of Care; (f) Outcome review; (g) Patient Satisfaction Surveys; -12- 0 1 • 5.6 The P.P.O.Plan Document and Prescription Card program shall generally be followed unless there are conflicts with any labor agreements, or ordinances which may be contrary to its provisions. A copy of said PPO plan document is attached hereto marked Exhibit "B-2" and incorporated herein by reference. ARTICLE VI. FEES 6.1 For either the Administrative Services portion of the agreement; the in-hospital Pre-certification or the Whole Organ Transplant Coverage. The Plan Administrator agrees to pay the Company the fees set forth in Exhibit "C". 6.2 Nothing in this Article VI or Exhibit"C" shall prohibit the Company from performing any service not enumerated in this agreement for a reasonable fee. Any such service and corresponding fee may be provided only if agreed to by the Plan Administrator and the Company in advance of such performance. 6.3 If the Plan Administrator, for any reason within its control, fails to make a required payment on a timely basis,the Company may suspend the performance of its services until such time as the Plan Administrator makes the proper remittance. The Company shall provide the Plan Administrator within 15 calendar days, notice of its intent to take such action. 6.4 The Plan Administrator agrees to pay the Company the percentage of claims set forth in Exhibit "C" for paying claims run out after January 1,2000, should the City of Omaha change the company providing administrative service. The claims run out will be only for those claims incurred prior to January 1, 2000, but not yet processed as of December 31, 1999. Such claim run out will be allowed only through March 31, 2000. -13- ARTICLE VII MISCELLANEOUS PROVISIONS 7.1 In no instance shall the Company be deemed the Administrator of the Plan,as defined in Section 3(16) of the Employee Retirement Income Security Act of 1974, as amended, or for purposes of any other applicable state or local law affecting or regulating the Plan. 7.2 The Company shall not be considered the insurer or underwriter of the liability of the Plan Administrator to provide benefits for Covered Persons. The Plan Administrator shall have the final responsibility and liability for payment of claims under the Plan. The Plan Administrator shall be responsible for all expenses incident to the operation of the Plan. ARTICLE VIII AMENDMENTS 8.1 This agreement may be amended by the Plan Administrator or the Company at any time by mutual written consent of each party; provided, however, this agreement may not be amended to reduce any benefits which might be paid for any cause incurred prior to the amendment, or to in any way prejudice such a claim. ARTICLE VIX DURATION OF THIS AGREEMENT 9.1 This agreement shall take effect as of 12:01 a.m., January 1, 1997, and expire December 31, 1999; at 12:00 midnight. This agreement shall automatically be renewed for a period of 60 days until terminated in writing by either party. 9.2 This agreement shall be construed and enforced according to the laws of the State of Nebraska. -14- ARTICLE X TERMINATION OF THIS AGREEMENT 10.1 This agreement may be terminated by either party by written notice to the other party, to be effective as of the date set forth in said notice; provided that such date shall not be less than thirty (30) days from the date of receipt of such notice unless mutually agreeable to both parties. 10.2 This agreement shall automatically terminate in the event of: (a) The Plan Administrator's failure to pay the fees provided in Exhibit "C" within thirty (30) days of their due date; (b) The Plan Administrator's failure to reimburse the Company for benefit payment as required by paragraph 2.2. (c) Adjudicated bankruptcy or insolvency of Blue Cross and Blue Shield of Nebraska; (d) Failure of the Plan Administrator to promptly deliver any data specified herein which is necessary for the proper performance of duties; (e) The enactment of any law or regulation which makes illegal the continuance of this agreement. 10.3 In the event of termination of this agreement, the Company shall complete the processing of all requests for claim payments under the Plan which were received by it and are due and payable prior to the termination of this agreement. The Company shall have no obligation to pay or process claims relative to services provided for conditions existing on or after the termination of this agreement. 10.4 The Company shall return to the Plan Administrator all claims which were incurred p Y and received by them after the date of termination established herein. 10.5 The Company shall,within 60 days of the last transaction required under this Article IX, deliver to the Plan Administrator a complete and final accounting and report of the financial -15- status of the Plan,together with copies of all books and records in its possession with respect to the Plan, all claims files, and all reports and other papers pertaining to the Plan. The Company retains the right to keep originals of all documents. ARTICLE XI EQUAL EMPLOYMENT OPPORTUNITY CLAUSE 11.1 Annexed hereto as Exhibit "D" and made a part hereof by reference are the equal employment provisions of this agreement. Refusal by the Company to comply with any portion of this program, as therein stated and described, will subject the offending party to any or all of the following penalties: (a) Withholding of all future payments under the involved contracts to the Company in violation until it is determined that the Company is in compliance with the provisions of the contract; (b) Refusal of all future bids for any contracts with the Plan Administrator or any of its departments or divisions until such time as the Company demonstrates that it has established and shall carry out the policies of the program as herein outlined. ARTICLE XII NONDISCRIMINATION 12.1 The Company shall not, in the performance of this agreement,discriminate or permit discrimination in violation of federal or state laws or local ordinances, because of race, color, sex, age, political or religious opinions, affiliations or national origin. ARTICLE XIII INTEREST OF THE PLAN ADMINISTRATOR 13.1 Pursuant to Section 8.05 of the Home Rule Charter,no elected official or any officer or employee of the City shall have a financial interest, direct or indirect, in any City contract. Any -16- violation of this section,with the knowledge of the person or corporation contracting with the City, shall render the contract voidable by the Mayor or Council. ARTICLE XIV INTEREST OF BLUE CROSS AND BLUE SHIELD OF NEBRASKA 14.1 The Company covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict with the performance of services required to be performed under this agreement; it further covenants that in the performance of this agreement, no person having any such interest shall be employed. ARTICLE XV - MODIFICATION 15.1 This agreement contains the entire agreement of the parties. No representations were made or relied upon by either party other than those that are expressly set forth herein. No agent, employee or other representative of either party is empowered to alter any of the terms hereof unless done in writing or signed by an authorized officer of the respective parties. 15.2 In the event the Plan administrator determines that benefits as recited in Exhibit "B" are to be modified,then it shall notify the Company at least 30 days prior to the implementation of said modification in benefits. It shall be the responsibility of the Company to continue to administer the modified benefits consistent with the fee schedules recited in Exhibit "C". ARTICLE XVI ADDITIONAL FEES OR OTHER TAXES 16.1 If,during the term of this agreement,any tax(other than local, state or federal income taxes) or any other assessment or premium charge, shall be assessed against the Company with -17- r • respect to this agreement,the Company shall report the payment to the Plan Administrator, and the Plan Administrator shall reimburse the Company for the same. ARTICLE XVII AUTHORIZED REPRESENTATIVE In further consideration of the mutual covenants herein contained,the parties hereto expressly agree that for purposes of notice, including legal service of process, during the term of this contract and for the period of any applicable statute of limitations thereafter,the following named individuals shall be the authorized representatives of the parties: (1) City of Omaha Louis A. D'Ercole, Acting-Finance Director Omaha/Douglas Civic Center 1819 Farnam Street Omaha,NE 68183 (2) Blue Cross and Blue Shield of Nebraska Jerry Dworak, Vice President 7261 Mercy Road Omaha,NE 68180 EXECUTED THIS day of(Oa—, 1996. BLUE CROSS AND BLUE SHIELD ATTEST: OF NEBRASKA 44/09.Lfr..ot/ / J By Ls- -18- EXECUTED THIS2A lay of.. , 1996. CITY OF OMAHA, a Municipal ATTEST:_ Corporation . _,ZdedL.14------- By Or / ,6661,.,_ `, t Clerk, City of Omaha Ma •r, City of Omaha APPROVED AS TO FORM: 2 Z-,7---:L — Deputy City orney 4836v -19- ,,,77 0 J • EXHIBIT "B-1" GROUP MASTER CONTRACT between BLUE CROSS AND BLUE SHIELD OF NEBRASKA A Nebraska Non-Profit Corporation,with its Home Office at 7261 Mercy Road,Omaha, Nebraska 68124 Herein called the Company and • the Applicant named in the Application herefor, Herein called the Applicant • Effective beginning at 12:01 A.M. at the Applicant's principal place of business on the date stated in the Application. In consideration of the Application for this Contract, a copy of which Application is attached hereto and made a part of this Contract, and in accordance with the payment by the Applicant of the charges as herein provided,THE COMPANY HEREBY AGREES TO PROVIDE PAYMENT for the services described, defined and limited herein, effective as stated and from year to year thereafter,unless this Contract is terminated as provided herein. This Contract is executed and delivered in the State of Nebraska,and is governed by the laws thereof. Group— UCR 9711 1-80 r O •,(,.T•:A:T�SR/�.a?¢�aM•�-.�+•.. .+ati+w.a• t�.�+u..r.-n4nc�t+d.zr�rr++:=�otere?giF 1' - ia .. I� :6 �'l • ..F_i. '�� .r�F�.b::^:Mi{.rJ1°il.�r,f,.r.?;.:• a s'‘ • { r TABLE OF CONTENTS PAGE Article I. Definitions 2 Article II. Exclusions and Limitations 5 Article III. Standard Provisions 7 Article IV. Charges For Coverage 8 Article V. Nonpayment, Reinstatement, Termination, Cancellation, Conversion 9 Article VI. Subscriber's Record,Certificate and Identification Card i0 Article VII. Eligibility, Election of Coverage, Effective Date of Coverage, Extension of Coverage, Waiting Periods -10 Article VII I. Payment For Services 12 Article IX. Subrogation 12 Article X. Coordination of Benefits 13 Article XI. Additional Provisions 14 Article XII. Basic Coverage For Hospital Services Except Pregnancy 14 Article XIII. Basic Coverage For Doctor's Services Except Pregnancy 15 Article XIV. Pregnancy 17 Article XV. Oral Surgery 18 Article XVI. Mental and Nervous Illness,Drug Addiction and Alcoholism 19 Article XVII. Major Medical Benefits 19 Article XVIII. Outpatient and Doctor's Office Radiology and Pathology Services 22 Group-- UCR 1 • ARTICLE I. DEFINITIONS A. RELATING TO THIS AGREEMENT: 1. Benefit Period: A continuous period of Hospital confinement as an Inpatient,or sucessive periods of Hospital confinement as an Inpatient when the last day of discharge and the following date of admission are separated by less than sixty (60) consecutive days. When at least sixty (60) consecutive days separate the date of the last discharge from any Hospital and the next date of admission to any Hospital, another Benefit Period shall be available. In determining a Benefit Period for the purposes of this Contract, the day of admission shall be counted, but the day of discharge shall not be counted. 2. Certificate: A form which is not a part of this Contract, issued to the Subscriber which summarizes benefits, limitations,exclusions,waiting periods,and other information concerning coverage of this Contract. 3. Coinsurance: The percentage of an approved charge for covered services which is the Subscriber's responsibility to pay. 4. Contract: This agreement between the Company and the Applicant, including any attached endorsements, the application of the Applicant,and the individual applications of the Subscribers. 5. Contract Year: The twelve (12) consecutive calendar months commencing with the original effective date of this Contract,and each twelve (12) consecutive months thereafter during the life of this Contract. 6. Covered Services: Care,treatment,facilities, and supplies for which payment is provided for by this Contract. 7. Identification Card: A card issued to a Subscriber, bearing the Subscriber's name and other information con- cerning coverage provided by this Contract. 8. Medicare: Benefits provided under the Health Insurance for the Aged Act,Title XVIII of the Social Security Amendment of 1965 as then constituted or later amended. 9. Membership Year: The twelve (12) consecutive months commencing with the original effective date of coverage of the Subscriber with the Company, and each twelve (12) consecutive months thereafter during the Subscriber's continuous membership,whether under this or some other Contract with the Company. 10. New Plan: A Membership Agreement to which conversion is offered by this Contract or may otherwise be permitted by the Company. 11. Schedule of Benefits: A form,which is not a part of this Contract,issued to the Subscriber which summarizes benefits,applicable time periods,and other information concerning coverage of this Contract, 12. Usual, Customary and Reasonable Fees: • a; tIsuat=Fee:-The-fee commonly-charged fora given service by an individual Doctor in his personal practice: b. Customary Fee: The ninetieth (90th) percentile of charges by Doctors of similar training and experience for the same service within a specific geographic or socioeconomic area. 'e. Reasonable Fee: A fee which meets the-Usual•and Customary criteria, or is justifiable in the special circumstances of the particular service in question. 13. Waiting Period: A specified number of days during which benefits are not provided for certain conditions under this Contract. B. RELATING TO INDIVIDUALS COVERED: 1. Covered Person: A Subscriber or Eligible Dependent of a Subscriber who has a family membership. Group— UCR 2 2. Eligible Dependent: a. The Subscriber's spouse unless they are legally and effectively divorced or separated, or their marriage has been legally and effectively dissolved; b. The Subscriber's unmarried children under nineteen (19) years of age who are chiefly dependent upon the Subscriber for support and maintenance; (1) A child is "chiefly dependent upon the Subscriber for support and maintenance"if,and so long as, the Subscriber provides more than one-half of the support of such child as support is determined under the Internal Revenue Code of the United States. Children includes step-children,legally adopted children, and grandchildren who live with the Subscriber in a regular child-parent relationship, but not foster children. (2) Attainment of age nineteen (19) while such child is a Covered Person shall not terminate the coverage of the child during the continuance of this Contract while the child is and continues to be both (a) incapable of self-sustaining employment by reason of mental or physical handicap based upon standards and criteria on file with the Department of Insurance of the State of Nebraska and (b) chiefly dependent upon the Subscriber for support and maintenance,if proof of such incapacity and dependency is furnished to the Company by the Subscriber within thirty-one (31) days of the child's attainment of age nineteen (19) and subsequently as may be required by the Company but not more frequently than annually after the two (2) year period following the child's attainment of age nineteen (19). c. The Subscriber's unmarried•children under twenty-four (24) years of age who are chiefly dependent upon the Subscriber for support and maintenance and who are not regularly employed thirty (30) or more hours per week and are in regular,full-time attendance at an educational institution which maintains a faculty and curriculum and has a regularly organized body of students in attendance. 3. Family Membership: Provides coverage for the Subscriber and all Eligible Dependents of the Subscriber. 4. One-Person Membership: Provides coverage for only the Subscriber. 5. Subscriber: Any person who is eligible for coverage as stated in the application for this Contract and has been so designated to the Company by the Applicant,and who is named on an Identification Card issued by the Company pursuant to this Contract. C. RELATING TO TYPES OF CARE AND PHYSICAL CONDITION: 0 t`) � 1. Cosmetic Surgery: Surgery which can be expected to improve the physical appearance of an individual but ��c�.,r Jwhich does not restore or materially improve a bodily function. • "`� 2. Custodial/Domiciliary Care: Care provided to a patient (1) who is mentally or physically disabled and such disability is expected to continue and be prolonged, and (2) who requires a protected, monitored and/or controlled environment whether in an institution or in the home, and (3) who requires assistance to support the essentials of daily living, and (4) who is not under active and specific medical, surgical and/or psychiatric treatment which will reduce the disability to the extent necessary to enable the patient to function outside the protected, monitored and/or controlled environment. A custodial care determination is not precluded by the fact that a patient is under the care of a supervising and/or attending physician and that services are being ordered and prescribed to support and generally maintain the patient's condition, and/or provide for the patient's comfort,and/or assure the manageability of the patient. Further,a custodial care determination is not precluded because the ordered and prescribed services and supplies are being administered by a Registered Nurse or Licensed Practical Nurse. 3. Experimental Treatment: Medical care, drugs, or medicine that is essentially investigatory or unproven and usually provided under controlled medicolegal conditions which does not meet the generally accepted standards of usual professional medical practice in the general medical community. 4. Illness: Bodily disorder or disease. Group- UCR 3 5. Injury: Accidental physical harm. 6. Inpatient: A patient who has been admitted to a Hospital for bed occupancy for purposes of receiving necessary medical care, with the reasonable expectation that the patient will remain in the institution at least twenty-four(24) hours and with the registration and assignment of an inpatient number or designation. 7. Medical Emergency: The sudden and unexpected onset of a medical condition or the acute exacerbation of a chronic condition which requires immediate medical treatment and/or which manifests painful symptomatology requiring immediate efforts to alleviate suffering such as; heart attacks, cardiovascular accidents, poisonings, loss of consciousness or respiration,convulsions,and such other serious acute conditions as may be determined to be Medical Emergencies by the Company based upon standards and criteria on file with the Department of Insurance of the State of Nebraska. 8. Medically Necessary: The level of services and supplies i.e., frequency, extent, and kinds, adequate for the diagnosis and treatment of Illness or Injury. 9. Outpatient: An individual treated in the Outpatient Department or Emergency Room of a Hospital. 10. Physical Rehabilitation: Services primarily provided to upgrade the patient's ability to function as independently as possible in the activities of daily living,such as self-sufficiency in bathing,walking,toileting,eating, dressing,and homemaking. 11. Pregnancy: Includes obstetrics, abortions, threatened abortions, miscarriages, premature deliveries, ectopic pregnancies,or other conditions or complications caused by or arising from pregnancy. D. RELATING TO FACILITIES FOR CARE: 1. Contracting Hospital: A Hospital which has contracted with the Company to provide services. 2. Free Standing Ambulatory Facility: A facility for surgical treatment of patients,other than and not connected with, offices of individual or group practice physicians, not licensed as a part of a Hospital, but providing those facilities and degree of care generally found in and required cf licensed Hospitals except non-emergency overnight care,which has contracted with the Company to provide services. 3. Hospital: An institution primarily engaged in providing, for compensation from Inpatients, facilities for the surgical and medical diagnosis, treatment and care of injured and sick persons by or under the supervision of a staff of Physicians licensed to practice medicine and surgery,which provides a twenty-four(24) hour-a-day nursing service by Registered Nurses, and which is not, other than incidentally (1) an institution which has as its primary purposes the furnishing of food, shelter,training,educational or nonmedical personal services(2) a nursing home or a place for rest, the aged, drug addicts, or alcoholics or(3) a place for the treatment of mental disorder or for mental or physical rehabilitation (4) or any other facility,whether operated independently or as part of a'Hospital,which has entered into a written agreement with the Company based upon controlled care criteria and standards on file with the State of Nebraska, Department of Insurance,to,provide specific services under the•provisions of such written agreement. 4. Member Hospital:•Either a Contracting or Participating Hospital. • 5. Non-Member Hospital: A Hospital other than a Contracting or Participating Hospital. 6. Participating Hospital: A Hospital in another state or territory which contracts with a Blue Cross Plan in its area which participates in the National Blue Cross Inter-Plan Service Benefit Bank. E. RELATING TO MEDICAL PERSONNEL: 1. Contracting Doctor: Any Doctor with whom the Company has entered into a written agreement with regard to payment for services covered by this Contract. 2. Doctor: Any Physician or any other duly licensed practitioner of the healing arts to or for whom benefits are required to be paid by the statutes of the State of Nebraska or by direction of the Board of Directors of the Company. Group- UCR 4 • 3. Physician: Any person duly authorized to practice medicine and surgery by the state, territory, province, district,or country where the medical or surgical services are performed. ARTICLE II. EXCLUSIONS AND LIMITATIONS A. No payments shall be made by this Contract except as provided by Article XVII or otherwise stated herein for: 1. Services not specifically provided by this Contract and any endorsements hereto,nor in any amounts in excess of charges for services provided by this Contract and any endorsements. 2. Any services for,or relating to,or which are,any of the following: a. Allergy skin testing and injections except as provided by Article XVII; b. Audiological examinations or hearing aids and their fitting; c. Blood, blood plasma or blood derivatives or blood fractionates,or services by or for blood donors,except administrative charges for blood furnished to a Hospital by the American Red Cross and used for a Covered Person; d. Cosmetic or restorative surgery except that required as a result of an accident occurring aft the effective of coverage; '9� CC S ,N�(�u, ,2.�v b�-<-1- 41 F. o--t C- e. Detection or correction by manual or mechanical means of structural imbalance, distortion, or subluxa- �`"�o( tion in the human body for the purpose of removing nerve interference and the effects thereof where such interference is the result of or related to distortion, misalignment or subluxation of or in the vertebral column; f. Eye refractions,eyeglasses or contact lenses except as provided by Article XVII; g. Hospital or Physician charges for stand-by availability; Yam . h. Immunizations except as provided by Article XVII; i. Personal expenses while hospitalized, such as guest meals,TV rental and barber services; j. Routine or periodic physical examinations; k. Treatment primarily for obesity or for weight reduction,except surgical operations; I. Therapy which is primarily of an occupational, recreational or educational nature, or forms of non- medical self-care or self-help training,and any related diagnostic testing; m. Treatment or removal of corns, callosities, the cutting or trimming of nails. 3. Any service for,or relating to,or which is,any of the following: a. Not considered by the Company, either initially or after a period of convalescence or treatment, to be medically necessary for diagnosis or treatment of an Illness, Injury or Pregnancy,or which is not consistent with the diagnosis or treatment of a condition for which medical care is necessary; b. Not specifically covered but is provided pursuant to accreditation requirements of any Hospital or Hospital staff rules or regulations; Group- UCR 5 • c. Provided by a person, firm or corporation, required by the Nebraska Health Care Certificate of Need Act to have obtained a certificate of need as therein defined, who or which has not in fact obtained such certificate; d. Provided if admission to a Hospital as an Inpatient or continued hospitalization is primarily for any or all of the following: (1) Diagnostic studies, such as radiology, pathology or similar tests, not requiring hospitalization; (2) Physical rehabilitation, except when confined to a Hospital which has specifically contracted with the Company to provide such treatment; (3) Custodial/Domiciliary care. e. Treatment not provided in accordance with accepted professional medical standards in the United States; f. Procedures which have become obsolete unless, in the opinion of the Company, such treatment is justi- fied. A list of such obsolete procedures shall be maintained on file with the State of Nebraska,Department of Insurance. g. Treatment, drugs, medicines and procedures which in the opinion of the Company are experimental_ 4. Services provided to or for: a. Any dependent of a Subscriber who has One-Person Membership; • b. Any dependent who does not meet the definition of an Eligible Dependent of a Subscriber who has Family Membership; • c. Any Covered Person before the effective date of coverage; d. Any Covered Person for any condition, including Pregnancy, for which coverage has not yet become effective because of the waiting periods set forth herein. 5. Interest or sales or other taxes applicable to services for which payment may be made by this Contract. 6. Charges by Hospitals or Doctors for filling out claim forms or furnishing any other information or reports. 7. Charges by Hospitals or Doctors while the patient is temporarily dismissed or released from the Hospital. 8. Services for Illness or Injury either caused directly or indirectly, in whole or in part,by war or any act of war, declared or undeclared,or sustained by a Covered Person while performing military service. _ 9. Services provided a Covered Person in or by a Non-Member Ho spital except as specifically provided for in Article XII (Basi c c Coverage for Hospital g p Services Except Pregnancy) and Article XIV (Pregnancy). 10. A Subscriber or Eligible Dependent with another Blue Cross and Blue Shield Coverage shall be limited to payment for not more than one-hundred percent (100%) of the covered charge with the coverage having the earliest effective date paying first. 11. Services provided in or by (1) a Veterans Administration Hospital or (2) any Non-Member Hospital or other institution which is owned, operated or controlled by the United States,a state,a coup other governmental go rnmental units, subdivisions or districts,hospital authorities,or any agencies thereof. 12. Services provided for any Illness, Injury or Pregnancy if such services are available, in whole or in part, at governmental expense,whether or not the Covered Person elects to receive such benefits,except as follows: Group- UCR 6 • a. With respect to persons who are eligible for benefits under Medicare, whether or not such person is enrolled under Medicare, the obligation of the Company to provide benefits will be reduced under all circum- stances by the amount of payment or benefits such person receives or would have received under Medicare. b. With respect to persons who are eligible for benefits under any other governmental program,whether or not the person is enrolled thereunder, the obligation of the Company to provide benefits will be reduced under all circumstances by the amount of payments a Covered Person is eligible for under the governmental program; and all such payments and benefits shall be charged against the maximum benefit payments as if such benefits had been provided by this Contract, except as otherwise provided by Article X (Coordination of Benefits). 13. Services to the extent they are not payable by this Contract because of the application of Article X (Coord- ination of Benefits). 14. Services for which there is no legal obligation to pay, or for which no charge would be made to the Covered Person if coverage hereunder did not exist. Any charge which exceeds the charge that would have been made if no coverage existed, or any charge made which is normally or customarily furnished without payment shall be treated as a charge for which there is no legal obligation to pay. 15. Services for conditions arising out of and in the course of employment which any employer is required to furnish or make payment for, in whole or in part, under the provisions of any federal, state or other applicable law (commonly called Worker's Compensation Laws), or any similar law which may be made applicable;or such Services, in whole or in part,to which a Covered Person may be entitled by complying with such laws although the Covered Person elects to waive or does not assert his or her rights thereunder;or such services for which a Covered Person has received compensation from any employer or employer's insurer,in the form of a Worker's Compensation settlement or otherwise.• B. Subject to all other conditions of this Contract,limited service is provided for: 1. Oral Surgery (Article XV). 2. Mental and Nervous Illness,Alcoholism,and Drug Addiction (Article XVI). C. For waiting periods,refer to Article VII of this Contract. ARTICLE Ill. STANDARD PROVISIONS A. ENTIRE CONTRACT CHANGES: This Contract constitutes the entire contract of insurance. No change in this Contract shall be valid until approved by an executive officer of the Company and unless such approval be endorsed hereon or attached hereto. Any such valid amendment, however, shall be binding upon all persons covered under this Contract whether they become covered before or after the effective date of the amendment.The Company reserves the right to,and it is agreed that it may,expand the scope of benefits to include payment for newly developed or additional services under such arrangements with the providers of such services as the Company shall determine, if it appears to the Company that such services will result either in containing costs or improving the quality of services received and such expansion of the scope of benefits shall not be considered or construed as an amendment to this Contract. B. CERTAIN DEFENSES: All statements, in the absence of fraud, made by the Applicant or any Subscriber shall be deemed representations and not warranties, and no such statements shall void coverage or reduce benefits hereunder unless contained in the Application as attached hereto or the application of the Subscriber as filed with the Company. C. NOTICE OF CLAIM: Written notice of claim must be given to the Company within thirty (30) days after receipt of services upon which a claim is to be based, or as soon thereafter as is reasonably possible. Notice given by or on behalf of the Subscriber or any Eligible Dependent to the Company at the address stated in Paragraph H below or to any authorized agent of the Company, with information sufficient to identify the Subscriber shall be deemed notice to the Company. Failure to give notice within the time provided shall not invalidate or reduce any claim if it shall be shown not to have been reasonably possible to give such notice and that notice was given as soon as was reasonably possible. Group- UCR 7 D. CLAIM FORMS: The Company, upon receipt of a notice of claim, will furnish to the provider of service or the Subscriber, as may be appropriate, such forms as are usually furnished by it for filing proofs of loss. If such forms are not furnished within fifteen (15) days after the giving of such notice,the Subscriber shall be deemed to have complied with the requirements of this Contract as to proof of loss upon submitting, within the time fixed herein for filing proofs of loss, written proof covering the occurrence,the character and the extent of the loss for which claim is made. E. PROOFS OF LOSS: Written proof of loss must be given to the Company at the address stated in Paragraph H below within ninety (90) days after the date of such loss. Failure to furnish such proof within the time required shall not invalidate nor reduce any claim if it was not reasonably possible to give proof within such time, provided such proof is furnished as soon as reasonably possible and in any event, except in the absence of legal capacity, within one (1) year from the time proof is otherwise required. F. TIME OF PAYMENT OF CLAIMS: All money payable by this Contract shall be paid immediately upon receipt of.due written proof of such loss. G. LEGAL ACTIONS: No action at law or in equity shall be brought to recover on this Contract prior to the expiration of sixty (60) days after written proof of loss has been furnished in accordance with the requirements of this Contract. No such action shall be brought after the expiration of three (3) years after the time written proof of loss is required to be furnished. H. ADDRESSES FOR NOTICE: Any notice given under this Contract shall be sufficient if given to the Applicaa when addressed to it at the office(s) stated in the attached application; if given to the Company,when addressed to it at 7261 Mercy Road, Omaha, Nebraska 68124;if given to the.Subscriber when addressed to the Subscriber at the Subscriber's most recent address as it appears on the records of the Company. I. CHANGE OF OCCUPATION: No reduction shall be made in any coverage herein provided by reason of any change in the occupation of the Subscriber or any Eligible Dependent, except under the provisions of this Contract relating to the attendance of the Subscriber's unmarried children at educational institutions. J. UNPAID PREMIUM: Upon the payment of a claim by this Contract, any premium then due and unpaid or covered by any note or written order may be deducted therefrom. K. CONFORMITY WITH STATUTES: Any provision of this Contract which, on its effective date, is in conflict with the statutes of the State of Nebraska or the laws of the United States of America is hereby amended to conform to the minimum requirements of such statutes. ARTICLE IV. CHARGES FOR COVERAGE A. The charges for this Contract are the sum of the rates for the respective services provided herein. B. The rates shown in the Application shall be used in computing the sum due under this Contract, provided that the Company may,on any of the following dates,establish for any of the services hereunder a new rate upon which further charges shall be computed: (a) on any charge due date after the first Contract Year, provided that the Company notifies the Applicant or its Agent of Record at least thirty (30) days in advance of such charge due date (b)whenever the terms of this Contract are changed. The parties hereto agree that the above-mentioned rates may be changed upon thirty (30) days notice given pursuant to Article III, Paragraph H of this Contract, if in the opinion of the Company,the cost of providing services and the administration thereof so requires. C. The charge shall equal the sum of the applicable monthly rates for all One-Person and Family Memberships to be covered as of the due date unless the parties mutually agree upon some other method of computation. D. Adjustments which involve a refund of charges to the Applicant shall be limited to the period of twelve (12) months immediately preceding the date of receipt by the Company of evidence that such adjustment should be made. E. All charges for this Contract, including any adjustments, are payable by the Applicant on or before their respective due dates specified herein, at the Company's home office in Omaha, Nebraska. The payment of any charges shall not maintain the coverage of this Contract in force beyond the day immediately preceding the next due date, except as otherwise provided herein. Group-UCR 8 - ARTICLE V. NONPAYMENT, REINSTATEMENT,TERMINATION, CANCELLATION, CONVERSION A. A grace period of thirty-one (31) days,without interest,will be allowed for payment of-any charge due after the first charge due date, during which period this Contract shall continue in force if the Applicant pays the past due charges during • said grace period,subject to the other provisions set forth in this Article. B. If the Applicant fails to pay the past due charges during said grace period, this Contract shall terminate as of 12:00 Midnight of the last day for which charges have been paid. C. If any renewal premium is not paid within the time granted for payment,a subsequent acceptance of premium by the Company or by any agent duly authorized by the Company to accept such premium,without requiring in connection there- with an application for reinstatement, shall reinstate the Contract;provided,that if the Company or such agent requires an application for reinstatement and issues a conditional receipt for the premium tendered, the coverage will be reinstated upon approval of such application by the Company or, lacking such approval, upon the forty-fifth (45) day following the date of such conditional receipt unless the Company has previously notifed the Applicant or Subscriber,as the case may be, in writing of its disapproval of such application. The reinstated coverage shall include only loss resulting from such injury as may be sustained after the date of reinstatement and loss due to such illness as may begin more than ten (10) days after such date. In all other respects,the parties shall have•the same rights hereunder as they had immediately before the due date of the defaulted premium,subject to any provisions endorsed hereon or attached hereto. D. If this Contract terminates for any reason, payments shall not be made under this Contract for any services provided on or after the effective date of such termination,including any services provided for Pregnancy. • E. If the Applicant notifies the Company that the coverage of any Subscriber under this Contract is to be terminated or does not remit the required charges for coverage for or on behalf of said Subscriber, the coverage respecting such Subscriber and any Dependents shall terminate automatically at the end of the period for which the charges specified herein shall have been paid by the Applicant for such Subscriber,and no grace period shall apply. F. If coverage terminates for any reason, payments shall not be made for any services provided to or for any formerly covered person on or after the effective date of such termination,including any services provided for Pregnancy. G. No payments shall be made for services provided to or for any person on or after the date such person ceases to be an Eligible Dependent,including services provided for Pregnancy. H. The Company may cancel this Contract at any time by written notice delivered or mailed to the Applicant at the most recent address as it appears on the records of the Company stating when, not less than five (5) days thereafter, such cancellation shall be effective; and after this Contract has been continued beyond its original term, the Applicant may cancel this Contract at any time by written notice delivered or mailed to the Company, effective upon receipt or on such later date as may be specified in such notice. In the event of cancellation,the Company will return promptly the unearned portion of any premium paid,computed pro rata. Cancellation shall be without prejudice to any claim for services provided before the effective date of cancellation. I. If the Applicant cancels or terminates this Contract, or if the Applicant executes a contract with another health care carrier or becomes self-insured,no conversion privileges shall apply except at the option of the Company. • J. If the Applicant notifies the Company that the coverage of any Subscriber covered under this Contract is to be terminated because of the termination of the relationship between the Applicant and the Subscriber,the Company will issue continuous converted coverage to such terminated Subscriber provided such Subscriber makes application for such coverage and makes payment of the initial charges therefor within thirty-one (31) days of the date of termination. K. In the event of the death of a Subscriber leaving a surviving spouse and having a Family Membership,the Company will issue continuous converted coverage to the Eligible Dependents of such Subscriber,provided the surviving spouse makes application for such coverage and makes payment of the initial charges therefor within thirty-one (31) days of the date of the Subscriber's death. L In the event of the death of a Subscriber not leaving a surviving spouse and having a Family Membership, or in the event a child of a Subscriber having a Family Membership ceases to be an Eligible Dependent, the Company will issue Group- UCR 9 . • continuous converted coverage to the child or children of such Subscriber,provided such child or children make application for such coverage and make payment of the initial charges therefor within thirty-one (31) days of the date of the Subscriber's death or the cessation of eligibility,as the case may be. M. If the individual having a conversion privilege hereunder was covered under a Family Membership and would other- wise be eligible for a Family Membership,then conversion may be to either a Family Membership or a One-Person Member- ship as the individual may elect. If the individual having a conversion privilege hereunder was not covered under a Family Membership, then conversion may only be to a One-Person Membership, or to a Family Membership subject to such conditions or waiting periods as the Company may require. N. The New Plan shall be such plan as the Company may offer as appropriate to the situation,to be determined by the Company. O. Benefits provided, persons covered,and all other terms and conditions thereof,including rates,shall be in accordance with the rules of the Company for the New Plan. It is acknowledged that the benefits available in this Contract,particularly in such areas as dental, vision and hearing care, major medical coverage, and other coverages provided by endorsement to this Contract may not be included or may not be as extensive in the New Plan. P. Any waiting period required by the New Plan shall be reduced only by the length of time the individual converting has been continuously covered by the Company. Q. Benefits are not payable under the New Plan until services are provided while covered under the New Plan. However, if hospitalized on the date of change,hospital benefits for that admission will be provided by this Contract. R. Failure to make the application for the New Plan or to make payment of the initial charges therefor,or both,within the time limits fixed above,shall cause all rights and privileges of conversion to lapse. ARTICLE VI. SUBSCRIBER'S RECORD, CERTIFICATE AND IDENTIFICATION CARD A. The Applicant shall provide to the Company such information about eligibility of persons becoming covered,changes in coverage, and termination of coverage, as the Company may require for the administration of this Contract.Such of the Applicant's records as may, in the opinion of the Company,relate to coverage hereunder shall be open to the Company for review at any reasonable time. B. If erroneous information is furnished to the Company which affects the fact or amount of coverage of any Covered Person, the determination of the extent to which such Covered Person is or was covered shall be based upon the correct facts. C. The Company will issue to or for each Subscriber an Identification Card,a Certificate of Coverage and a Schedule of Benefits. ARTICLE VII. ELIGIBILITY, ELECTION OF COVERAGE, EFFECTIVE DATE OF COVERAGE, EXTENSION OF COVERAGE,WAITING PERIODS A. ELIGIBILITY: 1. If the Applicant is, and applies as, an employer, then every employee of the Applicant shall be eligible for coverage under this Contract,subject to any conditions stated in the Application. 2. Otherwise, eligibility for coverage under this Contract is subject to the conditions stated in the Application. 3. Eligibility of dependents is subject to their meeting, and continuing to meet,the definition of Eligible Depend- ent in Article I. B. ELECTION OF COVERAGE: 1. Any individual eligible for coverage may elect a type of membership as provided in the Application by complet- ing and filing with the Applicant an individual application form furnished by the Company or Applicant. Group- UCR 10 • • 2. Any Subscriber may change from one type membership to another by filing with the Applicant a Request For Change Form furnished by the Company or Applicant. C. EFFECTIVE DATE OF COVERAGE: Subject to any probationary period for eligibility in the Application, to the delivery of the completed application form or Request For Coverage Form to the Company by the Applicant,to the passage of any required waiting periods and to paragraph D below coverage hereunder shall commence as follows: 1. For a person eligible on the initial Effective Date of this Contract whose application for coverage is received by the Company on or before that date,coverage shall begin on the initial Effective Date of this Contract. 2. For any person not eligible or who has not elected coverage on the initial Effective Date of this Contract,but eligible thereafter, coverage shall begin on the next monthly due date for the group following receipt of the Subscriber's application by the Company. 3. If a Subscriber changes to Family Membership, coverage of the Subscriber's Eligible Dependents shall begin on the next monthly due date of the group following receipt by the Company of the Request For Change Form,except that a newly-married Subscriber may backdate the Family Membership to the last monthly due date of the group before the marriage if the Request For Change Form is received by the Company within thirty (30) days of the marriage. 4. For newborn children of a Subscriber who had previously elected Family Membership, coverage of Injury or Illness (including the necessary care and treatment of medically diagnosed congenital defects and birth abnormalities) shall begin immediately. 5. Coverage under this Contract for any person confined in a Hospital,convalescent hospital,or place of treatment for drug addiction or mental illness or alcoholism on the effective date, shall not begin until 12:01 A.M. on the day after dismissal therefrom. D. EXTENSION OF COVERAGE: Coverage under this Contract may be extended to individuals not now designated as eligible by the Applicant at such times and upon such terms as may be agreed to between the Applicant and the Company. E. WAITING PERIODS: 1. Subject to any waiver stated in the Application, no payment shall be made under this Contract for a Covered Person for the following conditions or procedures unless the service is provided more than two-hundred seventy (270) days after continuous coverage of the Covered Person: a. Sterilization, tonsillectomy, appendectomy, adenoidectomy, impacted teeth, myringotomy or tympanoplasty; b. Colporrhaphy, colpoplasty, cystocele (repair of anterior vaginal wall), perineorrhaphy, perineoplasty, rectocele (repair of posterior vaginal wall), total or partial salpingectomy, total or partial oophorectomy, hysterectomy,or myomectomy; c. Inguinal, umbilical or femoral hernias, acne, hemorrhoids, varicose veins,duodenal or gastric ulcers, gall bladder disease,including gallstones,medical or surgical treatment of thyroid disease; d. Preexisting conditions,which are defined as: 1) Any Illness or reoccurrence thereof or complications therefrom, whether known or unknown to the Covered Person, which may be considered from a medical standpoint to have been present in any form on or before the Effective Date of coverage, including, but not limited to, any illness, for which medical or surgical treatment or advice was received at any time before the first date of coverage. 2) Any Injury or complications therefrom or reoccurrence thereof, caused by an accident occurring before the first date of coverage. Group-UCR 11 • 3) Pregnancy or any complications therefrom, unless normal childbirth would have occurred after two-hundred seventy (270) days of continuous maternity coverage. e. Congenital anomalies and birth abnormalities,which are defined as conditions existing at or from birth and which are a significant deviation from the common form or norm, including, but not limited to, ear deformities, harelip, birthmarks, webbed fingers or toes, or other conditions which may be reasonably determined by the Company to be congenital anomalies or birth abnormalities, except as coverage is provided under paragraph C.4.,above. • 2. Persons who fail to elect coverage within thirty-one (31) days of eligibility will be required to observe the waiting periods stated above. ARTICLE VIII. PAYMENT FOR SERVICES A. All payments,except those due under Major Medical,for Covered Services provided by Member Hospitals or Contract- ing Doctors shall be made directly to such providers. B. In all other cases, payments shall, at the option of the Company, be made either to the Subscriber or the provider. C. No assignment of any amounts payable under this Contract shall be recognized or accepted by, or binding upon, the Company. • D. The Company shall be entitled to recover payments made by the Company for services not covered by this Contract, to the extent and in the manner provided by law. E. Payment by the Company for services not covered by this Contract shall not make the Company liable for further payment for the same Illness,Injury or Pregnancy not otherwise covered. F. The obligation of the Company to seek recovery of payments from a Covered Person or provider which are, or appear to be in excess of the requirements of this Contract,or otherwise due the Company,shall be limited to reasonable efforts under all the circumstances. Such excess payments not recovered shall be charged as benefits paid under this Contract, and the Company shall be discharged from all liability therefore by the exercise of such reasonable efforts. G. In the event of any dispute with respect to the application or interpretation of any provision of this Contract,the Subscriber may appeal the Company decision by requesting a review by the Claims and Inquiries Division, Nebraska Depart- ment of Insurance, Lincoln,Nebraska 68509. ARTICLE IX. SUBROGATION A. Subrogation is the limited right of the Company to be substituted for a Covered Person or Subscriber with regard to a claim for damages for willfully or negligently caused,injuries. B. If payment is made for a Covered Person under this Contract, the Company, to the extent of such payment,shall be subrogated to all the rights of recovery which the Covered Person or Subscriber or anyone on their behalf may have against any person or organization or any liability insurer except a No-fault Automobile Insurance carrier. C. The Covered Person or Subscriber shall execute and deliver such documents as the Company may require, shall do whatever else is reasonably required to secure such rights to the Company, and shall do nothing after loss to prejudice such rights. Group- UCR 12 410 ARTICLE X. COORDINATION OF BENEFITS A. The purpose of this Article is to coordinate the payment for services under this Contract with the payment for the same services under other health benefits,including No-fault Automobile Insurance coverages,in order to ultimately reduce the cost of the coverage provided by this Contract.Within this Article,the following definitions apply: 1. Health Benefits Insurance: All forms of insurance under which payment is made for hospital,medical,or other health care services and supplies. 2. No-fault Automobile Insurance: Automobile insurance under which benefits are payable by the insurer for the expenses of hospital and medical care of injuries resulting from an automobile accident without regard to whose negligence caused the accident. 3. Health Benefits Coverage: Both Health Benefits and No-fault Automobile Insurance, to the extent Coordin- ation of Benefits as herein provided for is not.prohibited by law. 4. Primary Carrier: The Company, unless one or more other insurers are the Primary Carrier under any of the following rules,in which case the Company shall not be the Primary Carrier: a. In the event benefits are payable under No-fault Automobile Insurance,the no-fault automobile insurer shall be the Primary Carrier if it is obligated to paybenefits for health care without regard to other Health Benefits Coverage. •- b. In the event benefits are payable under any other Health Benefits Coverage which does not provide for Coordination of Benefits,the insurer providing such other Health Benefits Coverage shall be the Primary Carrier. c. Whenever the benefits payable under any other Health Benefits Coverage other than this Contract are determined with regard to the benefits payable under this Contract, then the Primary Carrier shall be the organization which is the only one which satisfies the first one of the following tests by providing Health Benefits Coverage to the Covered Person: (1) as an employee,annuitant,member of an organization or student; (2) as a child or spouse of a male employee,annuitant,member of an organization or student; (3) under coverage by which the Covered Person has been covered the longer period of time. B. The amount of benefits otherwise available to a Covered Person under this Contract shall be limited, if the Covered Person is entitled to benefits under a Health Benefits Coverage other than this Contract and the Company is not the Primary Carrier, to an amount not to exceed the difference between the reasonable charges to or for the Covered Person and the benefits payable by the Primary Carrier. C. The amount of benefits otherwise available to a Covered Person under this Contract shall be limited, if the Covered Person is entitled to benefits under a Health Benefits Coverage other than this Contract whether with the Company or with some other carrier and it cannot be determined whether or not the Company is the Primary Carrier,to an amount not to exceed that amount which is computed by determining the ratio which benefits otherwise available to the Covered Person by this Contract bear to the total benefits available to the Covered Person, and multiplying the amount of reasonable charges to or for the Covered Person by that ratio. D. If the Company is the Primary Carrier,there shall be no reduction of the benefits otherwise available to a Covered Person under this Contract. E. The obligation of the Company to administer this Article is limited to making a reasonable effort to avoid liability as the Primary Carrier in appropriate cases brought to its attention;to making such efforts as it shall determine reasonable to compute the amount payable under any other Health Benefits Coverage;and to making such efforts as it shall determine reasonable to recover any excess payments made by it. Group— UCR 13 F. Whenever payments which should have been made under this Article have been made under any other Health Benefits Coverage, the Company shall have the right, exercisable alone and in its sole discretion,to pay over to any organization making such other payments any amounts it shall reasonably determine to be warranted in order to satisfy the intent of this Article, and amounts so paid shall be deemed to be benefits paid under this Contract and,to the extent of such payments, the Company shall be fully discharged from liability under this Contract. ARTICLE XI. ADDITIONAL PROVISIONS A. Hospitals contracting with the Company have an obligation, under the laws of the State of Nebraska, to provide hospital services in accordance with the provisions of this Contract. It is expressly agreed that the Company does not undertake to furnish covered services, but only to assume on behalf of the Covered Person,the cost thereof,to the extent herein provided. The Company is in no event liable for any act,error,or omission of any Hospital,Doctor or other provider or any agent or employee of any Hospital,Doctor,or other provider. B. Any admission to a Hospital as an Inpatient must be upon order of a Doctor acceptable to the Hospital and all services furnished by a Hospital must be ordered by a Doctor. All services furnished by a Hospital, including emergency room services, are subject to the availability of facilities at the Hospital selected and to its rules and regulations,including those governing as go g admissions well as the type and scope of services furnished by it. C. In consideration of waiving physical examinations of Covered Persons and as a condition precedent to the approval of claims hereunder,the Company shall be entitled to receive,to such extent as may be lawful,from attending or examining Doctors or from Hospitals or others providing-Covered Services hereunder, such information, records and reports relating to attendance to or examination of or treatment provided Covered Persons as may be required for the administration of such claims, provided however,that the Company shall in every case hold such data as confidential. D. The Annual Meeting of Members of the Company is held at its home office in Omaha,Nebraska,at 4:00 P.M. on the second Monday of February of each year. Each Subscriber covered hereunder is a Member of the Company and is entitled to vote on all matters coming before any Annual or Special Meeting of the Company. It is agreed, in the absence of a Subscriber from any such Meeting,that any other Subscriber may be appointed as the Subscriber's proxy provided a written proxy is filed with the Secretary of the Company at least five (5) days before the meeting. In the absence of the Subscriber or his duly filed proxy,the President of the Company, or in the absence of the President,the Treasurer,shall be the proxy of such Subscriber to vote in his place and stead on all matters corning before any such Meeting of the Members.The proxy shall be valid for so long as this Contract remains in force unless the Subscriber shall revoke it at any time befcre its exercise. ARTICLE XII. BASIC COVERAGE FOR HOSPITAL SERVICES EXCEPT PREGNANCY A. INPATIENT SERVICES: 1. Member Hospitals: If, by reason of Illness or Injury a Covered Person is confined as an Inpatient in a Member Hospital, payment will be made to the Member Hospital for services which are billed by the Member Hospital as a regular Hospital service, for not to exceed the number of days per Benefit Period stated in the Application for this Contract as follows: a. The specific amount stated in the Application for this Contract for room and board (which shall include special diet and general nursing service) will be applied to any type of room accommodation not to exceed the actual charge of the Hospital. If the amount stated in the Application is"Semi-Private,"then the Company will pay the amount charged for semi-private, or reasonably medically necessary for intensive or cardiac care and similar type room and board accommodations. When a Covered Person is confined to a private room under "Semi-Private" coverage, the amount payable shall not exceed the average charge for two (2) bed accommoda- tions in the Hospital of confinement, unless the patient is confined to a private (isolation) room to prevent contagion and the Company determines that isolation for that purpose is medically necessary. If confinement is in a Hospital which has all private (one-bed) rooms, the Company will pay ninety percent (90%) of the charge for the private room under"Semi-Private"coverage unless otherwise specified in the agreement between the Company and the Hospital. Group — UCR 14 b. Use of operating,cystoscopic,cast,recovery and other surgical treatment rooms and equipment. c. Anesthetics, inhalation therapy, oxygen, and their administration when performed by a Hospital employee. d. Drugs, intravenous solutions, vaccines, biologicals, and medicines which are prescribed for and admin- istered to the Covered Person while hospitalized. e. Administration of intravenous solutions, blood, blood plasma, blood derivatives, or blood fractionates. f. Supplies, materials and equipment, including dressings, splints and plaster casts, but excluding "take- home"drugs and supplies,and convenience items. g. Radiology and Pathology services when billed by the Hospital. h. Physical or speech therapy when provided by a Certified Physical or Speech Therapist as an employee of the Hospital,if the therapy is related to the primary condition for which the patient is hospitalized. 2. Non-Member Hospitals: Benefits will be provided for up to thirty (30) days for Inpatient care in a Non-Member. Hospital and payment will be made directly to the Subscriber when either of the following conditions apply: a. Emergency admissions until the patient is medically able to be transferred to a Member Hospital wharf a Member Hospital is located within a twenty-five (25) mile radius of the Non-Member Hospital. b. There is no Member Hospital within twenty-five (25) miles of the Non-Member Hospital. B. OUTPATIENT HOSPITAL SERVICES AND FREE STANDING AMBULATORY SERVICES: 1. The actual charge of a Hospital for Outpatient Services or a Free Standing Ambulatory Facility which has contracted with the Company will be paid for the services itemized in Subsections b through g of Part A above provided such services are, in the opinion of the Company, medically necessary for the specific conditions being treated and are provided for: (1) initial treatment of injuries when provided within seventy-two (72) hours of the time of the accident (2) surgary (3) th^_ initial care of a Medical Emergency when provided within twenty-four (24) hours of its onset (4) rabies injections (5) cancer chemotherapy (6) renal dialysis (7) treatment of burns and (8) reapplication or adjustment of casts. 2. Payment will be made for the services itemized in Subsection g of Part A above if provided within ninety-six (96) hours, efore an Inpatient admission for previously scheduled surgery. doc--ems e�c, C. DEDUCTIBLES AND COINSURANCE: • When applicable, the amount payable under this Article will be reduced by the Deductible amount and/or the Coinsurance percentage stated in the Application. ARTICLE XIII. BASIC COVERAGE FOR DOCTOR'S SERVICES EXCEPT PREGNANCY A. DETERMINATION OF PAYMENT: 1. All payments made under this Article for services provided in Nebraska will be based on the Usual,Customary and Reasonable charge. 2. All payments made under this Article for Covered Services not provided in Nebraska will be based on the Usual, Customary and Reasonable charge for the specific geographical area if such data is available to the Company. If such data is not available, payment will be based on the Customary or Reasonable charges made by Doctors in Nebraska. 3. In order for a Covered Person not to be responsible for charges in excess of the Usual, Customary and Reasonable charge,the Covered Person must: Group— UCR 15 a. Have the Covered Services performed by a Contracting Doctor; b. At the time services are requested, or in an emergency or accident case, as soon thereafter as reasonably possible, advise the Contracting Doctor of coverage by presenting the Identification Card issued to the Subscriber; 0 Not enter into an agreement with the Contracting Doctor before the date the service is provided for a specific charge in excess of the Usual,Customary and Reasonable charge. '�4 When a Contracting Doctor provides a Covered Service and charges an amount greater than the Usual and Customary charge and the Covered Person has met the above requirements,the Company will take such action as is set forth in the Agreement between the Company and the Contracting Doctor to reduce the amount to be paid by the Company,and the Covered Person shall not be required to pay such excess charge. 5. No payment will be made under this Article which exceeds the actual charge of the Doctor. 6. Any charge by a Doctor other than a Contracting Doctor which exceeds the payment provided by this Article is the responsibility of the Covered Person. B. BASIC DOCTOR SERVICES COVERED 1. Surgery: Payment will be made for Covered Services provided by the Doctor in charge of the case.consisting-of operative and cutting procedures and the treatment of fractures and dislocations and such Covered.Services shall include such surgery and normal preoperative and postoperative care of a Hospital Inpatient, and normal postoperative care if the Covered Person is not hospitalized. a. When multiple or bilateral surgical procedures which add significant time or complexity to patient care are performed at the same operative session, the total benefits shall be the amount payable for the major procedure plus: (1) fifty percent (50%) of the amount payable for the secondary procedure if only one incision is required,or (2) seventy-five percent (75%) if a separate incision is required. b. When an incidental procedure such as an incidental appendectomy,lysis of adhesions,excision of previous scar, or puncture of ovarian cyst, is performed through the same incision as for other surgery, the amount payable shall not exceed ten percent (10%) of the normal surgical allowance for the incidental surgery. c. When a surgical procedure is performed in two or more steps or stages, payment will be limited to the amount provided for a single procedure. 2. Surgical Assistance: Payment not to exceed twenty percent (20%) of the amount payable for surgery will be made for surgical assistance by a Doctor who actively- assists the operating Doctor in the performance of certain surgical procedures. Major surgical procedures .for which coverage is provided for surgical assistance are those specifically identified in a Schedule -of Allowable Assistant at Surgery Procedures on file with the Department of Insurance of the State of Nebraska. 3. Anesthesia: Payment will be made for services for anesthesia when personally administered by a Doctor. Anesthesia services shall include preoperative and postoperative visits and the administration of fluids or blood incident to the anesthesia or surgery, but shall not include administration of anesthesia by the attending or assisting surgeon (except spinal,digital,saddle or caudal blocks) nor local infiltrations by whomsoever administered. 4. Non-Surgical Inpatient Hospital Visits: Payment will be made for services for necessary non-surgical care or treatment of a condition other than that for which surgical care is required for up to the number of days in each Benefit Period as stated in the Application when a Covered Person is confined as an Inpatient in a Hospital. If surgery is performed by other than the admitting Doctor,the admitting Doctor is eligible for payment of Hospital visits up to the date of surgery. 5. Concurrent Inpatient Hospital Visits: Payment for Inpatient Hospital visits covered by Paragraph 4 are provided when performed by two or more Doctors on the same day if in the opinion of the Company the services are: Group— UCR 16 a. For a non-surgical medical problem which requires the services and skill of two or more Doctors. b. Necessary because of medical complications requiring non-surgical care not related to surgery and not constituting a part of the usual, necessary and related preoperative and postoperative care and requiring supplemental skills not possessed by the attending surgeon or his assistants. 6. Inpatient Consultation Service: When a Covered Person is an Inpatient, payment will be made for services provided by a consulting Doctor when requested by the Doctor in charge of the case and when the patient's condition requires special care or knowledge not possessed by the attending Doctor. Consultation charges are payable only once fpr each medical specialty for each Hospital confinement. No payment shall be made if the consulting Doctor prof/ides other services which are payable under this Contract during the same period of confinement. 7. Radiation Therapy: Payment will be made for Inpatient or Outpatient Roentgen therapy or implantation of radium or radon, but not for Grenz Ray or ultraviolet treatments nor for teleradeotherapy. 8. Tissue Examinations: Payment will be made for tissue examinations in connection with surgical procedures, whether performed in a Hospital Inpatient or Outpatient facility or in the Doctor's office. 9. Pap Smears: Routine Pap smear test payments are limited to one per Covered Person each Membership Year. 10. Radiology and Pathology Services: Payment will be made for such services when billed by a Doctor under the following conditions: a. For Illness,when provided to a Hospital Inpatient. b. For Injury,when provided to a Hospital Inpatient or Outpatient or in a Doctor's office. c. For Medical Emergency,when provided to an Outpatient in the emergency room of a Hospital,but only for initial care provided within twenty-four(24) hours of the onset of the Medical Emergency. 11. Doctor's Outpatient and Office Visits: Benefits for initial care only will be payable for the Doc;or's Outpatient services or office visit under the following conditions unless benefits for surgery or other Hospital visits are provided for the same Doctor for the same date of service. a. For Injury, when provided in a Hospital Outpatient Department or emergency room within seventy-two (72) hours of the Injury or in the Doctor's office within fourteen (14) days of the Injury. b. For Medical Emergency, when performed in the emergency room of a Hospital within twenty-four (24) hours of the onset of the Medical Emergency. 12. Services in a Free-Standing Ambulatory Facility: Benefits will be-paid for services of a Doctor in a Free-Standing Ambulatory Facility if such services would be payable in the Inpatient or Outpatient Department of a Hospital. C. COINSURANCE When applicable, the amount payable for Services under this Article will be reduced by the Coinsurance percentage stated in the application. ARTICLE XIV. PREGNANCY A. Persons eligible for maternity care shall receive the benefits available under Articles XII and XIII for obstetrics, abortions, threatened abortions, miscarriages, premature deliveries, ectopic pregnancies, and other conditions or complications caused by or arising from pregnancy, if normal childbirth would have occurred after two hundred seventy (270) days of continuous maternity coverage. B. Additional benefits will be provided for all medically necessary radiology and pathology procedures performed in a Doctor's office or as an Outpatient in a Hospital. Group - UCR 17 • � I 1 C. Room and board for a newborn well infant will be provided for as long as the mother is confined in the Hospital and is eligible for maternity benefits. D. Under Family Membership at the time of birth, no waiting periods are applicable to newborn children requiring definitive treatment for medical or surgical reasons at birth. E. The following are excluded: 1. All services provided by a Doctor to a newborn well infant, except circumcision under a Family Membership; room and board or nursery care for a newborn well infant when the mother is not eligible for maternity benefits,or if dependent children coverage is not elected. 2. Coverage for any individual other than a Subscriber or Subscriber's spouse. F. Prior membership which provided maternity coverage for the Subscriber or spouse in continuous effect to the Effective Date of this coverage shall be credited toward the waiting period specified herein. G. Deductibles and Coinsurance as referred to in Articles XII and XIII are applicable. ARTICLE XV. ORAL SURGERY _ A. Benefits available under Articles XII and XIII will be provided under this Contract for the following services,whether treatment is provided by a Doctor of Medicine or a Doctor of Dental Surgery or Oral Surgery. 1. Incision of accessory sinuses,salivary glands or ducts. 2. Incision and drainage of cellulitis. 3. Excision of tumors and cysts of the jaws,cheeks,lips,tongue, roof and floor of the mouth. 4. Excision of exostoses of the jaw and hard palate. 5. Surgical procedures required to correct accidental injuries of the jaw (including pathological fractures),cheeks, lips, tongue, roof and floor of the mouth,when such injuries have occurred while the person is continuously covered by the Company. 6. Reduction of dislocations of,and excision of,the temporomandibular joints. 7. Bone grafts to the mandible or maxilla. B. Only the following benefits will be provided under this Contract for or in connection with the removal of impacted teeth: 1. (Doctor's Office) Payment will be made for surgical services performed in a Doctor's office, as provided in Article XIII, Paragraph B.1. 2. (Hospital Outpatient) Payment will be made for Hospital services as provided in Article XII, Paragraph B,and for surgical services performed in a Hospital Outpatient Department as provided in Article XIII, Paragraph B.1. 3. (Hospital Inpatient) Only if the Hospital admission is essential to safeguard the life and health of the Covered Person because of the existence of a specific nondental organic impairment will payment be made for Hospital services as described in Article XII, Paragraph A, and for surgical services as described in Article XIII, Paragraph B.1,for removal of impacted teeth performed as an Inpatient of a Hospital. A Subscriber may apply in writing for a Company determination before hospitalization by submitting a written statement from the Doctor who will attend the Covered Person during the hospitalization. After review of the statement, a determination will be made and the Subscriber advised. Group— UCR 18 •• C. All other surgical procedures involving the teeth and supporting structures are excluded except that Hospital services as described in Article XII, Paragraphs A and B, will be provided when the services are performed as an Inpatient or in an Outpatient Department of a Hospital, if the admission is essential to safeguard the life and health of the Covered Person because of the existence of a specific nondental organic impairment. A Subscriber may apply in writing for a Company determination before hospitalization by submitting a written statement from the Doctor who will attend the Covered Person during the hospitalization. After review of the statement, a determination will be made and the Subscriber advised. D. All other treatments involving the teeth and supporting structures are excluded, including preparation of the mouth for dentures, orthodontic care,gingival tissues,or alveolar processes. E. Deductibles and Coinsurance as referred to in Articles XII and XIII are applicable. ARTICLE XVI. MENTAL AND NERVOUS ILLNESS, DRUG ADDICTION AND ALCOHOLISM A. Benefits available under Articles XII and XIII will be provided under this Contract for a Covered Person confined in a Hospital as an Inpatient,for services provided for acute care of mental and nervous illness,alcoholism,or drug addiction, or any combination thereof, but not to exceed thirty (30) days per confinement. Successive confinements to a Hospital shall be deemed to be continuous and to constitute a single Hospital confinement if discharge from and readmission to any Hospital shall occur within a one-hundred and eighty (180) day period. B. Additional benefits available under Article XII will be provided under this Contract for acute care and rehabilitative services provided a Covered Person confined as an Inpatient primarily for alcoholism or drug addiction, in a Hospital or other facility with which the Company has a specific and separate contract for such acute and rehabilitative-services,subject to the same limits.as set forth in Paragraph A above.The benefits provided will be governed entirely by the contract which the Company has with such Hospital or other facility,which contract shall be on file with the Department of Insurance of the State of Nebraska, but such benefits and covered period shall in no event be less than those described in Paragraph A above. C. The Deductible and Coinsurance as referred to in Articles XII and XIII is applicable. ARTICLE XVII. MAJOR MEDICAL BENEFITS A. COVERED SERVICES AND SUPPLIES: Benefits will be provided for the following Covered Services and supplies upon receipt by the Company of a completed Major Medical claim form: 1. Covered hospital charges as provided in Article XII in excess of the limited.number of days stated for Article XII in the Application. 2. Consultations,surgery,and hospital,office and home visits by Physicians. - 3. Anesthetics and anesthesia service. 4. Oxygen and equipment for its administration and inhalation therapy. 5. Radiology and pathology services for Illness, Injury or Pregnancy. 6. Ambulance service to the nearest facility where the Covered Person may receive appropriate emergency care for any Illness, Injury or Pregnancy. 7. Physical therapy provided by a qualified licensed professional Physical Therapist under the direct supervision of a Doctor and as determined to be medically necessary by the Company. 8. Speech therapy when related to a cerebral vascular accident or cerebral tumor, or when the patient has had a laryngectomy and as determined to be medically necessary by the Company. 9. Initial purchase of orthopedic braces (except shoes or related corrective devices), crutches, and prosthetic appliances such as artificial limbs and eyes, as prescribed by a Doctor, including subsequent purchases if prior authorization is given by the Company. Group— UCR 19 • • 10. Rental of durable medical equipment when determined to be necessary by the Company and when prescribed by a Doctor, not to exceed ninety (90) days unless prior approval for an extension is obtained from the Company. If in the judgment of the Company the purchase of such equipment will be less expensive than rental,the Company may provide for the initial purchase upon request. 11. Allergy tests and injections of allergy extracts. 12. Routine immunizations. 13. Drugs, intravenous solutions, vaccines, biologicals, and medicines which by law require a Doctor's prescription and which are commercially available for purchase and are listed in official formularies,except that insulin is covered for diabetics without a renewal prescription. 14. Services, supplies, or appliances for dental tre tment of natural teeth required as a result of and directly related to injury occurring while the Covered Person is covered under this Contract and provided within twelve (12) months of the date of the injury. 15. One set of eyeglasses or contact lenses (and replacements because of a change in prescription of at least one diopter) required as a result of and directly related to intraocular surgery or ocular injury. 16. Nursingcare bya Registered Nurse R.N. or a Licensed Practical Nurse L.P.N. 9 ( ) (L.P.N.) when the care: • a.. Is provided outside a Hospital,and b. Is ordered by the attending Doctor,and c. Requires the technical proficiency and scientific skills of a R.N. or L.P.N., subject to the Exclusions in Section B, Paragraph 8 of this Article. B. EXCLUSIONS AND LIMITATIONS: In addition to the Exclusions and Limitations stated in Article II of this Contract,no payment will be made under this Article for: 1. Hospital room and board charges in excess of the daily room allowance stated in the Application. 2. Eye exercises or visual training (orthoptics). 3. Lodging or travel, even though prescribed by a Doctor, for the purpose of obtaining medical treatment,except as provided in Section A of this Article. 4. Air conditioners,humidifiers,dehumidifiers,purifiers,and any other environmental control equipment. 5. Exercise equipment. 6. Repairs,maintenance or adjustment of durable medical equipment. 7. Dentistry, oral surgery or dental X-rays, except for services covered by Article XV of this Contract or Section A, Paragraph 14 of this Article. 8. Services for nursing care by a Registered Nurse or a Licensed Practical Nurse for: a. A private duty nurse for the convenience of the patient or the patient's family who is employed primarily for bathing,feeding, exercising, homemaking, moving the patient,giving medication, or acting as a companion or sitter. b. A private duty nurse who is an immediate relative, i.e., spouse, parent,child,brother or sister,by blood, marriage,adoption,or member of the household of the Subscriber. Group— UCR 20 • • • • c. Persons physically able to be transported to receive medical care. 9. Well baby care or routine examinations regardless of age. • 10. Deductibles or any Coinsurance amounts from any part of this Contract. . 11. Covered charges in excess of the Usual,Customary and Reasonable amount. 12. Marital or similar counseling services or educational services. 13. Social workers and non-licensed psychologists whether or not under the supervision of an attending Physician. 14. Other services or supplies not specifically covered in Paragraph A of this Article. C. DEDUCTIBLE: 1. A Covered Person's Deductible for a calendar year will be satisfied when expenses for Covered Services and supplies as stated in Paragraph A, incurred in that calendar year,equal the Major Medical Deductible amount stated in the Application. The first calendar year begins on the Effective Date of coverage and ends on December 31 of that same year. 2. When one member of a covered family has satisfied the Major Medical Deductible stated in the Application, the remaining family members may combine their charges to meet one additional Deductible of the same amount. after which Major Medical Benefits will be provided to all covered members of the family for the remainder of that calendar year. 3. If the total covered charges for a calendar year are less than the required Deductible, any covered charges incurred during October, November, and December of that year may be carried over and applied against the Deductible for the succeeding calendar year. D. PERCENTAGE PAYABLE: • 1. After the Deductible has been satisfied, for care and treatment of Nervous and Mental conditions, Drug Addiction and Alcoholism, in or out of the Hospital, payment will be made for the percentage of covered charges for these conditions as stated in the Application. 2. For all other conditions, after the Deductible has been satisfied, payment will be made for the percentage of covered charges stated in the Application. E. MAXIMUM BENEFITS: "c• 1. Lifetime maximum benefits payable for each Covered Person for the treatment of Nervous and Mental dis- 3 j orders,Drug Addiction and Alcoholism shall not exceed the amount stated in the Application. 5', 00 2. Lifetime maximum benefits payable for each Covered Person for the treatment of all conditions shall not exceed the total amount stated in the Application. 3. Lifetime maximums apply to coverage under this Contract and to all benefits paid by the Company under prior Major Medical coverage. 4. The total lifetime maximum may be restored at any time after a Covered Person has received payments under this Article in excess of $1,000.00 providing the Company receives satisfactory evidence of insurability and approves reinstatement of the lifetime maximum in writing. F. COVERED PERSONS LIMITED LIABILITY (STOP LOSS): When the Deductible and the Coinsurance amounts under this Article equal the Stop Loss amount stated in the Application, the Company shall pay one-hundred percent (100%) of the covered services under this Article incurred during the remainder of that calendar year, not to exceed the lifetime maximum. Group— UCR 21 , /. ; ,, _ • G. CLAIMS FILING TIME: Claims must be filed within twelve (12) months from the end of the calendar year in which the expenses are incurred or as provided in Article III, Paragraph E of this Contract. It is suggested that all claims for one calendar year be filed with the Company prior to,and separately from,any claim for charges incurred during the succeeding calendar year. ARTICLE XVIII. OUTPATIENT AND DOCTOR'S OFFICE RADIOLOGY AND PATHOLOGY SERVICES A. Benefits will be provided for radiology and pathology services required for the diagnosis or treatment of Illness or Injury when performed in the Outpatient Department of a Hospital or in a Doctor's office and which are not covered elsewhere in this Contract. B. Payments for such services shall not exceed the percentage and maximum stated in the Application. C. No payments shall be provided under this Article for routine or annual physical examinations,screening examinations, or services related to dental care. • • • • t i Group— UCR 22 , EXHIBIT B-2 -� PPO NEBRASKA p PREFERR ED PROVIDER ORGANIZATION C/7!I/7iitf:' C . MASTER GROUP CONTRACT FOR EMPLOYERS AND ASSOCIATIONS PPO Nebraska is a Preferred Provider health benefits plan offered by Blue Cross and Blue Shield of Nebraska, a mutual insurance company, Licensed by the State of Nebraska. This Contract provides benefits for specific health services provided to Covered Persons by PPO Nebraska Physicians, Hospitals and other health care providers. These providers have agreed to furnish services to Covered Persons in a manner reasonably expected to effectively manage health care costs. Blue Cross and Blue Shield of Nebraska agrees to make payment for the health services described, defined and limited herein during the term of this Contract. Coverage will start at 12:01 a.m. on the effective date stated in the Master Group Application, in consideration of the payment of premiums or charges as provided in the Master Group Application. This Contract consists of the Master Group Application, this document and any attachments or endorsements hereto. Only Blue Cross and Blue Shield of Nebraska can approve a change to this Contract and that change must be in writing. Any change will affect all Covered Persons and no'agent may change the Contract in any way. The Group Applicant, as the agent representing the group health plan, binds all Employees/Members and their covered dependents who are beneficiaries of such plan, to the terms and conditions of this Contract. This Contract is made in and governed by the laws of the State of Nebraska. The Employer or Association making application will be referred to by the personal pronouns "you" or"your," or"Group Applicant." The Covered Person may also be referred to as "Employee" or as a "Member" of an Association. The defined terms are capitalized in this Contract. BLUE CROSS AND BLUE SHIELD OF NEBRASKA By: ..4.ol4 •a Richard L. Guffey, Chairman and Chief Executive Officer • TABLE OF CONTENTS PAGE Part I. Eligibility, Effective Date of Coverage,Waiting Periods, 1 Evidence of Coverage Part II. Charges for Coverage; Grace Period 3 Part III. Continuation of Coverage, Conversion Coverage 4 Part IV. Benefits Overview 7 Part V. Benefits For Hospital Services, Except Maternity 11 Part VI. Benefits For Physician's Services, Except Maternity 12 Part VII. Benefits For Maternity 14 Part VIII. Benefits For Mental Illness, Drug Addiction and Alcoholism 15 Part IX. Benefits For Oral Surgery and Dentistry 17 Part X. Benefits For Organ Transplants 18 Part Xl. Benefits for Home Health Aide and Hospice Services 19 Part XII. Benefits For Other Covered Services and Supplies 20 Part XIII. Exclusions and Limitations 25 Part XIV. Procedures for Filing a Claim 28 Part XV. Coordination of Benefits 28 Part XVI. Subrogation 31 Part XVII. Workers'Compensation 31 Part XVIII. Standard Provisions 31 Part XIX. Definitions 32 .L . 9836 Rev.5/1/90 PART I. ELIGIBILITY, EFFECTIVE DATE OF COVERAGE, WAITING PERIODS, EVIDENCE OF COVERAGE A. ELIGIBILITY: 1. If you complete the Master Group Application as an employer, each of your employees is eligible to make application for coverage. Such application, made on our Enrollment Form, may include a request for coverage of the employee's spouse and other dependents. Such eligibility is, however, subject to a probationary period and any other conditions stated in the Master Group Application. Dependents must qualify as Eligible Dependents as defined herein for benefits to be payable. 2. If the Master Group Application is made by an association, every regular member of the association, their full-time employees and all association employees, are eligible to make application for coverage. Such application, made on our Enrollment Form, may include a request for coverage of the employee or the employee and the employee's spouse and other dependents. Such eligibility is, however, subject to a probationary period and any other conditions stated in the Master Group Application. Dependents must qualify as Eligible Dependents as defined herein for benefits to be payable. 3. If the Master Group Application is made by some other form of group, eligibility shall be subject to all conditions, including a probationary period, stated in the Application. 4. Our Enrollment Form is a questionnaire on which the employee provides the information necessary to determine eligibility for coverage. Our Enrollment Form requires the election of a Membership Unit, and the identity of dependents. By Membership Unit, we mean the category of persons to be provided benefits. The following Membership Units may be selected: 1. Single Membership: This option provides benefits for Covered Services provided to the employee only. 2. Employee-Spouse Membership: This option provides benefits for Covered Services provided to the employee and his or her spouse. 3. Single Parent Membership: This option provides benefits for Covered Services provided to the employee and his or her Eligible Dependents, but not to a spouse. 4. Family Membership: This option provides benefits for Covered Services provided to the employee and his or her Eligible Dependents. B. EFFECTIVE DATE OF COVERAGE: Subject to any probationary period stated in the Master Group Application, and the receipt by us of a completed Enrollment Form, coverage for employees, and their Eligible Dependents, shall be determined by the rules set forth below. 1. For persons eligible on the effective date of this Contract, coverage shall start on that date. 2. Any person who becomes eligible after the effective date of this Contract must submit an Enrollment Form. This Form must be received by us within thirty-one (31) days of that person becoming eligible. Coverage shall be effective on the next monthly due date following the person's eligibility date. 3. Persons whose Enrollment Forms are not received by us within thirty-one (31) days of their eligibility will be required to furnish proof of insurability. If accepted, coverage for such persons will be effective on the group's monthly due date following approval of their Enrollment Form by us, subject to any Waiting Periods. At the time of application, the person may request an earlier effective date, provided such date is after the date the Enrollment Form is submitted and corresponds with a monthly due date. 9836 Rev. 5/1/90 1 4. Coverage under this Contract for any person confined in a Hospital, convalescent hospital, or place of treatment for mental illness, drug addiction, or alcoholism, on their initial effective date, shall not begin • unti 12:01 A.M. on the day after dismissal therefrom. If this Contract replaces another Contract with us, benefits for Covered Services furnished by this Contract shall not begin until the Covered Person is discharged from the Hospital. 5. If an employee who has a Single Membership wishes to obtain coverage for his or her Eligible Dependents, that employee must request such change from us in writing. Such request must be made within thirty-one (31) days of the spouse or other dependents becoming eligible. The employee must indicate the Membership Unit requested and identify the dependents. If such request is not made within thirty-one (31) days of the spouse or other dependents becoming eligible, proof of insurability will be required, and such persons will be subject to Waiting Periods. If an employee changes from Single Membership to coverage that includes dependents and the Enrollment Form is received within thirty-one (31) days of the dependent's eligibility, coverage of the employee's Eligible Dependents shall begin on the group's next monthly due date following the dependent's eligibility date. At the time the Enrollment Form is submitted, a newly-married employee may backdate an Employee-Spouse or a Family Membership to the group's last monthly due date before the marriage. 6. Coverage for Injury or Illness (including the necessary care and treatment of medically diagnosed congenital defects and birth abnormalities) shall begin at birth for children of an employee with a Family Membership or Single Parent Membership in effect. Coverage will also be provided for the child of an employee with an Employee-Spouse Membership for thirty-one (31) days from the date of birth. To continue such coverage,the employee must request the Membership be changed to Family Membership or Single Parent Membership within such thirty-one day period, and pay the additional premium. l C. WAITING PERIODS: 1. No benefit payment will be made for Covered Services provided for a Pre-existing Condition, congenital defect or birth abnormality until Blue Cross and Blue Shield of Nebraska coverage has been in effect for at least 365 continuous days. • a. Pre-existing Condition is defined as an Illness or Injury for which a physician prescribed medication or rendered medical treatment or advice within twelve (12) months prior to the effective date of coverage. A Pre-existing Condition is also defined as an Illness which exhibited symptoms within twelve (12) months prior to the effective date of coverage or a previous Injury which exhibited symptoms or complications within twelve (12) months prior to the effective date of coverage, either of which would lead a prudent person to seek medical treatment or advice. b. A congenital defect or birth abnormality is defined as a condition existing at or from birth which is a deviation from the norm, such as clefting, protruding ears, birthmarks, webbed fingers or toes, and other conditions normally considered congenital defects or birth abnormalities. 2. Benefit payments for Pregnancy, or any complications thereof, shall not be made for services provided unless normal childbirth either does or would have occurred after 270 days of continuous Blue Cross and Blue Shield of Nebraska maternity coverage. D. EVIDENCE OF COVERAGE: When coverage becomes effective for a person in your group,we will provide that person with a Certificate of Coverage, a Schedule of Benefits, and two PPO Nebraska Identification Cards. The Certificate of Coverage is a booklet which summarizes the terms of our Contract with you. 9836 Rev. 5 1 90 / / 2 The Schedule of Benefits is a personalized document generated by us which identifies your coverage option and the Membership Unit which the employee has selected. By coverage option, we mean the level of benefits to be provided under this Contract as indicated by you on the Master Group Application. The Schedule of Benefits provides information as to Deductible Amounts, Coinsurance rates, the Maximum Coinsurance Liability, and maximum benefits. It also indicates any applicable Waiting Periods. The Identification Card identifies a person as a member of the PPO Nebraska program. This card must be presented when services are provided. PART II. CHARGES FOR COVERAGE; GRACE PERIOD A. Premiums for coverage are payable monthly in advance, on or before the due date. Payment shall be made at our home office. B. The rates in the Master Group Application are used to compute the monthly premium. We may change the rates: (a) on any due date after the first year if we give you thirty (30) days written notice; or (b) whenever the Contract terms are changed. It is agreed that the rates may change after thirty (30) days notice if the cost of providing services and the administration thereof so requires, or if a benefit increase is required by law. C. Unless otherwise agreed, the monthly charge for your group equals the sum of the applicable premium for all persons in the group as of the due date. D. We will allow a thirty-one (31) day grace period after the due date for payment each month. The Contract remains in force if the payment is received during that(31)day grace period. If we do not receive payment during the thirty-one (31) day grace period,the Contract is canceled as of midnight of the last day for which premiums have been paid. No payment shall be made for Covered Services provided after the effective date of cancellation of this Contract. E. if payment of a premium for your group is submitted after the'thirty-one (31) day grace period,we may accept it and issue a conditional receipt, requiring you to submit a new Master Group Application. The Contract will be reinstated only if we approve the application, or if we do not notify you of disapproval,forty-five (45) days after the application is received. If the Contract is reinstated,your group will be given a new effective date. The reinstated Contract covers only loss resulting from Injury which is sustained after the date of reinstatement and Illness that begins more than ten (10) days after reinstatement. In all other respects, the Contract rights remain the same. The accepted premium shall be applied to the month of your effective date. If we do not reinstate your Contract,we will refund the payment which was conditionally received. F. We may cancel the Contract at any time by notifying you in writing of such cancellation. Such written notice must be delivered to you or the subgroup at least thirty-one (31) days prior to the effective date of cancellation. We will not be required to provide notice to individual persons in your group or of any subgroup, if cancellation occurs, nor will we be required to provide any conversion coverage to persons if we cancel your group contract G. We have the right to cancel this Contract pursuant to paragraph F, above, if you enter into a benefit agreement with any other insurance company or enter into any other benefit financing arrangement, including becoming self-insured. We will not be required to provide any conversion coverage to persons if we cancel your group contract pursuant to this paragraph. H. You may cancel this Contract by written notice to us. Such cancellation shall be effective on the last date for which premiums have been paid, or a future date specified by you. You will be responsible for payment of premiums untU any future date specified. We will not be required to notify persons in your group of your cancellation nor will we be required to provide any conversion coverage to such persons if you cancel your group. Cancellation shall not affect any claim for services provided before the effective date of cancellation. I. If you give us proof that a refund of premiums should be made, the refund will be limited to the twelve (12) month period prior to receipt of this proof. 9836 Rev. 5/1/90 3 1 • PART III. CONTINUATION OF COVERAGE; CONVERSION COVERAGE A. CONTINUATION OF COVERAGE 1. Nebraska Continuation Law: Nebraska employers who, based on the number of employees, are not subject to the federal COBRA continuation law (paragraph 2, below) are subject to the Nebraska continuation law, Neb. Rev. Stat. Section 44-1640 through 44-1645 (R. S. Supp., 1989). The Nebraska law provides that an employer must offer the opportunity to continue coverage under this Contract in two circumstances: ■ Involuntary Termination: If you terminate an employee's employment for reasons other than misconduct, you must offer that employee the opportunity to continue insurance coverage for up to six (6) months. • Death: If one of your covered employees dies, you must offer the opportunity to continue coverage to a covered spouse or covered dependent children of that employee for a period of one (1) year following the date of death. a. If the continuation coverage is elected, it shall continue until the earliest of the following dates: (1) In the case of a terminated employee, coverage for the employee and his covered dependents may be continued for up to six (6) months from the date coverage would otherwise terminate. (2) In the case of the covered surviving spouse or other covered dependents of a deceased employee, coverage may be continued for up to one (1) year from the date coverage would otherwise terminate. (3)The date the Covered Person becomes eligible for other group health coverage or becomes eligible for Medicare; and with respect to the surviving spouse, the date such spouse remarries or becomes eligible fo;Medicare or covered by Medicaid. (4)The date the conversion option is exercised. (5)The date on which your Contract with us is terminated. If you terminate your Contract with us, continuation coverage shall also terminate.We will not provide conversion coverage to any person who was a Covered Person pursuant to your Contract on the date of termination, nor will we provide notice to them of the termination of your Contract. (6)The date on which coverage expires for nonpayment of premium. b. Payment of premiums for continuation coverage is the responsibility of the terminated employee or the surviving spouse or dependents of a deceased employee. c.The employer must send a notice of the right to continuation of coverage to the eligible Covered Person by certified mail with return receipt requested to the home address of the employee as shown on your records, no later than ten (10)working days after the termination or death. The notice must set forth the right to continue coverage, the amount of the monthly premium and the proper procedure for continuing the coverage. (1)Terminated employees desiring to continue coverage must return the form and the first premium by certified mail with return receipt requested to Blue Cross and Blue Shield of Nebraska, P.O. Box 3248, Omaha, NE, 68180-0001, within ten (10) days after receipt of the notice. 9836 Rev. 5/1/90 4 ' , (2) Covered surviving spouses or dependent children desiring to continue such coverage must return the election form and the first monthly premium by certified mail with return receipt requested to Blue Cross and Blue Shield of Nebraska, P.O. Box 3248, Omaha, NE 68180-0001, within thirty-one (31) days after the date of death of the employee. d. Premiums for each subsequent month shall be paid by the Covered Person(s) to Blue Cross and Blue Shield of Nebraska without further notice. e.The experience from the continuation coverage shall be charged to your group. 2. Federal Continuation Laws: A Nebraska employer may also be subject to Public Law 99-272, the Consolidated Omnibus Budget Reconciliation Act (COBRA) and subsequent amendments and regulations. The law applies to group health plans for any calendar year in which the employer employed twenty (20) or more employees on 50% of its working days during the preceding calendar year. Under COBRA, a covered employee who would lose coverage due to a reduction in work hours, or the termination of employment because of voluntary quit, lay-off for economic reasons, or for misconduct other than gross misconduct, may elect to continue his or her coverage under the group Contract. In addition, COBRA requires that continuation of group coverage be made available to the covered surviving spouse and other Eligible Dependents of a covered employee who dies; to a covered employee's spouse and other Eligible Dependents who would lose coverage because of divorce or legal separation, or because of the employee's entitlement to Medicare; and,to Eligible Dependent children who would lose coverage because of loss of dependent status. The above-mentioned circumstances which entitle persons to elect to continue coverage are known as"qualifying events,"and such persons are known as 'qualified beneficiaries." COBRA coverage may not be conditioned on evidence of insurability and it must credit qualified beneficiaries with incurred deductibles, coinsurance and maximum limits. • a. if the continuation coverage is elected, it shall continue until the earliest of the following: (1)The date of expiration of the period allowed by law, and set forth below, in paragraph b. (2)The date the person electing coverage becomes entitled to Medicare or covered under another group health plan which does not exclude or limit any Pre-existing Condition. COBRA law requires that continuation coverage be available for a Pre-existing Condition that is not covered under another plan. (3)The date of expiration of the monthly period for which premiums were paid in the event of a nonpayment of premium. (4)The date the group ceases to offer any group health plan to its employees. If you terminate your Contract with us, continuation coverage will continue with the successor plan of your group. We will not provide conversion coverage to any person who was a Covered Person pursuant to your Contract on the date of such termination, nor will we provide notice to them of the termination of your Contract. b. Continuation coverage is allowed: (1) For up to eighteen (18) months after the date of the qualifying event for a covered employee whose coverage under the Contract would otherwise be terminated because of a reduction in work hours or the termination of full-time employment of such employee,for the following reasons: (a) voluntary quit, (b) lay-off for economic reasons, and (c) discharge for misconduct other than gross misconduct. (2) For up to twenty-nine (29) months after the date of the qualifying event if the employee is determined to be disabled under the Social Security Act at the time they become eligible for COBRA continuation coverage, or within eighteen (18) months of becoming eligible for continuation coverage. A qualified beneficiary must provide notice to the plan no later than s (60) days after the date of the Social Security determination. 9836 Rev.5/1/90 5 (3) For up to thirty-six (36) months after the date of the qualifying event for the following groups: (a) the surviving spouse and other covered dependents of a covered employee,whose coverage would otherwise be terminated because of the death of such employee, (b) the covered separated or divorced spouse and children of a current covered employee whose coverage would otherwise be terminated because of the divorce or legal separation of the covered employee, and (c) the children of current covered employees whose coverage would otherwise be terminated because of their loss of dependent status, and (d) the spouse or dependent children of a covered employee whose coverage would otherwise terminate because of the employee's entitlement to Medicare. Persons in (b) and (c) must notify you of such event within sixty(60) days in order to be eligible for such coverage. c. Payment of premium for continuation coverage is the responsibility of the person electing to continue coverage. d. Not later than fourteen (14) days following the date the employer receives notice of the qualifying event,the employer shall send a notice by first class mail to the eligible person at his or her home address as shown on the records of the employer. Such notice shall set forth: (1)The right of the eligible person to elect to continue coverage, and the election form to be issued in exercising such right. (2)The amount of each monthly premium to be paid by the terminated employee, or qualified beneficiary. • (3) Directions regarding completion and mailing of the election form and amount of each monthly premium that must be paid. e. If the person elects to continue such coverage,the election form shall be sent by first class mail to Blue Cross and Blue Shieid of Nebraska, P.O. Box 3248, Omaha, Nebraska, 68180-0001, or to the employer, if so directed,within sixty (60) days after the notice is sent or the date the qualified beneficiary would lose coverage,whichever is later.The first premium must be paid within forty-five (45) days after the election. f. Premiums for each subsequent month shall be paid by the Covered Person(s) to Blue Cross and Blue Shield of Nebraska without further notice. g.The experience from the continuation coverage shall be charged to your group. B. CONVERSION COVERAGE 1. ELIGIBILITY: In addition to the right to continuation of coverage provided by State and Federal law, discussed in the preceding paragraphs,a Covered Person may elect to convert to a coverage plan separate from the group plan, offered by us. The Covered Person may request conversion coverage whenever his or her coverage under your group plan is terminated, subject to the following: a. The Covered Person is no longer eligible for your coverage; b. The Covered Person becomes eligible for conversion coverage while the group Contract with us is still in effect; c. The application for conversion coverage is received by us within thirty-one (31) days of the termination of the Covered Person's coverage or within thirty-one (31) days of the Eligible Dependent's ineligibility for group coverage, or within the 180- day-period that ends on the expiration date following the maximum COBRA coverage period; d. The payment for the first month's premium must be submitted with the application; 9836 Rev. 5/1/90 6 1 0 • e. The conversion coverage will be issued under the same type of Membership Unit as is held by the Covered Person (Single, Employee-Spouse, Single-Parent or Family) without medical underwriting. If 1 appropriate, any Covered Person may apply for a Single Membership conversion if his or her prior coverage was under any multiple party Membership. 2. CONVERSION CONTRACT a. Benefits provided by the conversion contract and all other terms and conditions thereof, including rates shall be determined by us. Such benefits may be different from benefits provided under this group contract. b. Any Waiting Period required by the conversion contract shall be reduced by the length of time the Covered Person converting has been continuously covered by us. c. If a Covered Person is an Inpatient on the date of change, Hospital benefits for that admission will be provided under this PPO Nebraska group contract. PART IV.BENEFITS OVERVIEW A. PAYMENT FOR SERVICES: • 1: PPO Nebraska Providers: We have contracted with a panel of Physicians, Hospitals, and other health care providers,to furnish services to Covered Persons in a manner reasonably expected to effectively manage health care costs. We call this program PPO Nebraska, and we call these health care providers PPO Nebraska Physicians, PPO Nebraska Hospitals or PPO Nebraska Providers. The amount of benefit payment made by us will be different depending on whether or not the service is provided by a PPO Nebraska Provider. Preferred benefits will be available when the services are provided by a PPO Nebraska Provider. This means the Deductible Amount and the Coinsurance Amount payable by the Covered Person will be greater when services are received from a provider who does not contract with PPO Nebraska. The PPO Nebraska Provider agrees to accept our payment plus payment by the Covered Person of any Deductible Amount, Coinsurance Amount and any amount for Non-Covered Services, as payment in full. For benefits to be payable by us, all Covered Services must be Medically Necessary. a. PPO Nebraska Hospital: If a Covered Person receives care in a PPO Nebraska Hospital because of Illness, Injury, or Pregnancy, payment will be made to that Hospital for Medically Necessary Covered Services. We have contracted with the PPO Nebraska Hospital for services at a specific reimbursement amount based upon the diagnosis and procedures involved. This classification is called a Diagnostic Related Grouping (DRG). We will pay the amount for the DRG less any Deductible Amount and Coinsurance. With certain diagnoses and procedures,we have not computed a DRG. We have contracted with the PPO Nebraska Hospital for reimbursement of these Covered Services at a specific rate, based upon billed charges. Benefits will be provided less any Deductible and Coinsurance. The Covered Person is responsible for the payment of the Deductible Amount, Coinsurance and charges for any Non-Covered Services. The Coinsurance percentage is applied to the Allowable Charge for the Covered Service. b. PPO Nebraska Physician: A PPO Nebraska Physician has entered into an agreement with us that he or she will accept the lesser of his or her billed charge or the amount set forth in the PPO Nebraska Physician's Reimbursement Schedule,for Covered Services listed thereon, as payment in full. If the Covered Service is not listed, the PPO Nebraska Physician has agreed to accept the lesser of his or her billed charge or the Maximum Benefit Amount as payment in full for Covered Services. The Covered Person is responsible for payment of any Deductible Amount, Coinsurance and for any Non-Covered Services. The Coinsurance percentage is applied to Allowable Charges. 9836 Rev. 5/1/90 ;7 c. If a claim is submitted for a Covered Service which is not approved by our Utilization Review Program, the PPO Nebraska Provider agrees not to charge, collect or seek collection from the Covered Person, or from us. EXCEPTION: The PPO Nebraska Provider may collect from the Covered Person, however, for a specific service, procedure, drug, supply or item of medical equipment where benefits are not payable pursuant to our Utilization Review Program if, prior to the service being provided, the Provider has advised the Covered Person in writing, or verbally if documented in the medical record, that benefits will not be payable by us. 2. Non-PPO Nebraska Providers: a. Non-PPO Nebraska Hospital: If a Covered Person is confined as an Inpatient in a Non-PPO Nebraska Hospital because of Illness, Injury or Pregnancy, payment will be made for precertified Covered Services. The amount of benefit payment will be reduced by the applicable Deductible Amount and Coinsurance. The Covered Person is responsible for payment of the Deductible Amount, Coinsurance and charges for any Non-Covered Services. If the Covered Person fails to obtain precertification of benefits for an Inpatient hospitalization as required by Part IV.F, or for Inpatient treatment for Mental Illness, drug addiction or alcoholism, as required by Part VIII,the Allowable Charge considered for benefits for Covered Services will be reduced by twenty-five percent(25%). The Covered Person.will be responsible for payment of the amount of the reduction. b. Non-PPO Nebraska Physician: Benefits for Covered Services shall be paid based on the lesser of the Physician's billed charge or the Maximum Benefit Amount. The amount of our payment shall be reduced by the non-preferred Deductible Amount and Coinsurance. The Covered Person is responsible for the payment of the Deductible Amount, Coinsurance and any amount charged by the ) Physician which is in excess of the Maximum Benefit Amount for the Covered Service. The Covered Person is also responsible for payment for any Non-Covered Service. The Coinsurance percentage is applied to Allowable Charges for Covered Services. If the Covered Person fails to obtain precertification of benefits for Covered Services provided to an Inpatient at the time of a Non-Emergency Admission as required by Part IV.F, the Allowable Charge considered for benefits will be reduced by twenty-five percent (25%). The Covered Person will be responsible for payment of the amount of the reduction. c. EXCEPTION: If the Covered Person receives Inpatient or Outpatient care at a Non-PPO Nebraska Hospital or by a Non-PPO Nebraska Physician under the following circumstance, benefits will be paid for Medically Necessary Covered Services at the PPO Nebraska Provider preferred Coinsurance rate. The applicable Deductible Amount will be at the PPO Nebraska Provider preferred Deductible rate. ■ In case of a Medical Emergency or accident. A Medical Emergency is the sudden and unexpected onset of symptoms or the exacerbation of a chronic condition which presents an acute, severe and immediate life threatening situation or a situation where delay might lead to irreparable harm. d. If the Non-PPO Hospital, Non-PPO Physician or other Non-PPO Provider is participating with Blue Cross and Blue Shield of Nebraska under another Blue Cross and Blue Shield of Nebraska program, payment will be made pursuant to that particular program. The Hospital will be reimbursed based on DRG classifications or billed charges, as applicable. The Physician will be reimbursed on the lesser of the Maximum Benefit Amount or billed charges. These Participating Providers have agreed to accept our payment, plus the payment by the Covered Person of any Deductible and Coinsurance as payment in full for Covered Services. The Covered Person is responsible for payment for any No - Covered Services. 9836 Rev. 5/1/90 8 • e. The Covered Person may contact us to determine the Maximum Benefit Amount for a specific procedure code for an Inpatient procedure at the time the Covered Person precertifies that procedure. 3. Utilization Review: Covered Services provided by Hospital, Physicians and all other health care Providers are subject to our Utilization Review. Utilization Review is the evaluation by us of the use of a medical, diagnostic, or surgical procedure or service or the utilization of medical supplies, drugs or Durable Medical Equipment compared with established criteria in order to determine benefits. Benefits may be excluded for services, procedures, supplies,drugs or Durable Medical Equipment found by us to be not Medically Necessary. PPO Nebraska Participating Providers have agreed that the Covered Person will not be responsible for the charges for services which are determined to be non-payable by our Utilization Review programs. If benefits for a service by a Non-PPO Nebraska Provider are denied by Utilization Review and that provider is not participating with Blue Cross and Blue Shield of Nebraska pursuant to another reimbursement program, the Covered Person will be responsible for payment of the charge. 4. All payments for Covered Services provided by PPO Nebraska Hospitals, PPO Nebraska Physicians and other PPO Nebraska Providers, or any provider who is participating with us pursuant to any other reimbursement program, shall be made directly to such Participating Providers. In all other cases, payments shall, at our option, be made to the Covered Person, the Covered Person's estate, or the provider. No assignment,whether made before or after services are provided, of any amount payable according to this Contract shall be recognized or accepted by, or binding upon us. 5. We reserve the right to contract further with other health care providers and to alter benefit payment procedures to Participating Providers. Benefit payments rriade directly to a Hospital, a Physician or any other health care provider under contract with us may be calculated on a charge basis, a per diem basis, a global fee basis, pursuant to a DRG Program,through a Preferred Provider Organization, or in any other manner agreed upon between us and the provider. Paymept may be made in this manner if such payment results in the complete discharge of our liability under this Contract. 6. Other Insurance: If a Covered Person has other health and accident insurance, and the amount of the billed charges by the provider is in excess of the amount payable under this Contract,the Covered Person may be responsible for an additional payment pursuant to the Coordination of Benefits provisions in Part XV. 7. All benefits payable under this Contract shall be paid as soon as possible after the claim has been filed. 8. Large Case Management: We may expand the scope of benefits in an individual case to include payment for specific services if it appears to us that use of such services will reduce costs or improve the quality of care. We shall advise the Covered Person and the provider in writing when, and to what extent, payment for such services will be made. Such expansion of the scope of benefits shall not constitute an amendment to this Agreement, nor provide a continuing right to receive such services. B. DEDUCTIBLE 1. A Covered Person's Deductible Amount for a calendar year will be met when Allowable Charges for 9 Covered Services incurred in that calendar year equal the Deductible Amount stated in the Master Group Application and in the employee's Schedule of Benefits. The first calendar year begins on the effective date of coverage and ends on December 31 of that same year, unless stated otherwise in the Master Group Application. In instances where no PPO Nebraska Provider is available or where there is not a specific mention of the applicable Deductible Amount,the applicable Deductible will be the non-preferred Deductible Amount. The Deductible Amount credited to charges by either will be credited and totaled for application to both. 9836 Rev. 5/1/90 9 2.The Deductible Amount must be met each calendar year for each Covered Person on a Single or Employee-Spouse Membership. Employees with a Family or Single Parent Membership must meet twice the individual Deductible Amount each calendar year. 3. If the total charges for Covered Services for a calendar year are less than the required Deductible Amount, such covered charges incurred during October, November, and December of that year may be carried over and applied against the Deductible Amount for the next calendar year. C. COINSURANCE: Coinsurance is the percentage of each Allowable Charge which the Covered Person must pay. The percentage is set forth in the Master Group Application and the employee's Schedule of Benefits. D. COVERED PERSON'S MAXIMUM COINSURANCE LIABILITY: The Master Group Application for this Contract contains a Maximum Coinsurance Liability to be paid per year for Covered Services for a Single, Family, or other Membership Unit. This means that when the Maximum Coinsurance Liability is reached in each calendar year,we will pay benefits for additional Covered Services without further application of the Coinsurance, up to the maximum benefits,for the remainder of that calendar year. This computation includes Covered Services provided by both PPO Nebraska Providers and Non-PPO Nebraska Providers. Coinsurance Amounts paid by a Single, Family or other Membership Unit for Covered Services provided for Mental Illness, Drug Addiction and Alcoholism (Part VIII), Organ Transplants (Part XII) and Home Health Aide and Hospice (Part XI),will not be considered in computing the Maximum Coinsurance Liability. Computation of the Maximum Coinsurance Liability does not include amounts paid by a Single, Family or other Membership Unit for services for which this Contract does not provide benefits. Nor does it include such amount paid if we have determined that the services are not Medically Necessary and,therefore, nonpayable pursuant to our Utilization Review Program, nor for charges in excess of the Maximum Benefit Amount, nor for amounts paid as the result of reduction in benefits resulting from a failure to precertify(Part IV.F.). E. , MAXIMUM BENEFITS: 1. The maximum benefits payable for each Covered Person under all provisions of this Contract is one million dollars ($1,000,000). 2. There are two classifications of benefits within this one million dollar maximum which are subject to further dollar limitations. These limitations are: a. The maximum benefits payable for each Covered Person for the treatment of Mental Illness, Drug Addiction and Alcoholism (Part VIII) is fifty thousand ($50,000) dollars. b. The maximum benefits payable for each Covered Person for Home Health Aide Services (Part XI) is ten thousand dollars ($10,000). 3. Benefit maximums apply to coverage under this Contract and to all benefits subject to benefit maximums paid by us under prior coverage. F. PRECERTIFICATION AND CONCURRENT REVIEW: 1. PRECERTIFICATION: This Contract requires precertification of benefits in certain circumstances. Precertification authorizes payment of benefits for an Inpatient admission subject to the other terms of the Contract, including but not limited,to determination of eligibility and Pre-existing Conditions. Precertification is not a guarantee of payment. Benefits for all Covered Services provided for a non- emergency Hospital Inpatient Admission by a Non-PPO Nebraska Physician or at a Non-PPO Nebraska Hospital must be precertified. When a Covered Person is treated by a PPO Nebraska Physician and is hospitalized in a PPO Nebraska Hospital,there is no need for precertification, however, benefits for Covered Services for all admissions for treatment of Mental Illness, drug addiction or alcoholism must be approved prior to admission. It is the Covered Person's responsibility to see that we are notified when precertification is required. Actual notification to us may be made by the treating Physician, the Hospital or Treatment Center, or by the Covered Person or someone acting on the Covered Person's behalf. 9836 Rev.5/1/90 10 When precertification is requested, we will advise the Physician,the Hospital or Treatment Center, the Covered Person or someone acting on the Covered Person's behalf, in writing, of the following: ,l a. Whether benefits will be certified for Inpatient care; and b. The number of Medically Necessary days which will be considered for determining benefit payment for an approved Inpatient stay. Such authorization shall be valid if the Covered Service is provided within sixty (60) days of the authorization. If the anticipated admission date changes, we should be notified. If a Covered Person does not obtain precertification, or if precertification is denied, and the Covered Person is admitted to the Hospital or Treatment Center, the Allowable Charges considered for benefits under this Contract for all Covered Services associated with this admission will be reduced by twenty-five percent (25%). 2. CONCURRENT REVIEW: Where benefits have been precertified for a period of Inpatient hospitalization, payment will be made for Covered Services pursuant to this Contract. If additional days beyond the number of days originally precertified for benefit consideration are needed,these days must also be precertified in advance. It is the Covered Person's responsibility that we be notified of the need for additional Inpatient days. Notification to us may be made by the treating Physician, the Hospital or Treatment Center, the Covered Person, or someone acting on the Covered Person's behalf. We will advise the treating Physician, Hospital or Treatment Center, and the Covered Person if additional Inpatient days will be considered for benefit payment, in writing. Allowable Charges considered for benefits for all Covered Services provided during any period of a hospitalization which extends beyond the length of stay precertified by us will be reduced by twenty-five percent (25%). 3. If the benefit amount paid by us is reduced as a result of this Part IV.F,the benefit reduction becomes l an additional amount which must be paid by the Covered Person. This amount paid by the Covered J .Person will not be considered in computing the Maximum Coinsurance Liability, as defined in Part IV,D. PART V. BENEFITS FOR HOSPITAL SERVICES, EXCEPT MATERNITY A. OVERVIEW: Admission to a Hospital and all services must be ordered by a Physician. The following Hospital Services are Covered Services under this Contract. This means that, subject to the Exclusions and Limitations set forth in Part XI, including determinations made by our Utilization Review Program, benefits will be provided for these services when provided to a Covered Person. B. COVERED HOSPITAL INPATIENT SERVICES: 1. Hospital Room: Benefits will be provided for Hospital room and board. We will consider any special diet, and all nursing services included in the Hospital room charge. Benefits will be based upon the amount charged for a semiprivate room. If an intensive care unit, cardiac care or similar type of room is Medically Necessary, benefits will be based upon the reasonable charge for such room. When a Covered Person is confined to a private room, benefits shall be based upon the average charge for 2-bed accommodations in that Hospital, unless the patient is confined to a private (isolation) room to prevent contagion and we determine that isolation was ordered, utilized and was Medically Necessary. 2. Use of operating, cystoscopic, cast, recovery and other surgical treatment rooms and equipment. 3. Anesthetics and their administration when performed by a Hospital employee. 4. Respiratory care including oxygen,administered by a certified respiratory therapist who is a Hospital employee. 5. Drugs, intravenous solutions,vaccines, biologicals, and medicines which are prescribed for and administered to the Covered Person while hospitalized. 6. Administration of intravenous solutions, blood, blood plasma, blood derivatives, or blood fractiona e. :, 9836 Rev. 5/1/90 1`1 CO Supplies,' 7. materials and equipment, qu pment, including dressings, splints and plaster casts, except`take-home' supplies and convenience items. 8. Radiology and pathology services when billed by the Hospital. 9. Physical therapy when provided by a licensed physical therapist, or other qualified person, as an employee of the Hospital. 10. Occupational therapy consisting of range of motion exercises, strengthening exercises and prosthetic training to achieve pain relief, restoration of function, the prevention of disability or further deterioration for the following conditions: Hand and upper extremity injuries; Joint dysfunction resulting from arthritis; Post mastectomy; Burn care; Amputation. Such services must be provided by a licensed occupational therapist or licensed occupational therapist assistant,who is an employee of the Hospital. Benefits shall not be provided for any other occupational therapy services including, but not limited to: • Training to compensate for perceptual impairment; - ) Teaching and practicing the activities of daily living; Developing prevocational capacity. 11. Speech therapy when provided by a'licensed speech-language pathologist or person practicing under the direct supervision of a licensed speech-language pathologist. C. COVERED HOSPITAL OUTPATIENT SERVICES AND FREESTANDING AMBULATORY SERVICES 1. Payment will be.made for Outpatient Hospital services or services provided by a Freestanding Ambulatory Facility as identified in Section B, 2 through 8, above. For such services to be payable,they must be, in our opinion, Medically Necessary for the specific conditions being treated. 2. Payment will be made for a observation room or postoperative holding room charge, not to exceed the average cost of a semi-private room in Nebraska, for a period of one day. If an intensive care unit, cardiac care or similar type of room Medically Necessary, benefits will be based upon the reasonable charge for such room, for a period of one day. PART VI.BENEFITS FOR PHYSICIAN'S SERVICES, EXCEPT MATERNITY A. OVERVIEW: The following Physician's services are Covered Services under this Contract This means that subject to the Exclusions and Limitations set forth in Part XIII, including determinations made by our Utilization Review Program, benefits will be paid for these services when provided to a Covered Person. B. COVERED PHYSICIAN SERVICES: 1. Surgery: Operative invasive procedures and the treatment of fractures and dislocations provided by \....._r. the Physician in charge of the case, or by a certified physician's assistant within the scope of his or her 1 9836 Rev.5/1/90 - 12 - ! Y• practice. The amount payable for a surgical procedure shall include the normal preoperative and postoperative care of a Hospital Inpatient or Outpatient, or in a Freestanding Ambulatory Facility. a. When the normal preoperative or postoperative care of the Hospital Inpatient is performed by a Physician other than the person actually performing the surgical procedure, the surgeon's benefit will be limited to 60% of the amount payable for the procedure. The Physician providing the normal preoperative or post operative care shall be reimbursed up to 40%of the amount payable for the procedure. b. When multiple or bilateral surgical procedures are performed which add significant time or complexity at the same operative session, benefits shall be paid for the primary procedure as . determined by us. For any secondary procedure, benefits shall be provided at 75% of the amount payable had the procedure been primary. For any additional procedure, benefits shall be provided at 50% of the amount payable had the procedure been primary. When a surgical procedure is performed in two or more steps or stages, payment will be limited to the amount provided for a single procedure. 2. Surgical Assistance: Payment will be made for surgical assistance by a Physician or certified physician assistant who actively assists the operating physician. The amount payable will not exceed 20% of the PPO Nebraska Physician's Reimbursement Schedule amount or the Maximum Benefit Amount for the surgery,whichever is applicable. Surgical procedures.for which benefits for a surgical assistant are provided are those specifically identified by us. Such information may be obtained from us prior to surgery. 3. Anesthesia Services: The administration of an anesthetic by a Physician or a certified registered nurse anesthetist. Anesthesia services shall include the usual preoperative and postoperative visits and the administration of fluids or blood incident to the anesthesia or surgery, but shall not include administration of anesthesia by the attending or assisting surgeon (except spinal, saddle or caudal blocks) nor local infiltrations by whomsoever administered. 4. Nonsurgical Inpatient Hospital Visits: Nonsurgical Inpatient care or treatment of a condition for which surgical care is not required. 5. Concurrent Inpatient Hospital Visits: An Inpatient Hospital visit provided by two or more Physicians on the same day if, in our opinion, the services are: a. For unrelated nonsurgical medical diagnoses which require the services and skills of two or more Physicians with unrelated specialties; or b. Necessary because of medical complications requiring nonsurgical care not related to surgery and not a part of the usual, necessary and related preoperative and postoperative care and requiring supplemental skills not possessed by the attending surgeon or his or her assistants. 6. Inpatient Consultation Service: When a Covered Person is an Inpatient, payment will be made for one Physician consultation per specialty when the following requirements are met: a. Requested by the attending Physician; and b. Required by the Covered Person's Illness or Injury and beyond the special knowledge or practice specialty of the attending or other consulting Physician; and c. Consultation includes a physical examination of the Covered Person by the consulting Physician; and d. A written report from the consulting Physician is included in the Covered.Person's Hospital chart. 9836 Rev. 5/1/90 1.3� 7. Intensive Medical Service: Unusual, repeated and prolonged attendance at the Covered Person's bedside when required by the Illness or Injury. 8. Radiation Therapy. 9. Tissue Examinations: Tissue examinations in connection with surgical procedures, whether performed in a Hospital Inpatient or Outpatient facility, Freestanding Ambulatory Facility, or in the Physician's office. 10. Pap Smears. 11. Radiology and Pathology Services. 12. Physician Home,Office and Outpatient Visits: Payment will be made for such services. Included within this service is care associated with renal dialysis, not billed pursuant to another procedure. 13. Psychotherapy or psychological counseling services provided by a Physician or certified clinical psychologist or by a registered nurse, certified master social worker or licensed psychologist working under the direct supervision of a Physician or certified clinical psychologist. 14. Biofeedback procedures, up to a limit of twelve (12) per patient, per calendar year. PART VII. BENEFITS FOR MATERNITY A. Benefits shall be paid for Medically Necessary Hospital and Physician Covered Services pursuant to Parts V and VI of this Contract, when such services are provided to a Covered Person, if eligible for maternity benefits, as the result of a Pregnancy. Payment for prenatal and postnatal care is included in the payment for the delivery. B. Additional benefits will be provided for all Medically Necessary radiology and pathology porformed in a Physician's office or the Outpatient department of a Hospital. pro procedures C. Room and board for a newborn infant will be provided for as long as the mother is confined in Hospital and eligible for maternity benefits. D. Benefits for Medically Necessary Covered Services provided for a Maternity Admission must be precertified by us if such admission is to a Non-PPO Nebraska Hospital, or if delivery is by a Non-PPO Nebraska Physician. It is the Covered Person's responsibility that we be notified of the Maternity Admission. Notification to us may be made by the Physician, the Hospital,the Covered Person, or someone acting on behalf of the Covered Person. Notification may be made at any time prior to admission or within twenty-four(24) hours after admission. The Covered Person will be notified that benefits will be provided for a specific number of Medically Necessary Inpatient days. If the Covered Person wishes additional Inpatient days for either the mother or the newborn child, or both, a request for the additional benefits must also be made to us. Such request may also be made by the Physician, the Hospital, the Covered Person, or someone acting on behalf of the Covered Person. If additional days are precertified for either the mother or the newborn child, we will notify the treating Physician,the Hospital and the Covered Person that benefits will be provided for Covered Services. If the Covered Person does not request precertification, Allowable Charges considered for benefits by this Contract for all Covered Services provided during the Maternity Admission will be reduced by twenty-five percent (25%). Allowable Charges considered for benefits for all Covered Services provided during any period of a hospitalization which extends beyond the length of stay precertified by us will be reduced by twenty-five percent (25%). The Covered Person will be responsible for payment of the amount of the reduction. E. Under a Family or Single Parent Membership, at the time of birth, no Waiting Periods are applicable to newborn children requiring definitive medical or surgical treatment. i Such definitive medical or surgical treatment shall also be provided for the newborn child of a person with ara.A - Employee-Spouse Membership for thirty-one (31) days from the date of birth. To continue such coverage,the 9836 Rev.5/1/90 14 • employee must request that the Membership Unit be changed to a Family or Single-Parent Membership within such thirty-one day period by filing an Enrollment Form with us and paying the additional premium. F. The following are excluded: 1. All Physician servics provided to a newborn well infant, except circumcision; 2. Room and board or nursery care for a newborn well infant when the mother is not eligible for maternity benefits. G. Benefit payment is contingent, however, upon normal childbirth occurring, or being scheduled to occur, after 270 days of continuous Blue Cross and Blue Shield of Nebraska maternity coverage. We will consider any period during which maternity coverage was in continuous effect with us, prior to the effective date of this Contract in computing the 270-day period. H. Benefits will not be provided pursuant to this Part VII for post partum depression, psychosis or any other Mental Illness. Benefits for such conditions are provided by Part VIII, and subject to the limitations therein. PART VIII. BENEFITS FOR MENTAL ILLNESS, DRUG ADDICTION AND ALCOHOLISM Benefits will be provided to a Covered Person for Covered Services provided for treatment of Mental Illness, drug addiction or alcoholism, or any combination thereof, as follows: A. Covered Services: Covered Services for the acute care of Mental Illness, drug addiction or alcoholism, or any combination thereof, shall be those Hospital services listed in Part V, and those Physician services listed in Part VI. Benefits will not be provided for treatment modalities which are identified as Non-Covered Services in Part XIII of this Contract. • B. inpatient and Day Care: Benefits will be provided for Inpatient treatment for up to thirty(30) days per calendar year. Al! Inpatient services for Mental Illness, drug addiction or alcoholism must be precertified by us. A person shall be considered an Inpatient for this Part VIII if he or she is confined to a Hospital or to an Alcoholism or Drug Treatment Center. A person is considered confined if he or she spends less than six(6) hours daily outside of such facility at work, or school, or otherwise independent of direct facility supervision. Such benefits will not be provided.to a person who is not confined as an Inpatient but is receiving care at a Day Care or Outpatient facility. 1. Payment for Inpatient Services: a. PPO Nebraska Providers: We have contracted with the PPO Nebraska Hospital or Treatment Center for reimbursement of Covered Services at a specific rate, based upon billed charges. If a Covered Person is confined as an Inpatient in a PPO Nebraska Hospital or Alcoholism or Drug Treatment Center, payment will be made to that Hospital or Treatment Center for Covered Services. A PPO Nebraska Physician has entered into an agreement with us that he or she will accept the lesser of his or her billed charges or an amount set forth in the PPO Nebraska Physician's Reimbursement Schedule, for Covered Services listed thereon, as payment in full. If the Covered Service is not listed,the PPO Nebraska Physician has agreed to accept the lesser of his or her billed charge or the Maximum Benefit Amount as payment in full for Covered Services. PPO Nebraska Providers agree to accept our payment plus the payment by the Covered Person of any Deductible, Coinsurance, charges for Non-Covered Services and charges for Inpatient care in excess of thirty (30) days per calendar year, as payment in full. If a claim is submitted on a service which is not approved by our Utilization Review Program,the PPO Nebraska Provider agrees that it will not charge, collect or seek collection from the Covered Person or from us. 9836 Rev. 5/1/90 15 • EXCEPTION: PPO Nebraska Providers may collect from the Covered Person, however, for a specific service, procedure, drug, or supply where benefits are not payable pursuant to our Utilization Review Program if prior to the service being provided,the Provider has advised the Covered Person in writing, or verbally if documented in the medical record, that the benefits will not be payable by us. b. Non-PPO Nebraska Providers: If a Covered Person is confined as an Inpatient in a Non-PPO Nebraska Hospital or Alcoholism and Drug Treatment Center, payment will be made for Medically Necessary Covered Services based on the reasonable charge for such services. If the Covered Person receives Covered Services from a Non-PPO Nebraska Physician or other provider, benefits will be paid at the lower of billed charges or Maximum Benefit Amount. The Covered Person is responsible for the payment of the Deductible, the Coinsurance, charges for Non-Covered services, and for charges for services in excess of thirty (30) days per calendar year. In addition, the Covered Person is responsible for the payment of any amount charged by the Provider in excess of the Maximum Benefit Amount. The Coinsurance percentage is applied to the Allowable Charges, and the Coinsurance and Deductible amounts will be the Non-PPO Nebraska Coinsurance and Deductible Amounts. EXCEPTION: If the Covered Person receives Inpatient care at a Non-PPO Nebraska Hospital or Treatment Center, or receives care from a Non-PPO Nebraska Physician under the following circumstance,benefits will be paid for Medically Necessary Covered Services at the PPO Nebraska preferred Coinsurance and Deductible rate: (1) In case of a Medical Emergency. A Medical Emergency is the sudden and unexpected onset of symptoms or the exacerbation of a chronic condition which presents an acute, severe and immediate life threatening situation or a situation where delay might lead to irreparable harm. ). If the Novi-PPO Providers are participating with Blue Cross and Blue Shield of Nebraska under another Blue Cross and Blue Shield of Nebraska program, payment will be made for Covered Services pursuant to that program. These Participating Providers have agreed to accept our payment plus payment by the Covered Person of any Coinsurance, Deductible and charges for any Non-Covered Services as payment in full. C. Payment for Outpatient Services: 1. PPO Nebraska Provider: A PPO Nebraska Provider has entered into an agreement with us that he or she will accept the lower of his or her billed charge or an amount set forth in the PPO Nebraska Physician's Reimbursement Schedule for Medically Necessary Outpatient Covered Services listed thereon,as payment in full. If the Covered Service is not listed,the PPO Nebraska Provider has agreed to accept the lesser of his or her billed charge or the Maximum Benefit Amount as payment in full for Covered Services. Benefits will be paid by us for such Covered Services at 70% of the Allowable Charge. The Covered Person is responsible for payment of the Deductible, the 30% Coinsurance amount and charges for Non-Covered Services. If a claim is submitted which is not approved by our Utilization Review Program, the PPO Nebraska Provider agrees that he or she will not charge, collect or seek collection from the Covered Person, or anyone responsible for the Covered Person, or from us. EXCEPTION: The PPO Nebraska Provider may collect from the Covered Person, however, for a specific service, procedure, drug, supply or item of medical equipment where benefits are not payable pursuant to our Utilization Review Program if prior to the service being provided,that Provider has advised the Covered Person in writing, or verbally if documented in the medical record, that the benefits will not be payable by us and the Covered Person has agreed to be responsible for reimbursement to the Physician. 9836 Rev. 5/1/90 16 2. Non-PPO Nebraska Provider. If a Covered Person receives Medically Necessary Covered Services from a Non-PPO Nebraska Provider, benefit payment will be based on the lesser of the Provider's billed charges or Maximum Benefit Amount. Benefits will be paid by us for such Covered Services at fifty percent (50%) of the Allowable Charge. The Covered Person is responsible for payment of the Deductible, the 50% Coinsurance amount, any amount in excess of the Maximum Benefit Amount, and any charges for Non-Covered Services. D. THIS CONTRACT DOES NOT PROVIDE BASIC COVERAGE FOR ALCOHOUSM,AS DEFINED IN SECTIONS 44-769 TO 44-781, R.R.S. 1943. SUCH COVERAGE FOR THE TREATMENT OF ALCOHOUSM IS AVAILABLE IF YOU SPECIFICALLY REQUEST IT,AND THEN ONLY UPON SUCH TERMS AND CONDITIONS AS WE CAN AGREE WITH YOU TO PROVIDE. PART IX. BENEFITS FOR ORAL SURGERY AND DENTISTRY A. Benefits will be provided pursuant to Part IV for the following Covered Services, if performed by a Physician or dentist: 1. The removal of impacted teeth in a Provider's office, Freestanding Ambulatory Facility or Hospital Outpatient department; 2. Incision and drainage of cellulitis; 3. Excision of exostoses,tumors and cysts,whether or not related to the temporomandibular joint of the jaw; • 4. Invasive surgical procedures of the jaw or the temporomandibular joint.of the jaw; 5. Bone grafts to the jaw except those done to prepare the mouth for dentures, or for periodontal purposes; 6. Reduction of a complete dislocation or fracture of the temporomandibular joint of the jaw required as a direct result of an accidental Injury occurring while the patient was a Covered Person under this Contract. Benefits for such services are limited, however,to services provided within twelve (12) months of the date of Injury. Benefits shall not be provided for such services when the dislocation or fracture occurs at the result of eating, biting or chewing; 7. Services, supplies or appliances for dental treatment of natural teeth required as the direct result of an accidental injury occurring while this Contract is in effect. Benefits for such services are limited, however, to services provided within twelve (1.2) months of the date of Injury, or unless otherwise preauthorized by us. Benefits shall not be provided for such services when the Injury occurs as the result of eating, biting or chewing; 8. Osteotomies performed for a gross congenital abnormality of the jaw which cannot be treated by orthodontic appliances and orthodontic treatment; and 9. Hospiital Inpatient charges related to Covered Services for oral surgery and dentistry, if Medically Necessary as determined by us. In addition, benefits for Hospital Inpatient charges will be provided if the Hospital admission is essential to safeguard the health of the patient because of the existence of a specific non-dental physical organic impairment. Prior to hospitalization, a Covered Person may request a determination of benefits by submitting to us a written statement from the Physician or dentist. B. EXCLUSIONS: No payments shall be made under this Part IX, or under any other part of this Contract, except for services expressly described in paragraph A, above,for: 1. Care in connection with the treatment, filling, removal, repositioning or replacement of teeth; 2. Root canal therapy or care; 9836 Rev. 5/1/90 17 �' • 3. Preparation of the mouth for dentures; 4. Treatment of the dental occlusion or temporomandibular joint of the jaw by any means or for any reason, except as described in Paragraph A4 and A6 of this Part IX. No benefits will be provided for any other treatment of Temporomandibular Joint (TMJ) Syndrome. 5. All other procedures involving the teeth or structures directly related to or supporting the teeth, including: a the gums; b. the alveolar processes;and c. temporomandibular joint of the jaw. PART X. BENEFITS FOR ORGAN TRANSPLANTS A BENEFITS FOR THE COVERED PERSON WHO IS A RECIPIENT OR DONOR: 1. Benefits will be provided for the following Medically Necessary Covered Services: a. Medical, and surgical services, pursuant to Part VI; b. Hospital services pursuant to PartV; , c. Durable Medical Equipment pursuant to Part XI; d. Prescription medication pursuant to Part XI; directly related to, or resulting from, a transplant of the following body organs: (1) Liver; (2) Heart; (3) Heart-Lung; or (4) Pancreas; where the recipient or donor of the organ is a Covered Person. 2. Benefits will be provided for transportation to and from the site of the transplant procedure for the Covered Person. Such benefits will be limited to the reasonable cost of land or commercial air transportation. 3.Additional Benefits-Donation of Organs: Benefits up to$10,000 will be provided for Medically Necessary Covered Services directly related to, or resulting from, the above transplant procedures for the following: a Hospital, medical, surgical or other Covered Services provided to Non-Covered Person donors; b. Services provided for the evaluation of organs including, but not limited to, the determination of tissue matches; c. Services provided for the removal of organs from nonliving donors; I 9836 Rev.5/1/90 18 d. Services provided for the transportation and storage of donated organs. Benefits provided to Non-Covered persons shall be secondary to benefits provided to those persons pursuant to their own hospital, medical, surgical, or major medical coverage. 4. Benefits for kidney transplant services will be provided pursuant to Medicare guidelines. B. EXCLUSIONS AND LIMITATIONS: Benefits provided by this Part X will also be subject to the specific limitations set forth herein. • 1.Transplant Benefit Period Limitation: The Transplant Benefit Period is defined as the period from five days immediately prior to, and one year immediately following,the transplant procedure (370 days). Benefits will be provided for only one transplant procedure during the Transplant Benefit Period. 2. Purchased Organs: Benefits will not be provided for the purchase of human organs which are sold rather than donated to the recipient. 3. Non-Human or Artificial/Mechanical Organs: Benefits will'not be provided for transplantation of any nonhuman organ to a human recipient, or the implantation of an artificial/mechanical organ into a human recipient. This provision does hot apply to the implantation of pacemakers. C. PREAUTHORIZATION: All benefit payments for organ transplant procedures must be preauthorized by us in writing. Preauthorization shall be initiated by the Covered Person, in writing, to us requesting that benefits be paid for an organ transplant procedure. This request must be rrtade before the procedure is performed, and be accompanied by documentation from the Covered Person's Physician demonstrating the Medical Necessity of the proposed transplant. This request should also indicate at what hospital the transplant procedure will be performed. This written request should be directed to: Medical Support Department Blue Cross and Blue Shield of Nebraska P.O. Box 3248 Omaha, Nebraska 68180-0001 We will respond in writing advising the Covered Person as to whether benefits are available. BENEFITS WILL BE REDUCED BY 20% FOR THE ORGAN TRANSPLANT PROCEDURES USTED IN THIS PART X IF SUCH PROCEDURES ARE NOT PREAUTHORIZED. PART XI. BENEFITS FOR HOME HEALTH AIDE AND HOSPICE SERVICES A. HOME HEALTH AIDE: Benefits will be paid pursuant to Part IV for Medically Necessary Home Health Aide Services provided in lieu of hospitalization by a licensed or Medicare-certified Home Health Agency. 1. Home Health Aide Services shall mean personal care services provided to the Covered Person that relate to the treatment of his or her medical condition. Such services include, but are not limited to bathing,feeding and performing household cleaning duties directly related to the Covered Person. Such services must be ordered by a Physician,and performed under the supervision of a registered nurse. B. HOSPICE SERVICES: Benefits will be paid for Medically Necessary Hospice Services provided primarily in the Covered Person's home by a Medicare-certified or Joint Commission on Accreditation of Health Care Organization accredited Hospice. A Hospice is a program of care provided for persons diagnosed as terminally ill, and their families. Benefits are subject to the following requirements: 1. The Covered Person must have a life expectancy of six (6) months or less; 2. The Hospice Services must be ordered by a Physician; 9836 Rev.5/1/90 19 • 3. Those services provided must be appropriate for palliative support, treatment or management of terminal Illness. Hospice Services include the following: 1. Home Health Aide Services; 2. Respite Care: Short-term Inpatient care which is necessary for the Covered Person in order to give temporary relief to the person who regularly assists with the care at home. Respite Care must be provided in a skilled or intermediate"care nursing facility that is affiliated with the Hospice that is providing services to the Covered Person. Respite Care in a skilled or intermediate care nursing facility need not meet the Company's normal Medical Necessity criteria ordinarily applied to Inpatient admissions; 3. Medical Social Services: Services provided by a medical social worker employed by the Hospice, directly related to the Covered Person's medical condition; 4. Crisis Care: Extended skilled nursing care provided at the home of the Covered Person for up to twenty-four(24) hours per day. Benefits will be available for such care if provided in lieu of a Medically Necessary Inpatient hospitalization; 5. Bereavement Counseling: Up to five (5) one hour counseling sessions provided to a Covered Person who is a family member of the deceased Covered Person who was the recipient of Hospice Services, provided within six (6) months of the death. C. EXCLUSIONS AND LIMITATIONS: Benefits payable for Home Health Aide Services and Hospice Services, are subject to the maximum benefits stated for the Contract. Benefits payable for Home Health Aide Services and Hospice Services are subject to the following additional limitations: 1. Home Health Aide Services may not exceed maximum benefits of$10,000; 2. Hospice Respite Care Services may not exceed a maximum of ten (10) days; 3. Hospice Medical Social Services may not exceed a maximum of eight (8) one-hour sessions; • 4. Hospice Crisis Care Services may not exceed a maximum of fifteen (15) days; In addition to the Contract Exclusions found in Part XIII, benefits will not be provided for: 1. Services performed by volunteers; 2. Pastoral services, or legal or financial counseling services; 3. Services which are primarily for the convenience of the patient, or a person other than the patient; 4. Home delivered meals; 5. Any maintenance therapy for non-hospice related Home Health Aide Services, which is therapy not designed to improve the Covered Person's condition; or 6. Services for Mental Illness or psychiatric care. PART XII. BENEFITS FOR OTHER COVERED SERVICES AND SUPPLIES A. COVERED SERVICES AND SUPPLIES: The benefits paid pursuant to this Part XII will be subject to the / appropriate Deductible based on the Provider's PPO status. Benefits will be paid at 80% (unless otherwise " stated in the Master Group Application) of billed charges for the following Medically Necessary Covered 1, Services and supplies when not covered elsewhere under this Contract: 9836 Rev.5/1/90 20 1. Oxygen and equipment for its administration and inhalation therapy. 2. Ambulance service to the nearest facility where the Covered Person may receive appropriate care for a Medical Emergency. 3. Up to sixty (60) Outpatient physical therapy sessions per year provided by a licensed physical therapist or other qualified person under the direct supervision of a Physician. A session is defined as a visit to the physical therapist not to exceed four(4) hours per day. 4. Up to sixty (60) Outpatient occupational therapy sessions per year consisting of range of motion exercises, strengthening exercises, and prosthetic training to achieve pain relief, restoration of function, the prevention of disability or further deterioration for the following conditions: • Hand and upper extremity injuries; • Joint dysfunction resulting from arthritis; • Post mastectomy; Burn care; Amputation. Such services must be provided by a licensed occupational therapist or licensed occupational therapist assistant, under the direct supervision of a Physician. A session is defined as a visit to the occupational therapist not to exceed four (4) hours per day. Benefits shall not be provided for any other occupational therapy services including, hut not limited to: Perceptual training to compensate for perceptual impairment; . Teaching and practicing the activities of daily living; Developing prevocational capacity. 5. Speech therapy when related to a cerebral vascular accident, closed head-trauma, a cerebral tumor, external trauma, or when the patient has had a laryngectomy. Such services must be provided by a licensed speech-language pathologist or person practicing under the direct supervision of a licensed speech-language pathologist. 6. Rental or initial purchase,whichever is least costly, of certain items of Durable Medical Equipment when prescribed by a Physician. We may preauthorize a second or subsequent purchase of an item of Durable Medical Equipment, if such purchase is made necessary by a significant change in the Covered Person's condition or in the case of the growth of a child who is an Eligible Dependent. Benefits will not be provided for the repair, maintenance or adjustment of Durable Medical Equipment or for sales tax on the purchase thereof. Benefits will not be provided for Durable Medical Equipment rented, purchased from or used while confined in a Hospital, a skilled nursing facility, an intermediate care facility, or a nursing home or any other licensed residential facility if such equipment is usually supplied by such facility. 7. Any medicinal preparation which: a. by law requires a Physician's or dentist's prescription or order and must bear the legend: Caution- -Federal law prohibits dispensing without a prescription; b. is dispensed by a registered pharmacist on the prescription or order of a Physician or dentist; and �} 9836 Rev. 5/1/90 21 c. may lawfully be dispensed by a registered pharmacist in the State of Nebraska. 8. Insulin. 9. Routine immunizations. 10. Allergy tests and injections of allergy extracts. 11. One set of eyeglasses or contact lenses or replacement of one set of eyeglasses or contact lenses, because of a change in prescription of at least one diopter as a direct result of intraocular surgery or ocular Injury, if ordered by a Physician. 12. Nursing care in the Covered Person's home,which requires the skill, proficiency and training of a registered nurse (R.N.) or a licensed practical nurse (LP.N.), for not more than three (3) hours per day, to the following: subject9 a the care must be ordered by a Physician; b. the care must not be primarily for the convenience of the patient or the patient's family; c. time spent bathing, feeding,transporting, exercising or moving the patient, giving oral medication or acting as a companion or sitter or homemaking,will not be considered for benefit payment under this provision; d. the care must not be provided by a nurse who is an immediate relative by blood, marriage or adoption, or a member of the Covered Person's household; e. the patient must be physically unable to be transported to receive medical care; f. the care must not be provided in a Hospital, a skilled nursing facility, an intermediate care facility, a residential care facility or a domiciliary facility. 13. Renal Dialysis: Services for renal dialysis including all charges for home dialysis equipment and disposable supplies. Benefits will also be provided for one session of dialysis training or counseling. We will be primary for a maximum of fifteen (15) months or until Medicare assumes primary responsibility for benefits. 14. Cardiac Rehabilitation Program: Cardiac Rehabilitation isdefined as the use of various modalities of treatment to improve cardiac function-as well as tissue perfusion and oxygenation through which selected patients are restored to and maintained at either a pre-illness level of activity or a new and appropriate level of adjustment. a. Benefit Provision: (1) Benefits will be provided for up to six weeks each calendar year for Hospital Outpatient Cardiac Rehabilitation Program Services, for up to three (3) sessions per week. (2) Covered Hospital Services: All services defined as Covered Services for Outpatient care by Part V of this Contract. In addition to such services, the following shall be Covered Services when provided as part of the Cardiac Rehabilitation Program and reimbursed at the Hospital's Maximum Benefit Amount: (a) Initial cardiac rehabilitation evaluation; (b) Exercise sessions; (c) Concurrent monitoring during the exercise session for high risk patients. 9836 Rev. 5/1/90 22 - I (3) Covered Physician Services: All Covered Physician Services as defined by Part VI which are provided to an Outpatient (4) No coverage will be provided for: (a) Diet or dietetic instructions; (b) Smoking cessation classes; (c) Medication instruction; (d)Weight control and/or instruction; (e) Recreational therapy, educational therapy, or forms of non-medical self-care or self-help therapy; (f) Environmental control items such as air conditioners and dehumidifiers. b. Covered Person Eligibility: Covered Persons will be eligible for the benefits provided by this paragraph 14, iif they meet the following criteria: (1) Diagnoses: Services will be provided after the following: (a)An acute myocardial infarction during the preceding twelve months; } (b) Coronary bypass surgery. (2) The patient's condition must be such that Cardiac Rehabilitation can only be carried out safely under the direct, continuing supervi;;ion of a Physician and in a controlled hospital environment. c. Cardiac Rehabilitation Program-Qualifications: (1) The Cardiac Rehabilitation Program must be accredited by the Joint Commission on the Accreditation of Health Care Organizations. 15. Physical Rehabilitation Program: Physical Rehabilitation is defined as the restoration of a person who was totally disabled as the result of an Illness or Injury to a level of function which allows that person to live as independently as possible. A person is totally disabled when such person has physical disabilities and needs active assistance to perform the normal activities of daily living, such as eating, dressing, personal hygiene, ambulation and changing body position. a. Benefit Provisions: Benefits will be provided for up to sixty (60) Inpatient days per calendar year for Covered Services as defined by this paragraph 15. Such benefits may be preauthorized as set forth in paragraph f. The Provider must meet the requirements of the Physical Rehabilitation Program, as defined herein. b. Covered Hospital Services: All services defined as Covered Services for inpatient care by Part V of this Contract. In addition to such services,the following shall be Covered Services when provided as part of the Physical Rehabilitation Program: (1) Recreational therapy; (2) Social service counseling; (3) Prosthetic devices and fitting; �:. 9836 Rev. 5/1/90 23 - � (4) Psychological testing. c. Covered Physician Services: All Covered Physician Services as defined by Part VI which are provided to an Inpatient. d. Covered Person Eligibility: Covered Persons will be eligible for the benefits provided by this paragraph 15, iif they are totally disabled and meet the following criteria: (1) Diagnosis: Services will be provided for patients who are totally disabled and who meet defined specifications for coverage as determined by us. (2) The Covered Person must have intense daily involvement in two or more of the following treatment modalities: (a) Physical therapy; (b) Occupational thera py; (c) Speech therapy. (3) Inpatient rehabilitation must immediately follow an acute hospitalization. (4) Benefits for further rehabilitation will stop when: (a) further progress toward the established rehabilitation goal is minimalunlikely; or unl i,cely; (b) such progress can be achieved in a less intensive setting; (c) treatment could be continued on an Outpatient basis. e. Provider Requirements: For benefits to be available for a Physical Rehabilitation Program, the Provider must be accredited by the Committee on the Accreditation of Rehabilitation Facilities (CARE), or otherwise approved by us. f. Preauthorization Procedure: Benefits may be preauthorized. Preauthorization occurs as follows: (1) Initial Preauthorization:A Notice of Admission form may be completed and submitted by the Hospital or Provider to us prior to or within five (5) days of the date of admission to the Program. initial approval will be limited to a maximum of thirty (30) days. The history and physical, Physician's orders and progress notes, nurses' notes, and therapy notes are to be submitted with the Notice of Admission. If the admission is not approved by us, benefits may not be provided for those days prior to the receipt of the Notice of Admission. (2) Extension of Benefits: After the initial approval, requests for an extension of benefits must be submitted by the Hospital or Provider to us every fifteen (15) days. Subsequent approvals are limited to a maximum of fifteen (15) days. The Physician's orders and progress notes, nurses' notes,therapynotes, and therequest for an extension of benefits are to be submitted prior to or not later than the day through which benefits have been approved. If the extension request is not received on a timely basis and the extension is not approved by us, benefits will not be guaranteed beyond the previous approval date. We will notify the Provider by telephone and in writing about the initial approval or disapproval of coverage, as well as any subsequent approval or disapproval for an extension of benefits. We will notify the Covered Person in writing about the initial decision and any subsequent approval or disapproval. If benefits are not preauthorized, claims for such benefits may be denied if the Covered 9836 Rev. 5/1/90 24 Person's condition or the program does not meet the criteria established by this paragraph 15 for a Physical Rehabilitation Program. PART XIII. EXCLUSIONS AND LIMITATIONS A. Benefits are not provided by this Contract for the following: 1. Services not specifically covered by this Contract, nor amounts above charges for Covered Services. If a Non-Covered Service is provided to a Covered Person,the responsibility for payment rests with the Covered Person. Non-Covered Services include, but are not limited to any service for, or related to: a. Audiological examinations; audiant bone conductors; or hearing aids and their fitting; b. Blood, blood plasma or blood derivatives or fractionates, or services by or for blood donors, except administrative charges for blood furnished to a Hospital by the American Red Cross or a county blood bank and used for a Covered Person; c. Cosmetic or restorative surgery unless required as a result of an Illness or Injury occurring after the effective date of coverage; d. Detection or correction by manual or mechanical means of structural imbalance, distortion, or . subluxation in the human body for the purpose of removing nerve interference and its effects where it is the result of or related to distortion, misalignment or subluxation of or in the vertebral column; e. Eye examinations, eye refractions, eyeglasses or contact lenses, eye exercises or visual training (orthoptics) except as allowed by Part XII, paragraph 11; f. Hospital or Physician charges for standby availability; g. Personal expenses while hospitalized, such as guest meals, TV rental and barber services; h. Routine or periodic examinations, regardless of age, including well baby care; i. Custodial care; j. Treatment primarily for obesity or for weight reduction, regardless of diagnosis, except surgical operations; k. Therapy which is primarily of recreational or educational nature, or forms of nonmedical self-care or self-help training, and any related diagnostic testing; I. Treatment or removal of corns,callosities, or the cutting or trimming of nails; m. Fertility testing and related services; artificial insemination; in vitro fertilization; and embryo transfer services; n. Interest, sales or other taxes on Covered Services, drugs, supplies or Durable Medical Equipment; o. Charges made for filling out claim forms or furnishing any other records or information; p. Charges made while the patient is temporarily out of the Hospital; q. Psychological counseling services provided by persons other than Physicians or certified clinical psychologists, or registered nurses, certified master social workers or licensed psychologists working under the direct supervision of a Physician or certified clinical psychologist; 9836 Rev. 5/1/90 25 r. Marital, family or similar counseling service or educational service; s. Lodging or travel, even though prescribed by a Physician for the purpose of obtaining medical treatment, except for ambulance services as provided herein and travel benefits as provided for under Part X, Organ Transplants; t. Repairs, maintenance or adjustment of Durable Medical Equipment; u. Services or care for mental retardation; v. Music therapy or cognitive therapy; w. Nutrition care or supplements. 2. Services not considered by us to be payable after review through our Utilization Review Program. Our Utilization Review Program consists of evaluating the use.of a medical or surgical procedure or service or the utilization of medical supplies, drugs or Durable Medical Equipment, compared to established criteria, to determine whether benefits are payable. Benefits will not be provided for services, procedures, drugs, supplies or Durable Medical Equipment,which are determined by our Utilization Review Program not to be Medically Necessary, nor for any related service. If we make final determination of a claim through our Utilization Review Program that a Covered Service was not Medically Necessary, a PPO Nebraska Hospital, PPO Nebraska Physician, or other PPO Nebraska Provider agrees not to charge, collect or seek collection from a Covered Person, or anyone responsible for a Covered Person. If we make final determination of a claim through our Utilization Review Program, that a Covered Service was not payable, we will not provide benefits for that service or any related service. If the service was provided by a Non-PPO Nebraska Provider and that Provider is not participating in another Blue Cross and Blue Shield of Nebraska program, the expense of that service will be the responsibility of the Covered Person. Furthermore, the cost of that service will not be considered when we compute the Maximum Coinsurance Liability of the Covered Person. 3. Benefits will not be provided for services and procedures and any drugs, supplies, or Durable Medical Equipment which are considered to be Investigative, nor for any related.service. 4. Benefits will not be provided for services and procedures and any drugs, supplies or Durable Medical Equipment which are considered to be for Cosmetic purposes, nor for any related service. 5. Benefits will not be provided for services and procedures, and any drugs, supplies or Durable Medical Equipment which are considered by us to be obsolete, nor for any related service. Procedures will be considered to be obsolete when such procedures have been superseded by more efficacious treatment procedures, and are no longer considered effective in clinical medicine. 6. Services provided to or for: a Any dependent of an employee who has a Single Membership; b. Any person who does not qualify as an Eligible Dependent; c. Any Covered Person before the effective date of coverage or for a claim for services provided after the effective date of cancellation or termination; d. Any Covered Person for any condition for which coverage has not yet become effective because;\ l of any Contract Waiting Periods. 9836 Rev.5/1/90 26 7. Services for Illness or Injury caused directly or indirectly by war or any act of war, declared or undeclared, or sustained while performing military service. 8. Services provided in or by: (1) a Veterans Administration Hospital where the care is for a condition related to military service; or (2) any Hospital or other institution which is owned, operated or controlled by any government agency or hospital authorities, except where care is provided to non-active duty beneficiaries in military medical facilities. 9. Services available at government expense,whether or not such benefits are elected, except as follows: a. With respect to persons entitled for Medicare Part A and eligible for Part B benefits, our obligation to provide benefits will be reduced by the amount of payment or benefits such person receives from Medicare. This provision will not apply if the person is still actively at work, and has elected us as the primary carrier, except as applied to services provided for renal dialysis and kidney transplant services. • b. With respect to persons eligible for benefits under any other government program except Medicaid, whether or not the person is enrolled, our obligation to provide benefits will be reduced by the amount of payments a Covered Person is eligible for under such program; all such payments and benefits shall be charged against the maximum benefit payments as if such benefits had been provided by this Contract. 10. Services to the extent they are not payable under this Contract because of the application of Part XV, Coordination of Benefits. - 11. Services for which there is no legal obligation to pay, or for which no charge would be made if this coverage did not exist. Any charge above the charge that would have been made if no coverage existed; any service which is normally furnished without charge; or, any service which is not actually provided, shall be treated as services for which there is no legal obligation to pay. 12. Services covered under any Workers'Compensation or Employers' Liability Law, whether or not the Covered Person asserts rights to such coverage. 13. Charges for services provided by a person who is a member of the Covered Person's immediate family by blood, marriage or adoption. 14. Charges for services by a health care provider which are not within his or her scope of practice. 15. Charges in excess of the Maximum Benefit Amount. 16. Charges made separately for services, supplies and material when such services, supplies and materials are considered by us to be included within the charge for a total service payable under this Contract. 17. Services provided by a person,firm or corporation who has not obtained a certificate of need, as required by an applicable certificate of need law. 18. Services not specifically covered, but provided because of Hospital accreditation requirements or Hospital staff rules or regulations. 19. Services required by an employer as a condition of employment including, but not limited to immunizations, work physicals and drug tests. 20. An employee or other Eligible Dependent with another Blue Cross and Blue Shield coverage shall be limited to payment for not more than 100%of the Allowable Charge. 21. Equipment for purifying, heating, cooling or otherwise treating air or water. 9836 Rev.5/1/90 27 • 22. The building or remodeling of a residence. 23. The purchasing or customizing of vans or other vehicles. 24. Orthotic devices. B. Subject to all other conditions of this Contract, limited benefits are provided for. 1. Oral Surgery and Dentistry (Part IX). 2. Mental Illness, Drug Addiction and Alcoholism (Part VIII). 3. Whole Organ Transplants (Part X). 4. Home Health Aide and Hospice Services (Part XI). 5. Eyeglasses or contact lenses (Part XII). PART XIV. PROCEDURES FOR FILING A CLAIM A. Notice of Claim/Proof of Loss: A Covered Person must notify us when they have received health care services for which this Contract will pay benefits. This notice is called a claim. The claim must give us written proof of the services provided. The claim may be filed directly by the Covered Person, or the Hospital, the Physician or whoever provided the service. If the service is provided by a PPO Nebraska Physician, or PPO Nebraska Hospital, or another PPO Nebraska Provider, the claim will be filed by them. To process a claim,we must always have the employee's Identification Number and an itemized statement from whoever provided the care describing the service and showing the amount charged. We are entitled to any additional information needed to process the claim. B. Time Limit for Filing a Claim: A claim should be filed within ninety (90) days of the time the services are provided, or as soon thereafter as is reasonably possible. If the employee does not file a claim within eighteen (18) months of the date of service,and it was reasonably possible to do so, benefits will not be paid. IT IS SUGGESTED THAT ALL CLAIMS BE FILED WITH US AS SOON AS POSSIBLE AFTER EXPENSES ARE INCURRED. PPO NEBRASKA PROVIDERS WILL FILE CLAIMS WITHIN SIXTY (60) DAYS. C. Claims should be sent to: Blue Cross and Blue Shield of Nebraska P.O. Box 3248 Omaha, Nebraska 68180-0001 PART XV. COORDINATION OF BENEFITS A. This Part limits duplication of benefits for Allowable Expenses so that the total Plan(s) benefits for Allowable Expenses shall not exceed those expenses. B. Within this Part,the following definitions apply. 1. Allowable Expense: Any necessary, reasonable and customary item of expense covered in whole or in part by this Plan or another Plan during a Claim Determination Period. When benefits are in the form of services rather than cash payments, the reasonable cash value of each service shall be both an Allowable Expense and a benefit paid. Benefits payable under a Plan include the benefits that would have been payable had a claim been made. Items of expense under coverages such as dental care, vision care, prescription drug, or hearing aid programs are excluded from this definition. 9836 Rev.5/1/90 28 2. Automobile No-fault Contracts: Insurance under which benefits are payable by the Insurer for expenses of Hospital and medical care of Injuries resulting from an automobile accident regardless of negligence. 3. Claim Determination Period: The period of a calendar year over which Allowable Expenses are compared with total benefits in the absence of this provision. However, it does not include any part of a year during which a person has no coverage under this Plan, or any part of a year before the date this Coordination of Benefits provision or a similar provision takes effect. 4. Insurer: An insurance company, a health maintenance organization, a preferred provider organization, a dental service corporation, or a nonprofit hospital service corporation. 5. Plan: Any Plan providing benefits or services for or by reason of medical or dental care or treatment, which benefits are provided by: a Group, blanket or franchise insurance coverage; b. Uninsured arrangements of group or group-type coverage; c. Any coverage under labor management trustee plans, union welfare plans, employer organization plans, or employee benefit organization plans; d. Hospital indemnity type coverages written on a non-expense incurred basis to the extent the benefits available are more than$100.00 per day; e. Both group and individual Automobile No-fault Contracts; f. Group or group-type coverage through HMOs and other prepayment, group practice and individual practice plans. Plan does not include: g. Grammar school, high school, or college accident-type coverages,written on either an individual, group, blanket, or franchise basis; h. Individually underwritten and issued Hospital, Expense or Dread Disease policies; i. Hospital Indemnity Type Coverages written on anon-expense basis to the extent the benefits available are equal to, or less than, $10G per day; j. Non-Group Individual or Family insurance or subscriber contracts; ' k. Non-Group Individual or Family coverage through Health Maintenance Organizations; I. Non-Group Individual or Family coverage under other prepayment, group practice or individual practice plans. m. Plans whose benefits, by law,are in excess to those of any private insurance program or other nongovernmental program. 6. Primary Plan: The Plan which will determine allowable benefits without regard to other covered Allowable Expenses. 7. Secondary Plan: The Plan which will determine allowable benefits for the balance of the remaining charges in the Claim Determination Period. 9836 Rev.5/1/90 29 • 8. Primary Plan/Secondary Plan: The order of benefit determination rules state whether this Plan is a Primary Plan or Secondary Plan as to another Plan covering the person. a. When this Plan is a Primary Plan, its benefits are determined before those of the other Plan and without considering the other Plan's benefits; b. When this Plan is a Secondary Plan, its benefits are determined after those of the other Plan and may be reduced because of the other Plan's benefits; c. When there are more than two Plans covering the person, this Plan may be a Primary Plan as to one or more other Plans, and may be a Secondary Plan as to a different Plan or Plans. C. Order of Benefits: 1. If benefits are payable under any other Plan or No-Fault Automobile Insurance coverage which does not provide for Coordination of Benefits, the insurer providing such other coverage will be the Primary Carrier. 2. Whenever the benefits payable under any other Plan are determined with regard to the benefits payable under this Contract, then the Primary Carrier will be the organization which is the only one which satisfied the first one of the following tests by providing a Plan to the Covered Person: a. as an employee (other than as a dependent); b. as a child of the parent where the parents are not separated or divorced whose birthday falls • earlier in the year. Where both parents have the same birthday,the Primary Carrier will be the one which covered the parent for the longer period of time. However, if the other Plan does not have this rule, but instead has a rule based on gender,the rule in the other Plan will determine who is the Primary Carrier. c. as a child of the custodial parent where the parents are divorced or separated, then as the child of the spouse of the parent with custody and then as a child of the parent not having custody. However, if there is actual knowledge that the divorce decree requires one parent to be responsible for health care expenses,the Primary Carrier will be the Plan provided by that parent; d. as an employee who is neither laid off nor retired (or as that employee's dependent) before those of the Carrier which covers that person as a laid off or retired employee (or that employee's dependent). If the other Health Benefit Coverage does not have this provision and, if as a result,the Carriers do not agree on the order of benefits,this section is ignored. e. a COBRA beneficiary who is continuing coverage in accord with federal law. f. if none of the above rules determines the order of benefits, the benefits of the Plan which covered an employee or subscriber longer are determined before those of the Plan which covered that person for the shorter time. D. To properly administer this Part,we may obtain from or release to any insurance company or other organization or person, any information necessary to determine whether this Part or any similar Part in any other Contract applies. Any person who claims benefits under this Contract agrees to furnish the Plan information that may be necessary to effect Coordination of Benefits. E. If another Plan makes payment which we should have made, then we have the right to pay to such other Plan any amounts determined to be necessary. Amounts paid to other Plans in this manner will be considered benefits paid hereunder. This Plan is discharged from liability hereunder to the extent of any amounts so paid. C' V F. If we make larger payments than necessary, then we have the right to recover any excess from any insurer, any other organization, or any person to or for whom such payments were made, including the employee. _. 9836 Rev.5/1/90 30 G. The Plan's duty hereunder is limited to making a reasonable effort to avoid liability as the Primary Plan in appropriate cases brought to its attention;to making reasonable efforts to compute the amount payable under any other Plan; and to making reasonable efforts to recover any excess payments made by it. H. If this Plan is the Secondary Plan, benefits under this Plan must be computed as if this provision does not exist. After calculating the benefits as though other coverage did not exist, this Plan may reduce its benefits so that the total benefits paid or provided by all Plans during a Claim Determination Period are not more than total Allowable Expenses. The amount by which this Plan's benefits has been reduced will be used by us to pay Allowable Expenses, not otherwise paid,which were incurred during the Claim Determination Period by the Person for whom the claim is made. As each claim is submitted, this Plan determines its obligation to pay for Allowable Expenses based on all claims which were submitted up to that point in time during the Claim Determination Period. • I. If this Plan is the Primary Plan,there will be no reduction of benefits under this Part. PART XVI. SUBROGATION A. Subrogation is our limited right to recover benefits paid for Covered Services provided as the result of Injury or Illness which was willfully or negligently caused by another person. If we pay benefits for Covered Services provided to a Covered Person as the result of an Injury or Illness,we are allowed to be reimbursed the amount paid for such services by the Covered Person if the Covered Person or the person who has a right to recover for a Covered Person (usually a parent or spouse), recovers the cost of such services from the person who caused the Injury or Illness or from that person's liability insurance carrier. B. The Covered Person agrees to assist us in any way necessary to recover such payments. The Covered Person agrees not to interrupt or prejudice our right to recover. C. If the Covered Person refuses or fails to comply with this Part,we can cancel coverage, including that of any. covered dependents. D. Subrogation does not apply to recoveries made by Covered Persons from No-Fault Insurance. Recoveries made by the Covered Person from No-Fault insurance are subject to Coordination of Benefits (Part XV). PART XVII. WORKERS' COMPENSATION Benefits for services provided as the result of Illness or Injury arising out of employment for which an employer is required to furnish or pay for, pursuant to Workers' Compensation laws, are not payable under this Contract. (See Part XIII, Exclusion Number 12. .In certain instances, benefits for such services are paid in error under this Contract. If we pay for such services,we are entitled to reimbursement for such payments from the Covered Person. This reimbursement may be funded from any recovery made from the employer, or the employer's Workers' Compensation carrier. PART XVIII. STANDARD PROVISIONS A. CERTAIN DEFENSES: All statements, in the absence of fraud, made by you or the Covered Person will be deemed representations and not warranties. No such statements will void coverage or reduce the Contract benefits unless contained in the attached Application or the employee's Enrollment Form filed with us. B. LEGAL ACTIONS: The employee cannot bring a legal action to recover under the Contract for at least sixty (60) days after written proof of loss is given to us. The employee cannot start a legal action after three (3) years from the date written proof of loss is required. C. ADDRESSES FOR NOTICE: Our address is 7261 Mercy Road, Omaha, Nebraska, 68180-0001. The Covered Person's address is the most recent address appearing on our records. Your address is the address shown on the application. 9836 Rev. 5/1/90 • 31 D. CHANGE OF OCCUPATION: No change in coverage will be made if the employee or any Eligible Dependent changes occupations except as stated in the eligibility provision on unmarried children attending school. �.l E. CONFORMITY WITH STATUTES: Any Contract provision which does not conform with the laws of Nebraska or the United States is hereby amended to conform. F. TIME OMIT ON CERTAIN DEFENSES: After two (2) years from the Contract effective date, no misstatements, except fraudulent misstatements made in the Contract application will be used to void the • Contract or deny a claim for loss incurred after the expiration of such two (2) year period. No claim for loss that starts more than two (2) years after the Contract effective date will be reduced or denied on the grounds that a condition not excluded from coverage existed prior to the effective date of the Contract. G. INTERPRETATION AND DETERMINATION OF BENEFITS: If a group is self-funded or partially self- funded, Group Applicant grants to Blue Cross and Blue Shield of Nebraska discretionary authority to determine eligibility for benefits and to construe and interpret the terms of the Plan, consistent with the terms of this document. The decisions of Blue Cross and Blue Shield of Nebraska shall be final and binding subject to appeal to Blue Cross and Blue Shield of Nebraska under its review process. Benefits will be paid or denied consistent with the Benefit Plan based on this determination. PART XIX. DEFINITIONS • The definitions contained in this glossary are of terms used in this Contract. Alcoholism or Drug Treatment Center: A facility licensed by the Department of Health as an Alcoholism or Drug Treatment Center which is not licensed as a Hospital, and which is used to provide residential care, t,eatment, services, maintenance, accommodation or board in a group setting primarily and exclusively for individuals having a dependency or addiction to the use of alcohol or drugs. • Allowable Charge: The Allowable Charge for Covered Services provided by a Hospital or other licensed facility is the DRG amount or the billed charge. The Allowable Charge for a Covered Service provided by a Physician or other licensed professional provider is the lesser of the billed charge, the Reimbursement Schedule amount if by a PPO Nebraska Physician, or the Maximum Benefit Amount. The Allowable Charge for any other Covered Service is the billed charge. Certificate: A booklet summarizing Contract information provided to each employee. Coinsurance: The amount of each Allowable Charge which the Covered Person must pay. This amount is computed as a percentage of the Allowable Charges. Company: Blue Cross and Blue Shield of Nebraska. Consultations: Physician's services for a patient in need of specialized care requested by the attending Physician who does not have that knowledge. Cosmetic: Services, procedures, surgery and any drugs, supplies or Durable Medical Equipment provided to improve the patient's physical appearance,while not materially improving the patient's essential bodily functions, regardless of emotional or psychiatric factors. Covered Person: Covered employee or employee's Eligible Dependents. Covered Services: Hospital, medical or surgical services, drugs, supplies, Durable Medical Equipment, or other health care services, for which this Contract provides benefits, provided to a Covered Person while this Contract is in effect. Custodial Care: Care given to a patient who: 9836 Rev. 5/1/90 32 1. is mentally or physically disabled; and 2. needs a protected, monitored or controlled environment or assistance to support the basics of daily living, in an institution or at home; and 3. is not under active and specific medical, surgical or psychiatric treatment which will reduce the disability to the extent necessary to allow the patient to function outside such environment or without such assistance,within a reasonable time,which will not exceed one year in any event A Custodial Care determination may still be made if the patient is under the care of a Physician; or services are being ordered to support and generally maintain the patient's condition, or provide for the patient's comfort, or assure the manageability of the patient; or the ordered services are being administered by a registered or licensed practical nurse. Deductible Amount: An amount which the Covered Person must pay each calendar year for Covered Services before benefits are payable by this Contract. Durable Medical Equipment: Equipment and supplies Medically Necessary to treat an Illness or Injury, to improve the functioning of a malformed body member, or to prevent further deterioration of the patient's medical condition. Durable Medical Equipment includes such items as prosthetic devices, orthopedic braces, crutches and wheelchairs. Eligible Dependent: • 1. Employee's spouse unless the marriage has been ended by a legal, effective decree of dissolution, divorce or separation. 2. Employee's unmarried children 18 years of age or less who are chiefly dependent upon the employee for support and maintenance; a. A child is-chiefly dependent upon the employee for support and maintenance-so long as the employee provides more than one-half of the child's support Child includes stepchild, adopted child, and grandchild, who lives with the employee in a regular child-parent relationship, but not foster child. b. Reaching age 19 while a child is a Covered Person will not end the child's coverage under this Contract as long as the child is,and remains, both: (1) incapable of self-sustaining employment by reason of mental or physical handicap; and (2) chiefly dependent upon the employee for support and maintenance. We must receive proof of the requirements of(1) and (2) from the employee within thirty-one (31) days of the child's reaching age 19 and thereafter as we require (but not more often than yearly after two years of such handicap). Determination of eligibility under this provision will be made by us. 3. The employee's unmarried children 23 years of age or less who are chiefly dependent upon the employee for support and maintenance and are in full time attendance at an educational institution which has a curriculum, faculty and student body in attendance. Coverage hereunder will continue during normal school vacation periods if the child is enrolled for the following term. 4. Extension of Student Coverage for Disability: Coverage of such a student who becomes disabled after age 19 will continue hereunder if: a.The child is incapable of attending school by reason of mental or physical handicap. This determination will be made by us. 9836 Rev.5 1 90 � � 33 r A b. Proof of such disability is furnished to us by the employee within thirty-one (31) days of the disability. • c.The extended coverage will end: 1 (1) Two (2) years following the start of the disability; or (2) When the child is able to attend school full time; or (3) When the employee's coverage under this Contract ends; whichever occurs first. d. The extended coverage will be subject to all the Contract provisions. Freestanding Ambulatory Facility: A facility for the treatment of patients, which is not connected with offices of an individual or group practice of Physicians, nor licensed as a part of a Hospital, which provides those facilities and degree of care generally found in and required of licensed Hospitals, except for overnight care. Group Applicant: The group that arranges this coverage. Hospital: A Hospital is an institution or facility licensed by the State of Nebraska or the state in which it is located,which provides medical and surgical diagnostic and treatment services for compensation to persons with an Illness, Injury or Pregnancy, under the supervision of a staff of Physicians licensed to practice medicine and surgery and provides 24-hour per day nursing service. This definition of Hospital includes facilities licensed as general acute care hospitals, short-term hospitals, psychiatric hospitals, and emergencyhospitals 2 as defined by Nebraska statutes. ) S This definition of Hospital does not include: 1. a long-term care hospital or facility, primarily providing skilled or non-skilled nursing care, or a residential care or domiciliary care facility; 2. a rehabilitative hospital which is an inpatient facility operated for the primary purpose of assisting in the rehabilitation of disabled persons; primary i• 3. an institution whose p ry purpose is the furnishing of food, shelter, training or educational or non- medical personal services; 4. an alcoholism treatment center; 5. a drug treatment center; 6. a mental health center or a place for mental or physical rehabilitation, other than a psychiatric hospital as defined by Nebraska law. Illness: Bodily disorder or disease. Injury: Accidental physical harm. Inpatient: A patient admitted to a Hospital for bed occupancy for more than twenty-four(24) hours to receive necessary medical care. investigative Treatment: Treatment is considered Investigative when the service, procedure, drug, treatment modality has progressed to limited human application, but has not achieved recognition as being proven and effective in clinical medicine. 9836 Rev.5/1/90 `I 34 Such recognition may be achieved through the following: 1. Final approval for the use of a specific service, procedure, drug or treatment modality for a specific diagnosis from the appropriate governmental regulatory body; 2. Scientific evidence permitting a consensus conclusion recognizing the effectiveness of the specific service, procedure, drug or treatment modality on health outcomes for a specific diagnosis. We will determine whether a service, procedure,drug or treatment modality is Investigative. Master Group Application: A form provided by us, executed by you, and accepted by us which becomes a part of this Contract. The Master Group Application contains all of the variables which you must elect to determine the coverage for the Covered Persons of your group. Maternity Admission: Inpatient Hospital admission for PregnarScy. Maximum Benefit Amount:A benefit amount which is the lower of the Provider's billed charge for a Covered Service or the maximum amount determined by us to be reasonable. We may consider the charges submitted by providers for like procedures, a relative value scale which compares the complexity of services provided, or any other factor we deem necessary. Medical Emergency: The sudden and unexpected onset of symptoms or the exacerbation of a chronic condition which presents an acute, severe, and immediate life threatening situation requiring medical attention. Medically Necessary: The services, procedures,drugs, supplies or Durable Medical Equipment provided by the Physician, Hospital or other health care provider, in the diagnosis or treatment of the Covered Person's Illness, Injury, or Pregnancy,which are: 1. Appropriate for the symptoms and diagnosis of the patient's Illness, Injury or Pregnancy; and 2. Provided in the most appropriate setting and at the most appropriate level of services. The most appropriate setting and most appropriate level of services is that setting and that level of services which is the most cost effective without adversely affecting the Covered Person's medical condition. When this test is applied to the care of an Inpatient, the Covered Person's medical symptoms or condition must require that treatment cannot be safely provided in a less intensive medical setting; and 3. Consistent with the standards of good medical practice in the medical community of the State of Nebraska; and 4. Not provided primarily for the convenience of any of the following: a. the Covered Person; • b. the Physician; c. the Covered Person's family; d. any other person or health care provider; and 5. Not considered to be unnecessarily repetitive when performed in combination with other diagnoses or treatment procedures. We will determine whether services provided are Medically Necessary. Services will not automatically be considered Medically Necessary because they have been ordered or provided by a Physician. 9836 Rev. 5/1/90 35 1 Medicaid: Grants to States for Medical Assistance Programs, Title XVIII of the Social Security Act, as amended. Medicare: Health Insurance for the Aged and Disabled,Title XVIII of the Social Security Act, as amended. Membership Unit: The membership option selected by the employee identifying the group of persons to be provided coverage under this Contract. Mental Illness: A pathological state of mind producing clinically significant psychological or physiological symptoms (distress) together with impairment in one or more major areas of functioning (disability) wherein improvement can reasonably be anticipated with therapy. In addition, Mental Illness includes alcoholism, drug abuse and other controlled substance (drug) abuse. Non-PPO Nebraska Hospital: A Hospital which has not contracted with us to provide services as a part of the PPO Nebraska Provider network. Non-PPO Nebraska Physician: A licensed practitioner of the healing arts who has not contracted with us as a part of the PPO Nebraska Provider network., Non-PPO Nebraska Provider: A licensed practitioner of the healing arts, or qualified provider of health care services, supplies, or Durable Medical Equipment who has not contracted with us as a part of the PPO Nebraska Provider network. Outpatient: A person treated in the Outpatient department or emergency room of a Hospital, or in a Free Standing Ambulatory Facility, or a Physician's office. Participating Provider: A licensed practitioner of the healing arts, or qualified provider of-health care services, supplies, or Durable Medical Equipment who has contracted with us to provide services, supplies or Durable Medical Equipment. Physical Rehabilitation: Services provided primarily to improve the patient's ability to function in the activities of daily living, such as bathing,walking, using the toilet, eating, dressing, or homemaking. Pregnancy: Includes obstetrics, abortions, threatened abortions, miscarriages, premature deliveries, ectopic pregnancies, or other conditions or complications caused by Pregnancy. A complication caused by Pregnancy is a condition that occurs prior to the end of the Pregnancy, distinct from the Pregnancy, but caused or adversely affected by it. Post-partum depression and similar diagnoses are not considered complications of Pregnancy as that terminology is used in this Contract. PPO Nebraska Hospital: A Hospital which contracts with us to provide services as a part of the PPO Nebraska Provider network. PPO Nebraska Physician: A licensed practitioner of the healing arts who has contracted with us to provide Covered Services as a part of the PPO Nebraska Provider network. PPO Nebraska Provider. Any other licensed practitioner of the healing arts, or qualified provider of health care services, supplies, or Durable Medical Equipment who has contracted with us to provide services, supplies or Durable Medical Equipment as a part of the PPO Nebraska Provider network. Treatment Center: A licensed Alcoholism or Drug Treatment Center. a 9836 Rev.5/1/90 36 Erfl ENDORSEMENT CITY OF OMAHA P P0 NEBRASKA This Endorsement is attached to, and becomes a part 01, the City of Omaha Master Group Contract #9e36 Rev. 5/1/90. Such contract is amended as follows: 1. Part I,C, Waiting Periods, paragraph 1(a) and (b) Is deleted and replaced as follows: 1. No benefit payment will be made for Covered Services for the following conditions or procedures unti Blue Cross and Blue Shield of Nebraska coverage has been in effect for at least 270 continuous days: a. Pre-existing Conditions, which are defined as any illness or Injury for which a Physician prescribed medication or rendered medical treatment or advice within twelve (12) months prior to the effective date of coverage. A Pre-existing Condition is also defined as an Illness which exhibited symptoms within twelve (12) months prior to the effective date of coverage or a previous injury which exhibited symptoms or complications within twelve (12) months prior to the effective date of coverage, either of which would lead a prudent person to seek medical treatment or advice. b. Congenital defects or birth abnormalities, which are defined as conditions existing at or from birth which Is a deviation from the norm such as a dotting, protruding ears, birthmarks,webbed fingers or toes, and other conditions normally considered congenital defects or birth abnormalities. • c. Sterilization, tonstlectomy,appendectomy, adenoldectomy, mpacted teeth, myringotomy _.. or tympanoplasty. d. Colporrhaphy,cdpoplas y, cystocele (repair of anterior vaginal watt), perineorrhaphy, perineopiasty, rectoceie (repair of posterior vaginal wall), total or partial salpingectomy,total or partial oophorectomy, hysterectomy or myomectomy. e. Inguinal, u mbfical or femoral hernias, acne, hemorrhoids, varicose veins, duodenal or gastric ulcers, gall bladder disease, including gallstones, medical or surgical treatment of thyroid disease. • 2. Part N,D, Covered Person's Maximum Coinsurance Liability, is amended to provide that: Coinsurance Amounts paid by a Single or Family Membership for Covered Services provided for Mental Illness, Drug Addiction and Alcoholism, Organ Transplants and Home Health Aide and Hospice y$) be considered in computing the Maximum Coinsurance Liability. 3. Part IV,F, Precertification and Concurrent Review,Is amended at paragraph 1 to provide that: if a Covered Person does not obtain precertif►cation,the Allowable Charges otherwise considered for benefit payment by this Contract for Hospital or Treatment Center Covered Services associated with this Inpatient admission wit be reduced by$500.00. if inpatient precertfficatlon of benefits is denied, and the Covered Person is admitted to the Hospital or Treatment Center,the Allowable Charges considered for benefit payment under this Contract for a Covered Services associated with this admission will be reduced by fifty percent(50%). i MR-5 1 99-034 2/91 . Attu! (.K Paragraph 2 of.this Part V,F, is unerxied to provide that: ' • Mowable Charges considered for benefit payment for Covered Services provided during any period of inpatient cue which Wends beyond the length of stay prey by us wilt be reduced by fifty per (5 ) 4. Part VI,B, Covered Physician's Services, paragraphs 1 (a) and (b), ors deleted and replaced as follows: a. When multiple or bilateral surgical procedures which add significant time or complexity to patient care are performed at the same operative session, the total benefits shall be the amount payable for the major procedure plus: (1) fifty percent (50%) of the amount payable for the secondary procedure If only one incision Is required, or (2) seventy-five percent (75%) W a separate Incision is required. b. When an Incidental procedure such as an Incidental appendectomy, tysis of adhesions, excision of previous scar, or puncture of ovarian cyst, Is performed through the same Incision as for other surgery, the amount payable shall not exceed ten percent (10%) of the normal surgical allowance for the Incidental surgery. c. When a surgical procedure Is performed in two or more steps or stages, payment MI be limped to the amount provided for a single procedure. 5. Part Vll, Benefits for Maternity, paragraph A, Is amended to provide that: Benefits for maternity are not available for a dependent daughter. 6. Part VIII, Benefits for Mental Illness, Drug Addiction and Aicohollsrn, paragraph A, Covered Services, is deleted and replaced as follows: A. Covered Services: Covered SeMces.for the acute care of Mental Illness, drug addiction or alcoholism, or any combination thereof, shall be those Hospital services listed In Part V, and those Physician services listed in Part Vi. Benefits for the Outpatient treatment of drug addiction and alcoholism are available only for the programs specified at the facllties identified in Attachment A to this Endorsement. Benefits veil not be provided for treatment modalities which are Identified as Noncovered Services in Part XiII of this Contract. Paragraph B of this Part V11I, Inpatient and Day Cars, is amended to remove the thirty(30) day limitation per calendar year for Inpatient treatment. Paragraph C of this Part Vii1, Payment for Outpatient Services, is amended at subparagraph 1, PRO Nebraska Provider,to provide the . Benefits wil be paid by us for such Covered Services at 90%cf the Allowable Charge. The Covered Person is responsible for payment cf the Deductible, the 10%Coinsurance Amount and charges for Noncovered Services- This paragraph C is further amended at subparagraph 2, Non--PRO Nebraska Provider, to provide that: Benefits will be paid by us for such Covered Services at 80%of the Allowable Charge. The Covered Person is responsible for payment of the Deductible,the 20% Coinsurance Amount, any amount in excess of the Maximum Benefit Amount,and any charges for Noncovered SeMcea. > 034 2/91 7. Part LX, & c efka for Orr Surgery and Dentistry, paragraph 5.4 is deleted;and paragraph 5.5 deleted and replaced as follows: 6. Al other procedures or treatments irrvotving the teeth or structures directly related to or supportkv the teeth, hduding the gums and alveolar processes. & Part XII, Benefits for Other Covered Services and Supplies, paragraph A3 is deleted and replaced as follows: 3. Outpatient physical therapy provided by a licensed physical therapist or other qualified person under the direct supervision of a Physician. 8. Part XII, Benefits for Other Covered Services and Supplies, paragraph A.12 Is amended to delete the three (3) hour limitation for skilled nursing care. All other provisions of this paragraph remain the same. 10. Part XIII, Exclusions and Limitations, paragraph A1.m. is'deleted and replaced as follows: m. Artificial insemination, and related services. • 11. Part XIII, Exclusions and Limitations, Is amended to add at paragraph A.1: x. Services for voluntary abortions, unless the attending Physician certifies that the abortion was necessary to safeguard the life of the woman, or that the unborn chad's viability was threatened by continuation of the Pregnancy. This exclusion does not apply to medical complications arising from a voluntary abortion. 12. Part XIV, Procedures for Fling a Claim, paragraph B, Ia deleted and replaced as follows: B. A claim shafd be fled within 90 days of the time the services are provided, or as soon thereafter as is reasonably possible. if the employee does not file a claim within twenty-four (24) months of the dale of service, and k was reasonably possible to do so, benefits will not be paid. • • MR-5 ' 14-034 2/91 saris ? • • ATTACHMENT BESafi M Immanuel Alcoholism Treatment Center Outpatient Treatment Program Immanuel Medical Center 6901 North 72nd Street Omaha, Nebraska 68122 Chemical Dependency Services Outpatient Treatment Program Mercy Hospital 800 Mercy Drive Council Bluffs, Iowa 50501 Lincoln General Hospital Outpatient Treatment Program Independence Center • 2300 South 16th Street Uncoln, Nebraska 68502 • St. Joseph Center for Mental Health Outpatient Treatment Program 819 Dorcas Street Omaha, Nebraska 68108 Midlands Community Hospital Outpatient Treatment Program Highway 370 & South 84th Street Papiillon, Nebraska 68046 EXCLUSIONS AND UMITATIONS: 1. No patient shall be entitled to more than three (3) admissions per lifetime to any one or a combination of the approved treatment programs listed above. 2. After completing a program, the patient may not attend the same program or any other of the approved programs unless there is a 180-day lapse from one of the approved outpatient programs or an approved inpatient program. q EXHIBIT "C" This exhibit itemizes the fees and expense reimbursements Blue Cross and Blue Shield of Nebraska is entitled to pursuant to this Administrative Agreement to which this Exhibit "C" is attached. Fees are due and payable on or before the 15th of the calendar month, commencing on or before January, 1997. Fees are based on the existing enrollment at the end of the month prior to the assessment. Administrative Service Only(ASO) -Paid basis: including preferred provider organization (PPO) network charges per employee per month: January 1, 1997 to December 31, 1997 $18.75 per employee per month January 1, 1998 to December 31, 1998 $19.60 per employee per month January 1, 1999 to December 31, 1999 $20.50 per employee per month Charge for run out after January 1, 1997 7.00% In-hospital pre-certification per effected employee per month: January 1, 1997 to December 31, 1997 $2.25 per employee per month January 1, 1998 to December 31, 1998 $2.35 per employee per month January 1, 1999 to December 31, 1999 $2.45 per employee per month Organ transplant per level of coverage per month: January 1, 1997 to December 31, 1997 $0.75 per employee per month $2.25 per family per month . • January 1, 1998 to December 31, 1998 $0.84 per employee per month $2.50 per family per month January 1, 1999 to December 31, 1999 $0.94 per employee per month $2.80 per family per month 4841v • EXHIBIT "D-1" ENDORSEMENT CITY OF OMAHA ORGAN TRANSPLANTS This Endorsement is attached to, and becomes a part of, the City of Omaha Group Master Contract #9711 1/80, and Master Group Contract#9836 Rev. 5/1/90. Such contracts are amended to provide benefits for specified organ transplants as follows: A. BENEFITS FOR THE COVERED PERSON WHO IS A RECIPIENT OR DONOR: 1. Benefits will be provided for the following Medically Necessary Covered Services; a. Medical and surgical services; b. Hospital services; c. Durable Medical Equipment; d. Prescription medication; directly related to, or resulting from, a transplant of the following body organs: (1) Liver; (2) Lung; (3) Heart; (4) Heart-Lung; (5) Pancreas; (6) Kidney whether the recipient or donor of the organ is a Covered Person. 2. Benefits will be provided for transportation to and from the site of the transplant procedure for the Covered Person. Such benefits will be limited to the reasonable cost of land or commercial air transportation. B. ADDITIONAL BENEFITS -DONATION OF ORGANS: Benefits up to $10,000 will be provided for the following Medically Necessary Covered Services directly related to, or resulting from, a transplant procedure listed above. 1. Hospital, medical, surgical or other Covered Services provided to a donor who is a Noncovered Person; 2. Services provided for the evaluation of organs including, but not limited to, the determination of tissue matches; I I I 1 3. Services provided for the removal of organs from nonliving donors; 4. Services provided for the transportation and storage of donated organs. Benefits provided to Noncovered Persons shall be secondary to benefits provided to those persons pursuant to their own hospital, medical, surgical, or major medical coverage. C. PREAUTHORIZATION: All benefit payments for organ transplant procedures must be preauthorized by us in writing. Preauthorization shall be initiated by the Covered Person, in writing, to us requesting that benefits be paid for an organ transplant procedure. This request must be made before the procedure is performed, and be accompanied by documentation from the Covered Persons Physician demonstrating the Medical Necessity of the proposed transplant. This request should also indicate at what hospital the transplant procedure will be performed. This written request should be directed to: Blue Cross and Blue Shield of Nebraska Medical Support Department P.O. Box 3248 Omaha,NE 68180-0001 We will respond in writing advising the Covered Person as to whether benefits are available. BENEFITS WILL BE REDUCED BY 20% FOR THE ORGAN TRANSPLANT PROCEDURES LISTED IF SUCH PROCEDURES ARE NOT PREAUTHORIZED. D. EXCLUSIONS AND LIMITATIONS: 1. All benefits paid pursuant to Parts A and B of this Endorsement will be determined subject to the terms, conditions, limitations and exclusions, and individual and lifetime benefit maximums set forth in the benefit provisions of the Administrative Services Agreement and Contract between the parties which are not in conflict with the terms of this Endorsement. Benefits provided by this Endorsement will also be subject to the specific limitations set forth herein. 2. Transplant Benefit Period Limitation: The Transplant Benefit Period is defined as the period from five days immediately prior to, and one year immediately following, the transplant procedure (371 days). Benefits will be provided for only one transplant procedure during the Transplant Benefit Period. 3. Purchased Organs: Benefits will not be provided for the purchase of human organs which are sold rather than donated to the recipient. -2- 4. Nonhuman or Artificial/Mechanical Organs: Benefits will not be provided for transplantation of any nonhuman organ to a human recipient, or the permanent implantation of an artificial/mechanical organ into a human recipient. This provision does not apply to the implantation of pacemakers. E. REIMBURSEMENT The company will credit the monthly billings sent to the Plan Administrator with 100% of the actual expenses relating to this transplant which are approved by the Company's corporate reinsurance carrier during the month after the report from the reinsurer shows the amount of approved expenses. F. ORGAN TRANSPLANT - 50/50 ALTERNATIVE Blue Cross Blue Shield of Nebraska and the City of Omaha would share in the cost of each organ transplant on a 50/50 basis, up to $100,000 of net paid claims. Claims over the $100,000 related to the specific organ transplant would be the responsibility of Blue Cross Blue Shield of Nebraska. 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