Group Medical Plan. Your coverage under the Group Medical Plan Option varies depending on your location. Your location is based on the following:

Group Medical Plan

Lowe’s offers a comprehensive Group Medical Plan (the Group Medical Plan Option) to provide you with

access to affordable, flexible, and competitive healthcare services.

Your coverage under the Group Medical Plan Option varies depending on your location. Your location is based on the following:

y For store employees and distribution facility employees, the location where you work; and

y For all other employees, your home ZIP code. In many locations, participants in the Group Medical Plan Option can select one of two separate Co-pay Options:

y The Co-pay 500 Option; or

y The Co-pay 750 Option.

y Certain California, Colorado and Oregon locations can select between an HMO or the Co-pay 750 Options. The Co-pay Options are administered by different network managers, also depending upon your location. See below to determine who your network manager is.

Location Network Manager Alaska, Alabama, Arkansas,

Arizona, California, Colorado, Florida, Georgia, Idaho, Illinois, Iowa, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Montana, New York, North Carolina, North Dakota, New Mexico, Nevada, Ohio, Oregon, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington (except Seattle area)

Blue Cross Blue Shield of Alabama

1-205-988-2200 1-888-258-1710

All other states and Chicago and Seattle areas

Aetna

1-866-808-4441

For help in determining who your network manager is, contact the Lowe’s Group Benefits Department at 1-800-400-4104, option 2.

In some of our locations, coverage under the Group Medical Plan Option is offered through a Health Maintenance Organization (HMO) or Point-of-Service (POS) Plan rather than through the Co-pay 500 and Co-pay 750 Options. To determine which medical coverage options are available to you, see your annual enrollment material or talk to your HR Manager. Your annual enrollment material will indicate whether Group Medical coverage is offered through an HMO or POS, and provide information on specific benefit levels. Your Group Medical Plan Option description has been prepared to provide an explanation of your Co-pay Option coverage in the Group Medical Plan Option. Should you have questions about specific coverage, call your network manager before proceeding with treatment. If you are unable to get answers to your questions, please contact the Lowe’s Group Benefits Department at 1-800-400-4104, option 2.

All of the coverage options under the Group Medical Plan Option include prescription drug benefits. If you are enrolled in the Co-pay 500 or Co-pay 750 Options, your prescription drug benefits are administered by Express Scripts, Inc. Please see

“Outpatient Prescription Drug Coverage” on page 53 for further information regarding Express Scripts coverage. Prescription drug benefits for most of Lowe’s HMO and POS options are also administered by Express Scripts, Inc. However, who administers your prescription drug benefits may vary depending upon which HMO or POS you are enrolled in. Please refer to your enrollment packet for more information regarding your prescription drug coverage.

All of the coverage options under the Group Medical Plan Option include behavioral health benefits. If you are enrolled in the Co-pay 500 or Co-pay 750 Options, your behavioral health benefits are administered by Magellan Health Services. Please see “Mental Health and Substance Abuse Services” under “Comparison of Co-pay Options” for further information about coverage.

Please take the time to review this material carefully. Key terms used in this text are defined at the back of the sections labeled

“Blue Cross Blue Shield of Alabama Plans, An Overview” on page 14, and “Aetna Plans, An Overview” on page 25. If you are enrolled in one of Lowe’s HMO or POS Options or the

TRICARE Supplement Plan, a description of the plans’ benefits is provided separately. Refer to your HMO/POS or TRICARE Supplement Plan book and insurance certificate for details. This book, along with your HMO/POS or TRICARE Supplement Plan certificate and coverage materials, constitutes your SPD for the Group Medical Plan Option.

The Group Medical Plan Option is a cost-sharing mechanism for certain covered expenses incurred by you and your eligible family members. Under the Group Medical Plan Option, benefits are generally paid at a higher level if certain in-network healthcare providers are utilized. In all cases, your network manager or insurance carrier (not Lowe’s or the Group

Medical Plan Option) is responsible for selecting the healthcare providers that participate in the network and ensuring the quality of the network. All physicians and other healthcare providers that participate in the benefit plans are independent contractors. The Group Medical Plan Option is not responsible for the efficiency and integrity of the healthcare providers in delivering health services. The Group Medical Plan Option is also not liable in any way for the effect or delivery of such health services and supplies, the results of action taken as a result of health service or supply being limited or not covered by the Group Medical Plan Option, or any limitations imposed on the cost-sharing responsibility of the Group Medical Plan Option.

In This Section

See Page

Dependent Eligibility ... 4

Cost Sharing ... 4

Continuation of Coverage for Dependents of Deceased Employees... 4

Early Retiree Health Plan (Continuation of Group Health Benefits) ... 4

TRICARE Supplement Plan Coverage for Employees Enrolled in TRICARE... 5

Comparison of Co-pay Options ... 5

Comparison of Co-pay 500 and Co-pay 750 Medical Plan Options ... 7

Coverage Under an HMO or POS Option or the TRICARE Supplement Plan ... 14

Plan Overviews ... 14

Blue Cross Blue Shield of Alabama Plans, An Overview... 14

Aetna Plans, An Overview ... 25

Programs... 45

Utilization Management Program ... 45

Case Management Services... 46

Organ and/or Tissue Transplant Benefits ... 46

Prenatal Programs... 48

Disease Management... 48

Aetna Navigator ... 48

Health Advocate ... 49

Health Risk Assessments ... 49

Other Important Information... 50

In-Network Versus Out-of-Network Care ... 50

Preexisting Condition ... 50

You and Medicare ... 51

Health Maintenance Organization (HMO/POS) Enrollment... 51

Mothers’ and Newborns’ Health Protection Act ... 51

Women’s Health and Cancer Rights Act ... 52

Filing Claims ... 52

Dependent Eligibility

You must have employee coverage in order to have coverage for a dependent. You cannot elect dependent coverage by itself. You may enroll your dependents in the Group Medical Plan Option at the same time you become eligible, or within 31 days of acquiring a dependent, as long as you are eligible for dependent coverage.

The term dependent will not include any person who is also covered as an employee. Where husband and wife or employee and domestic partner are both covered under the Group Medical Plan Option as employees, either, but not both, may elect to cover the spouse, domestic partner and/or children and/or domestic partner’s children.

Cost Sharing

Lowe’s believes healthcare is one of the most important benefits we can offer our employees. That’s because it’s needed so that you can protect yourself and your family from major financial burdens that can result from serious illness and injury. As a result, Lowe’s pays a substantial portion of the cost for employee and dependent medical coverage. This means that you can help control costs and limit future contribution increases through conscientious use of Group Medical Plan Option benefits.

Continuation of Coverage

for Dependents of

Deceased Employees

If you die, coverage may be continued for your covered dependents without further premium contributions until the sooner of:

y One year from the date of your death;

y The date your spouse remarries or your domestic partner becomes the domestic partner of someone else or your dependent and/or your domestic partner’s child is no longer eligible;

y The date your spouse or domestic partner or dependent or domestic partner’s child becomes eligible for medical care coverage under any other group plan or becomes eligible to participate in Medicare. A dependent already participating in another group plan or Medicare is ineligible for this benefit; or

y The date the Group Medical Plan Option ends.

The one-year premium free coverage provision applies only to surviving covered spouses or dependents of employees deceased while actively employed. After the one-year premium free coverage expires, a surviving covered spouse or domestic partner or dependent or domestic partner’s child can elect continuation of coverage under COBRA. See the “Continuation of Coverage under COBRA” section of Plan Administration for more information regarding COBRA elections.

This provision does not apply to surviving covered spouses or domestic partners of participants in the Early Retiree Health Plan.

Early Retiree Health Plan

(Continuation of Group

Health Benefits)

The purpose of Lowe’s Early Retiree Health Plan is to provide uninterrupted medical coverage to eligible early retirees from their retirement to Medicare eligibility.

For information on employee and dependent eligibility for purposes of participation in the Early Retiree Health Plan, please see “What if…You Retire” in Plan Overview. For further information regarding the Early Retiree Health Plan, contact the Lowe’s Group Benefits Department for a copy of the Early Retiree Health Plan book.

Lowe’s also provides pre-65 and post-Medicare medical plan options through the Retiree Health AccessSM _{Program. For}

further information regarding these options contact the Retiree Health Access call center at 866-643-8742 or go online to http://www.rhagroup.net. The Username is “lowesguest” and the Password is “Lowesguest1.”

TRICARE Supplement

Plan Coverage for

Employees Enrolled in

TRICARE

TRICARE eligible employees can reduce their health insurance cost by using TRICARE as primary and enrolling in the TRICARE Supplement Plan administered by ASI and underwritten by The Hartford Life and Accident Insurance Company. When employees elect to enroll in the TRICARE Supplement Plan they do not enroll or are no longer enrolled in the Group Medical Plan Option.

Why would a TRICARE eligible employee want to enroll in the TRICARE Supplement Plan?

y Monthy Premium Cost-paid 100% by the eligible employee. Premium cost is deducted on a pre-tax basis.

y Comprehensive Coverage—The TRICARE Supplement Plan works with TRICARE to provide you and your eligible family members with protection from out-of-pocket charges. You and your family will receive coverage for hospital charges, doctor’s charges and prescription drug charges.

y Pays Excess Charges—The TRICARE Supplement Plan works with TRICARE to cover 100% of “excess charges”. That is, the Supplement will pay the difference between what your non-participating provider bills and TRICARE allows.

y No Pre-Existing Limitations—All health conditions are covered immediately for you and your eligible family members. There is no waiting period for coverage. Coverage begins on your effective date.

y Flexibility and Freedom to Select your own Civilian Doctor—The TRICARE Supplement Plan allows you freedom and flexibility to select your own TRICARE or Medicare authorized doctor, specialist or hospital. There are no referrals necessary.

y Guaranteed Acceptance—You or your family cannot be turned down. As long as you are eligible for TRICARE, you are eligible to enroll in the TRICARE Supplement Plan.

y Portability—If you should terminate employment, you can take the coverage with you by paying a low monthly premium cost directly to ASI. The Supplement will continue for as long as you choose to or up to age 65.

After TRICARE has paid, the TRICARE Supplement Plan pays the following benefits:

y Full reimbursement of the TRICARE deductible ($150 individual/$300 family).

y Full reimbursement of the TRICARE cost share (25% Standard, 20% Extra or 50% Prime Point-of-Service).

y Full reimbursement of the TRICARE Prime copayments.

y Full reimbursement of excess charge benefits-Even if the charge is above reasonable and customary, it is covered 100%.

For more information contact ASI at

1-800-638-2610, ext. 255 or visit their website at www.asicorptricaresupp.com.

To enroll in the TRICARE Supplement Plan go to Stores Home Page>Information at Your Fingertips>ASI TRICARE, and complete the enrollment form. Give the completed form to your location’s HR Manager.

The TRICARE Supplement Plan will not be available after July 31, 2008.

Comparison of Co-pay

Options

The following comparison highlights the health benefits offered by the Co-pay 500 and Co-pay 750 Options of the Group Medical Plan Option. This comparison is intended to assist you in determining which option best fits your needs. Each option is designed to provide comprehensive medical coverage. However, there are some major differences. While the Co-pay 500 Option offers richer benefits, the Co-pay 750 Option offers cost-effective coverage at lower premiums. Participants in both Co-pay Options will generally save money by seeing a preferred provider. The preferred providers for your Co-pay Option will depend on who your network manager is. Check with your network manager for details.

Coverage under the Co-pay Options may vary depending upon your network manager. Please make sure to review the comparison chart that applies to your network manager. If you

are not sure who your network manager is, call the Lowe’s Group Benefits Department at 1-800-400-4104, option 2 or ask your HR Manager.

Every effort has been made to provide an accurate summary of the Co-pay Options. However, if there is a conflict between the comparison chart and the summary of coverage that you may receive from the network manager, (e.g., Certificate of Coverage enrollment book) the network manager’s summary of coverage will control. Please refer to the “Introduction” section of Plan Overview for information on how to obtain a summary of coverage (if available)

Comparison of Co-pay 500 and Co-pay 750 Medical Plan Options

BENEFITS

Co-Pay 500

Co-Pay 750

General Provisions

Lifetime Maximums $2,000,000 individual lifetime maximum for active participants

$2,000,000 individual lifetime maximum for active participants

Deductible (calendar year) y In-Network: $500 per individual/$1,500 per family, per calendar year.

y Out-of-Network: $1,000 per individual/$3,000 per family, per calendar year.

y In-Network: $750 per individual/$2,250 per family, per calendar year.

y Out-of-Network: $1,500 per individual/$4,500 per family, per calendar year.

Maximum Out-of-Pocket Limit (calendar year)

y In-Network: $5,000 per individual/$10,000 per family, per calendar year. (Including the calendar year deductible.) y Out-of-Network:

$10,000 per

individual/$20,000 per family, per calendar year. (Including the calendar year deductible.) y

y In-Network: $6,000 per individual/$12,000 per family, per calendar year. (Including the calendar year deductible.) y Out-of-Network:

$12,000 per

individual/$24,000 per family, per calendar year. (Including the calendar year deductible.) y

Plan/Employee Coinsurance Percentage

y In-Network: 75% plan/25% employee, except when office visit and prescription copays apply.

y Out-of-Network: 50% plan/50% employee.

y In-Network: 70% plan/30% employee, except when office visit and prescription copays apply.

y Out-of-Network: 50% plan/50% employee.

BENEFITS

Co-Pay 500

Co-Pay 750

Inpatient & Outpatient Hospital

Facility Services

Hospital (Includes Maternity)* For pre-certification

y Aetna: Call the precertification number on your ID card. y BCBS of Alabama: Call

1-800-248-2342.

y In-Network: 75% plan/25% employee. (Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee after additional $300 co-pay per admission. (and the out-of-network calendar year

deductible.)

y All admissions require pre-certification. For maternity, member cost sharing applies to all covered benefits incurred during a member’s inpatient stay. Precert required. y Emergency admissions

require certification within 48 hours of admission. If preadmission certification is not obtained, a 30% reduction in benefits applies.

y In-Network: 70% plan/30% employee. (Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee after additional $400 co-pay per admission. (and the out-of-network calendar year deductible.)

y All admissions require pre-certification. For maternity, member cost sharing applies to all covered benefits incurred during a member’s inpatient stay. Precert required. y Emergency admissions

require certification within 48 hours of admission. If preadmission certification is not obtained, a 30% reduction in benefits applies.

Out-Patient Surgery*

For pre-certification or information on procedures requiring pre-certification, call Aetna or BCBS of Alabama at the precertification number on your ID card.

y In-Network: 75% plan/25% employee. (Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee. (and the out-of-network calendar year

deductible.)

y In-Network: 70% plan/30% employee. (Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee. (and the out-of-network calendar year

BENEFITS

Co-Pay 500

Co-Pay 750

Other Medical Expenses* y In-Network: 75% plan/25% employee. y Out-of-Network: 50%

plan/50% employee.

y In-Network: 70% plan/30% employee. y Out-of-Network: 50%

plan/50% employee. Physician Office Services

Physician Office Visit (non-surgery)

y In-Network: $25 employee co-pay for Primary Care physician and and $35 for specialist (lab, x-ray, etc., when billed by the physician are included in the co-pay; when not billed by the physician, the employee pays 25%).(Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee.* (and the out-of-network calendar year

deductible.)

y In-Network: $35 employee co-pay for Primary Care physician and $45 for specialist (lab, x-ray, etc., when billed by the physician are included in the co-pay; when not billed by the physician, the employee pays 30%).(Subject to the in-network calendar year deductible.)

y Out-of-Network: 50% plan/50% employee.* (and the out-of-network calendar year

deductible.)

Wellness Exams y In-Network: $25 co-pay

for primary care physician and $35 for specialist

y Out-of-Network: 50% coverage. (and the out-of-network calendar year deductible.) y Age/frequency

limitations apply.

y In-Network: $35 co-pay for primary care physician and $45 for specialist

y Out-of-Network: 50% coverage. (and the out-of-network calendar year deductible.) y Age/frequency

limitations apply. Preventive Care Benefits

y Mammograms y Pap Smears

y Positive Specific Antigen

y Routine mammograms, pap smears and positive specific antigen (PSA) tests are included in the co-pay for an Annual Physical. y Refer to the “Preventive

Care Benefits” section for more information.

y Routine mammograms, pap smears and positive specific antigen (PSA) tests are included in the co-pay for an Annual Physical. y Refer to the “Preventive

Care Benefits” section for more information.

BENEFITS

Co-Pay 500

Co-Pay 750

Maternity Care*

To participate in the Prenatal program:

y Aetna: Beginning Right program, call Aetna at 1-800-272-3531 y BCBS of Alabama: Baby Yourself

program, call BCBS of AL at 1-800-222-4379 or in Birmingham, AL call 1-205-733-7065.

y In-Network care: $25 co-pay for primary care physician and $35 for specialist (lab, x-ray, etc., when billed by the physician are included in the co-pay; when not billed by the physician, the employee pays 25%).%).(Subject to the in-network calendar year deductible.)

The co-pay is applicable to the office visit determining pregnancy. All other maternity charges, including prenatal and post-delivery care is subject to the deductible and coinsurance. y Out-of-Network office

visits, lab & x-ray at 50% plan/50% employee. (and the out-of-network calendar year deductible.) y All pregnant mothers

should enroll in the Prenatal program in their first 24 weeks of pregnancy.

y In-Network care: $35 employee co-pay for primary care physician and $45 for specialist (lab, x-ray, etc., when billed by the physician are included in the co-pay; when not billed by the physician, the employee pays 30%).%).(Subject to the in-network calendar year deductible.)

The co-pay is applicable to the office visit determining pregnancy. All other maternity charges, including prenatal and post-delivery care is subject to the deductible and coinsurance. y Out-of-Network office

visits, lab & x-ray at 50% plan/50% employee. (and the out-of-network calendar year deductible.) y All pregnant mothers

should enroll in the Prenatal program in their first 24 weeks of pregnancy.

Urgent Care Center and Emergency Room

Emergency Room* y In/out-Network: 75%

plan/25% employee; $100 additional co-pay per visit (waived if admitted).

y No coverage for non-emergency use of emergency room.

y In/out-Network: 70% plan/30% employee; $250 additional co-pay per visit (waived if admitted).

y No coverage for non-emergency use of emergency room.

BENEFITS

Co-Pay 500

Co-Pay 750

Urgent Care-Minor Emergency Room Facilities*

y In-network: 75% plan/25% employee; $35 additional co-pay per visit.

y Out-of-network: 50% plan/50% employee; additional $200 co-pay per visit.

y In-network: 70% plan/30% employee; $45 additional co-pay per visit.

y Out-of-network: 50% plan/50% employee; additional $500 co-pay per visit.

Other Services

Home Health Care* In-network: 100%

coverage for 120 visits per calendar year, with limitations. Deductible applies. Out-of-network 50% after deductible.

In-network: 100% coverage for 120 visits per calendar year, with limitations. Deductible applies. Out-of-network 50% after deductible.

Hospice y 100% coverage for first

$10,000; 75% thereafter. y Deductible applies. y Out-of-network 50%

after deductible

y 100% coverage for first $10,000; 70% thereafter.

y Deductible applies. y Out-of-network 50%

BENEFITS

Co-Pay 500

Co-Pay 750

Organ and/or Tissue Transplant

Benefits Transplants*

Program available to Aetna plan participants only:

Call Aetna’s National Medical Excellence Program at 1-877-212-8811

Coverage for organ and tissue transplants using your network manager’s National Medical

Excellence program. Also, covers living and transportation expenses with limitations. Otherwise, there is no living or transportation expense. In-Network at 75% plan/ 25% employee and Out-of- Network at 50% plan/50% employee after additional $300 co-pay per admission. Some transplant benefits are not covered (for more information, see the “Expenses Not Covered” section for Aetna).

Coverage for organ and tissue transplants using your network manager’s National Medical

Excellence program. Also, covers living and transportation expenses with limitations. Otherwise, there is no living or transportation expense. In-Network at 70% plan/ 30% employee and Out-of- Network at 50% plan/50% employee after additional $300 co-pay per admission. Some transplant benefits are not covered (for more information, see the “Expenses Not Covered” section for Aetna).

*Remember, theapplicable calendar year deductible will also apply.

Mental Health Services and Substance Abuse Services, Provided by Magellan, Applies to

Both the Co-pay 500 and Co-pay 750 Medical Plan Options

Behavioral Health In-Network (INN) Out-of-Network (OON)

Deductible None None

Annual Out-of-pocket Maximum Combined with Medical Plan

y $2,500 per covered member per y calendar year

y $7,500 family aggregate

y $5,000 per covered member per calendar year

y $15,000 family aggregate Prior Authorization

Call Magellan Health Services at 1-877-543-3875

Yes, all services Yes, All Services, except Routine Outpatient and Medication Management

Inpatient Facility Coverage y Acute Inpatient* y Residential** y Supervised Living** y Partial Hospitalization** y Intensive Outpatient

Program***

y 75% plan/25% member coinsurance y 30 days per year INN/OON combined y 60 days per Lifetime maximum for

Mental Health and Substance Abuse Treatment INN/OON combined

y $300 Per Admission co-pay for Acute Inpatient, then 50% plan/50% member coinsurance of billed charges

y 30 days per year INN/OON combined y 60 days per Lifetime maximum for

Mental Health and Substance Abuse Treatment INN/OON combined Routine Outpatient

(Individual, Group, Family)

y 100% after $25 member co-pay per visit

y 40 visits per year INN/OON combined

y 50% plan/50% member coinsurance of Usual and Customary Charge y 40 visits per year INN/OON

combined Ongoing Medication

Management

y $25 member co-pay per visit y Not subject to Outpatient visit limits

y 50% plan/50% member coinsurance of Usual and Customary Charge y Not subject to Outpatient visit limits

Higher Levels of Care Covered and coverage basis from available inpatient days: *Acute Inpatient: 1:1

**Residential, Supervised Living, Partial Hospitalization Program: 2:1 ***Intensive Outpatient Program (IOP): 4:1

NOTE: For Out-of-Network claims, your actual expenses for covered services may exceed the stated coinsurance percentage amount because actual provider charges may not be used to determine the payment obligations for Magellan and Lowe’s members.

Coverage Under an HMO

or POS Option or the

TRICARE Supplement

Plan

Many of the provisions discussed in this book apply only to the Co-pay Options. If you are enrolled in an HMO or POS option or the TRICARE Supplement Plan provided by Lowe’s, you should consult the coverage materials for your plan to determine information such as co-pay amounts, covered expenses, and definitions. Please contact your HMO or POS carrier or the Lowe’s Group Benefits Department if you do not have a copy of the book that describes your coverage option. TRICARE Supplement Plan members should contact the Association & Society Insurance Corporation (ASI).

Plan Overviews

This section provides further information on the Co-pay Options and the benefits available in the plans. Please review this information carefully as it is intended to help you in determining which option best fits your needs. If you have any questions, contact your network manager. If you are not sure who your network manager is, call the Lowe’s Group Benefits Department at 1-800-400-4104, option 2 or ask your HR Manager.

Blue Cross Blue Shield of

Alabama Plans, An Overview

If you are located in Alaska, Alabama, Arkansas, Arizona, California, Colorado, Florida, Georgia, Idaho, Iowa, Indiana, Illinois (except Chicago area), Kansas, Kentucky, Louisiana, Mississippi, Montana, North Carolina, North Dakota, New Mexico, New York, Nevada, Ohio, Oregon, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington (except Seattle area), you may be eligible to participate in the Co-pay 500 and Co-pay 750 Options with Blue Cross Blue Shield of Alabama (BCBSAL) as your network manager.

To determine whether BCBSAL is your network manager, please review your annual enrollment book, or ask your HR Manager.

Refer to the BCBSAL comparison chart in “Comparison of Co-pay Options” on page 5 for specific coverage level information.

Utilization Review

One of several requirements for hospital benefits is that you receive certification of the medical necessity of your hospital stay in advance, except for emergencies and when you are participating in a Concurrent Utilization Review Program (CURP). If you are admitted on an emergency basis, you must provide notice to us within 48 hours and your admission must also be certified as both medically necessary and as an emergency admission. Failure to obtain certification of medical necessity will result in a significant benefit reduction. Certification of a hospital admission does not mean that the admission will be covered. For example, the admission may be for apreexisting condition or any other excluded condition. You may appeal a precertification decision if your request for precertification is denied.

Precertification of Benefits

You are required to obtain approval from BCBSAL before certain supplies or services are rendered. For example, you may be required to obtain precertification of inpatient hospital benefits.

In order to file a preservice claim, you or your provider must call the BCBSAL Health Management Department at 1-800-248-2342 (1-205-988-2245 in Birmingham). You must tell the Health Management Department your contract number, the name of the facility to which you are being admitted (if applicable), and the name and phone number of a person that can be called back. You may also submit preservice claims in writing to:

450 Riverchase Parkway East Birmingham, AL 35298

If you are not sure whether a service or supply requires precertification, contact BCBSAL.

Continuing Review of Treatment

After treatment has been approved, BCBSAL will continue to review your treatment. If you would like to request an extension of previously approved care, call:

1-800-248-2342 (1-205-988-2245 in Birmingham) for inpatient hospital care;

1-205-220-7202 for preferred physical therapy or occupational therapy; or

1-205-220-6128 for care from a participating chiropractor.

BlueCard Preferred Provider

Organization (PPO) Program

Covered Benefits

The Co-pay 500 and Co-pay 750 Options cover most types of medical expenses necessary as the result of a non-occupational injury or non-occupational illness. How much the Co-pay Options pay depends on the Option that you choose and, if applicable, your in-network and out-of-network choices. Some benefit limitations apply. See “Comparison of Co-pay Options” on page 5 for more information.

To qualify as plan benefits, medical services and supplies must meet the following requirements:

y They are furnished after your coverage becomes effective and while you are still covered under the plan;

y No preexisting condition limitation applies; and

y The network manager determines either before, during, or after the services are provided that the services and supplies are medically necessary.

All benefits are subject to all deductibles, conditions, limitations, and exclusions of the Group Medical Plan Option.

NOTE: You can use the Health FSA to reimburse yourself for co-payment amounts. Please see Spending Accounts for more information.

Percentage Paid for Covered Expenses

After the calendar year deductible has been satisfied, benefits will be paid for covered expenses at the payment rates indicated in “Comparison of Co-pay Options” on page 5.

If you are required to use preferred physicians and choose not to, penalties will reduce the normal payment rates. Also, if a treatment is not precertified and approved as is required, penalties will reduce the payment rate shown above.

Covered expenses include:

Inpatient Hospital Benefits in a

Participating Hospital

y Bed and board and general nursing care in a semiprivate room; or

y Use of special hospital units such as intensive care or burn care and the hospital nurses who staff them; and

y Use of operating, delivery, recovery, and treatment rooms and the equipment in them;

y Administration of anesthetics by hospital employees and all necessary equipment and supplies;

y Casts and splints, surgical dressings, treatment, and dressing trays;

y Diagnostic tests, including laboratory exams, metabolism tests, cardiographic exams, encephalographic exams, and X-rays;

y Physical therapy, hydrotherapy, radiation therapy, and chemotherapy;

y Oxygen and equipment to administer it;

y All drugs and medicines used by you and administered in the hospital;

y Regular nursery care and diaper service for a newborn baby while its mother has coverage; and

Inpatient PPO Hospital Benefits for

Maternity

y Group health plans and health insurance issuers offering group health insurance coverage generally may not, under federal law, restrict benefits for any hospital length of stay in connection with childbirth for the mother or newborn child to less than 48 hours following a vaginal delivery, or less than 96 hours following a cesarean section. However, federal law generally does not prohibit the mother’s or newborn’s attending provider, after consulting with the mother, from discharging the mother or her newborn earlier than 48 hours (or 96 hours as applicable). In any case, plans and issuers may not, under federal law, require that a provider obtain authorization for the plan or insurance issuer for prescribing a length of stay not in excess of 48 hours (or 96 hours). Note: Newborns who remain hospitalized after the mother is discharged will require certification of medical necessity.

Inpatient Hospital Benefits in a

Nonparticipating Hospital in Alabama

y Benefits are paid only in cases of accidental injuries.

Outpatient Hospital Benefits in a

Nonparticipating Hospital in Alabama

y Only services to treat accidental injury are subject to co-pay.

PPO Outpatient Facility Benefits

y Emergency treatment of an accidental injury;

y Chemotherapy and radiation therapy;

y IV therapy;

y Hemodialysis;

y X-rays, lab, and pathology services;

y Medical Emergency subject to co-pay; and

y Surgery subject to co-pay.

PPO Physician Benefits

y Surgery, including preoperative and postoperative care, reduction of fractures, and endoscopic procedures;

y Anesthesia by a preferred physician for a covered service;

y Second surgical opinion services by a preferred physician;

y Obstetrical care for childbirth, pregnancy, and the usual care before and after those services;

y Inpatient visits by a preferred physician while you’re a hospital patient for other than surgery, obstetrical care, or radiation therapy, except for an unrelated condition;

y Consultation for a medical, surgical, or maternity condition by a specialty preferred physician, but only one consultation for each hospital stay;

y Diagnostic lab, x-ray and pathology services in a preferred physician’s office when related to covered services, but not allergy testing;

y Radiation therapy and chemotherapy by a preferred physician;

y Care by a preferred physician in the emergency room of hospital for other than surgery or maternity subject to co-pay; and

y Exam, diagnosis, and treatment for an illness or injury besides routine office visits and allergy treatment in a preferred physician’s office, subject to co-pay.

Your preferred physician may bill another group health plan for any difference between the amount paid by BCBSAL and his charge for any service that is a benefit of the Group Medical Plan Option. For a service provided by a nonpreferred physician in the area where a preferred physician is available, the Allowed Amount to which any co-payment percent is applied is the preferred physician fee amount.

Preventive Services

y Routine immunizations are covered if they are provided to prevent diphtheria, tetanus, pertussis, polio, rubella, mumps, measles, HIB, hepatitis B, chicken pox, meningococcal disease or provided during the first 24 months of life to prevent invasive pneumococcal disease or provided during the 6th _{through the 23}rd _{months of life to prevent influenza;} y Inpatient visits for routine newborn care;

y One routine pap smear a year for females;

y One baseline mammogram for females ages 35 to 39;

y One prostate specific antigen test each year for males dialysis ages 35 and over;

y One cholesterol test every five years;

y One routine sigmoidoscopy every three years for age 50 and over;

y One routine hemocult stool check each year for ages 50 and over;

y Double-contrast barium enema every five years for age 50 and over;

y Colonoscopy every 10 years for age 50 and over;

y One routine lab test by a PPO provider to include a complete blood count, urinalysis, and TB skin test when performed with a covered routine office visit when necessary;

y Nine office visits for the first two years of a baby’s life; annual exams for ages two through six (subject to office visit co-pay);

y One routine office visit every two calendar years for ages seven to 34 and one visit each calendar year for age 35 and older (subject to office visit co-pay).

y One routine Gynecological Care Exam each calendar year for female members.

Baby Yourself Program

y If you or your covered spouse is pregnant, Baby Yourself offers individual care by a registered nurse. Please call BCBSAL’s nurses at 1-800-222-4379 (or 1-205-733-7065 in Birmingham) as soon as you find out you are pregnant. Begin care for you and your baby as early as possible and continue throughout your pregnancy.

Other Covered Services

y Outpatient hospital services;

y Anesthesia for surgery or obstetrical care when given by someone other than the surgeon, obstetrician, or hospital employee;

y Physical therapy and hydrotherapy given by a licensed physical therapist. Preferred physical therapists may be required to precertify services during the course of your treatment. If so, the preferred physical therapist will initiate the precertification process for you. If precertification is denied, you will have the right to appeal the denial;

y Radiation therapy and chemotherapy;

y Lab and x-ray exams and other diagnostic tests such as allergy testing;

y Artificial arms, leg braces, and other orthopedic devices;

y Medical supplies such as oxygen, crutches, casts, catheters, colostomy bags and supplies, and splints;

y Treatment of natural teeth injured by a force outside your mouth or body, if service is received within 90 days of the injury;

y Professional ambulance service to the closest hospital that could treat the condition;

y The less expensive of rental or purchase of durable medical equipment, such as wheelchairs and hospital beds;

y Hemodialysis services of a participating renal dialysis facility;

y Treatment of mental and nervous disorders including alcoholism and drug addiction;

y Physicians’ covered services. Surgery includes preoperative and postoperative care, reduction of fractures and

endoscopic procedures, maternity deliveries and heart catheterization. The allowed amount and preferred physician fees for surgical care follow these rules:

ƒ If two or more related surgical procedures are done in the same sessions, only the procedure with the largest fee is allowed. If the procedures are not related but done during the same session, the full amount of the procedure with the largest fee and one-half of the fee for each of the others will be allowed;

ƒ for delivery of twins, triplets, etc., only the one largest fee is allowed, whatever the number of babies or how they are delivered; and

ƒ When two different specialists assist each other to operate in the same field as co-surgeons, each is allowed 75% of the fee for the surgery. Additional amounts will not be allowed for assisting at surgery.

y Occupational therapy services when the following conditions are met:

ƒ The services are medically necessary and performed by a licensed occupational therapist; and

ƒ Call 1-888-258-1710 (1-205-988-2200 in Birmingham) to determine what benefits are covered under this program, and for more information regarding payment of occupational therapists and precertification of

occupational therapy benefits.

y Phase I therapy and exams for TMJ disorders according to the guides of the American Academy of Craniomandibular Disorders.

y Chiropractic services by Participating Chiropractors may be required to precertify services during the course of your treatment.

y Home healthcare when it is performed by or under the direct supervision of a licensed, registered, or practical nurse and reviewed by a physician. Covered services include:

ƒ Nursing service by either a registered nurse (R.N.) or licensed practical nurse (L.P.N.);

ƒ Physical, occupational, speech, and respiratory therapy;

ƒ Medical social service;

ƒ Home health aid services;

ƒ Nutritional guidance;

ƒ Diagnostic services;

ƒ Oxygen and its administration; and

ƒ Hemodialysis.

y Hospice care is covered when provided by a hospice program to a person who is expected by his physician to live no more than six months. Covered services include:

ƒ Room, board, and general nursing care;

ƒ Services of hospice-employed physicians;

ƒ Physical therapy, occupational therapy, respiratory therapy, and speech language pathology services provided by licensed providers;

ƒ Medical social services provided by licensed social workers;

ƒ Home health and visits by hospice employees;

ƒ Medical appliances and drug and biologicals to relieve pain and control symptoms of the member related to his terminal illness;

ƒ Skilled nursing visits by a licensed registered nurse or licensed practical nurse;

ƒ Skilled nursing facility benefits, that include facility charges for room, board, and routine nursing care, when the patient is recovering from a serious illness or injury, confined to bed with a long-term illness or injury, or has a terminal condition. The admission must take place within 14 days after the patient leaves the hospital and that hospital stay must have lasted at least three days in a row for the same illness or injury. The patient’s doctor must visit him at least once every 30 days and these visits must be written in the patient’s medical records. The facility must be an approved skilled nursing facility, as defined by the Social Security Act; and

ƒ Speech therapy given by a qualified speech therapist or physician; and

ƒ Individual Case Management.

Unfortunately, some people suffer from catastrophic, long-term, and chronic illness or injury. If you have a catastrophic, long-term, or chronic illness or injury, a Blue Cross Registered Nurse may assist you in accessing the most appropriate health care for your condition. The nurse case manager will work with you, your physician, and other health care professionals to design a treatment plan to best meet your health care needs. In order to implement the plan, you, your physician, and Blue Cross must agree to the terms of the plan. The program is voluntary to you and your physician. Under no circumstances are you required to work with a Blue Cross case management nurse. Benefits provided to you, through Individual Case Management are subject to your benefit contract maximums. If you think that you may benefit from Individual Case Management, please call the Health management division at 1-205-733-7067 or 1-800-821-7231.

Organ, Tissue and Bone Marrow/Cell

Transplants

The organs and tissue for which there are benefits are: (1) heart; (2) liver; (3) lungs; (4) pancreas; (5) kidney; (6) heart-valve; (7) skin; (8) cornea; and (9) small bowel. Bone marrow transplants, which include stem cells and marrow to restore or make stronger the bone marrow function, are also included. The transplant must be preformed in a hospital or other facility on

BCBSAL’s list of approved facilities for that type of transplant and it must have BCBSAL’s advance written approval. When BCBSAL approves a facility for transplant services it is limited to the specific types of transplants stated. Donor organ costs are limited to search, removal, storage and the transporting of the organ and removal team. There are no transplant benefits: (1) for any artificial or mechanical devices; (2) for organ or bone marrow transplants from animals; (3) for donor costs available through other group coverage; (4) if any government funding is provided; (5) if the recipient is not covered by the Group Medical Plan Option; (6) for recipient or donor room, food, or transportation costs we did not approve in writing; (7) for a condition or disease for which a transplant is considered investigational; or (8) for transplants performed in a facility not on BCBSAL’s approved list for that type or for which BCBSAL hasnot give written approval in advance.

Mastectomy and Mammograms

Women’s Health and Cancer Rights Act Information

A member who is receiving benefits in connection with a mastectomy will also receive coverage for reconstruction of the breast on which a mastectomy was performed and

reconstruction of the other breast to produce a symmetrical appearance; prostheses; and treatment of physical complications at all stages of the mastectomy, including lymphedema. Treatment decisions are made by the attending physician and patient. Benefits for this treatment will be subject to the same calendar year deductibles and coinsurance provisions that apply to other medical and surgical benefits.

Benefits for Mammograms

Benefits for mammograms vary depending upon the reason the procedure is performed and the way in which the provider files the claim:

If the mammogram is performed in connection with the diagnosis or treatment of a medical condition, and if the provider properly files the claim with this information, we will process the claim as a diagnostic procedure according to the benefit provisions of the plan dealing with diagnostic x-rays. If you are at high risk of developing breast cancer or you have a family history of breast cancer—within the meaning of our medical guidelines—and if the provider properly files the claim with this information, we will process the claim as a diagnostic procedure according to the benefit provisions of the plan dealing with diagnostic x-rays. In all other cases the claim will

be subject to the routine mammogram benefit provisions and limits described elsewhere in this booklet.

Expenses NOT Covered

Although the Group Medical Plan Option covers most types of medical, hospital and surgical expenses, there are some expenses that are NOT covered.

Group Medical Plan Option exclusions include, but are not limited to:

y Services or expenses that are not medically necessary, as determined by BCBSAL.

y Services, care, or treatment you receive after the date coverage ends. This means for example, that if you are in the hospital when your coverage ends, we will not pay for any more hospital days. We provide benefits only for services and expenses furnished while the BCBSAL Group Medical Plan Option is in effect.

y Services or expenses for cosmetic surgery, performed primarily to restore or change the way one appears. Reconstructive surgery, performed primarily to restore or improve the way the body works or to correct deformities that result from disease, trauma, or birth defects will be covered. Complications or later surgery related in any way to cosmetic surgery is not covered, even if medically necessary, if caused by an accident, or even if medically necessary, if caused by an accident, or if done for mental or emotional relief. Contact BCBSAL prior to surgery to determine if a procedure will be reconstructive or cosmetic.

y Services or expenses to care for, treat, fill, extract, remove, or replace teeth, or to increase the periodontium. The periodontium includes the gums, the membrane surrounding the root of a tooth, the layer of bone covering the root of a tooth, and the upper and lower jaws and their borders, that contain the sockets for the teeth.

y Care to treat the periodontium dental pulp, or “dead” teeth, irregularities in the position of the teeth, artificial dental structures such as crowns, bridges, or dentures, or any other type of dental procedure is excluded. Hydroxyapatite or any other material to make the gums rigid is excluded. It does not matter whether their purpose is to improve conditions inside or outside the mouth (oral cavity). These services, supplies, or expenses are not covered even if they are used to prepare a patient for services or procedures that are plan benefits. For example, braces on the teeth are excluded for any purpose, even to prepare a person with a cleft palate on the bones of the jaw. This does not apply to those services by a physician to treat or replace natural teeth which are harmed by accidental injury covered other covered services.

y Dental implants into, across, or just above the bone and related appliances. Services or expenses to prepare the mouth for dental implants such as those to increase the upper and lower jaws or their borders, sinus lift process, guided tissue regrowth, or any other surgery, bone grafts, hydroxyapatite, and similar materials. These services, supplies, or expenses are not covered even if they are needed to treat conditions existing at birth, while growing, or resulting from an accident. These services, supplies, or expenses are excluded even if they are medically or dentally necessary.

y Services or expenses rendered for any disease, injury or condition arising out of and in the course of employment for which benefits and/or compensation are available in whole or in part under the provisions of any workers’

compensation or employers’ liability laws, state or federal. This applies whether you fail to file a claim under the law. It applies whether the law is enforced against or assumed by the employer. It applies whether the provider of those services was authorized as required by the law. Finally, it applies whether your employer has insurance coverage for benefits under the law.

y Services or expenses in cases covered in whole or in part by workers’ compensation or employees’ liability laws, state, or federal, regardless of whether you file a claim under that law or whether the law is enforced against or assumed by the employer. It applies whether the law provides for hospital or medical services as such. Finally it applies whether your employer has insurance coverage for benefits under the law.

y Services or expenses covered in whole or in part under the laws of the United States, any state, country, city, town, or other governmental agency that provides or pays for care through insurance or any other means. This applies even if the law does not cover all your expenses.

y Services or supplies to the extent that a member is, or would be, entitled to reimbursement under Medicare, regardless of whether the member properly and timely applied for, or submitted claims to, Medicare, except as otherwise required by federal law.

y Routine well-child care, routine immunizations, routine physical examinations except as previously stated.

y Services or expenses for custodial care. Care is custodial when its primary purpose is to provide room and board, routine nursing care, training in personal hygiene, and other forms of self-care or supervisory care by a physician for a person who is mentally or physically disabled.

y Investigational treatment, procedures, facilities, drugs, drug usage, equipment, or supplies including services that are part of a clinical trial.

y Services or expenses for routine foot care such as removal of corns or calluses or the trimming of nails (except mycotic nails).

y Hospital admissions in whole or in part when the patient primarily receives services for rehabilitation like physical therapy, speech therapy, or occupational therapy.

y Services and expenses provided to a hospital patient that could have been provided on an outpatient basis, given the patient’s condition and the services provided. Benefits for those services will apply as though the service were provided on an outpatient basis. Examples are hospital stays primarily for diagnosis, diagnostic study, medical

observation, rehabilitation, physical therapy, and hydrotherapy.

y Services or expenses for, or related to, sexual dysfunctions or inadequacies not related to organic disease or that are related to surgical sex transformations.

y Services or expenses for an accident or illness resulting from war, or any act of war, declared or undeclared, or from riot or civil commotion.

y Services or expenses for treatment of injury sustained in the commission of a crime or for treatment while confined in a prison, jail, or other penal institutions.

y Services or expenses for a claim we have not received within 24 months after services were rendered or expenses incurred.

y Services or expenses for treatment of any condition including, but not limited to, obesity, diabetes, or heart disease, that is based upon weight reduction or dietary control or services or expenses of any kind to treat obesity, weight reduction, or dietary weight reduction or dietary control. This exclusion does not apply to surgery for morbid obesity if medically necessary and in compliance with guidelines of BCBSAL. Benefits will only be provided for one surgical procedure for obesity (morbid) in a lifetime. Benefits will not be provided for subsequent surgery for complications related to a covered surgical procedure for obesity (morbid), if the complications arise from non-compliance with medical recommendations regarding patient activity and lifestyle following the procedure.

y Services or expenses that you are not legally obligated to pay, or for which no charge would be made if you had no health coverage.

y Services or expenses for or related to organ, tissue, or cell transplantations unless specifically allowed by this plan.

y Dental treatment for or related to temporomandibular joint (TMJ) disorders. This includes Phase II, according to the guidelines approved by the Academy of Craniomandibular Disorders. These treatments permanently alter the teeth or the way they meet and include such services as balancing the teeth, shaping the teeth, reshaping the teeth, restorative treatment, and treatment involving artificial dental structures such as crowns, bridges, or dentures; full mouth

rehabilitation; dental implants; treatment for irregularities in the position of the teeth; or a combination of these treatments.

y Services or expenses for or related to Assisted Reproductive Technology (ART) which is any process of taking human eggs or sperm, or both, and putting them into a medium or the body to try to cause reproduction. Examples of ART are in vitro fertilization and gamete intrafallopian tube transfer.

y Eyeglasses or contact lenses or related examination or fittings. One pair of eyeglasses, contact lenses or one pair of each will be covered under other covered services if they replace the lens of the eye after eye surgery or injury or defect.

y Services or expenses for eye exercises, eye refractions, visual training orthoptics, shaping the cornea with contact lenses, or any surgery on the eye to improve vision including radial keratotomy.

y Services or expenses for personal hygiene, comfort, or convenience items, such as air conditioners, humidifiers, whirlpool baths, and physical fitness or exercise apparel. Exercise equipment is also excluded. Some examples of exercise equipment are shoes, weights, exercise bicycles or tracks, weights or variable resistance machinery, and equipment producing isolated muscle evaluations and strengthening. Treatment programs, the use of equipment to strengthen muscles according to preset rules, and related services performed during the same therapy session are also excluded.

y Services or expenses for speech and occupational therapy (except as previously stated as covered), recreational, and educational therapy.

y Services or expenses for acupuncture, biofeedback, and other forms of self-care or self-help training.

y Hearing aids or examinations or fittings for them.

y Services or expenses of a hospital stay if the Plan Administrator or BCBSAL determines that the admission was not medically necessary.

y Services or expenses of private duty nurses unless previously stated as a covered service.

y Services provided by psychiatric specialty hospitals that do not participate with nor are considered members of any Blue Cross and/or Blue Shield Plan.

y Services, care, treatment, or supplies furnished by a provider that is not recognized by the Plan Administrator or BCBSAL as an approved provider for the services rendered.

y Services or expenses any provider rendered to a member who is related to the provider by blood or marriage or who regularly resides in the provider’s household. Examples of a provider include a physician, a licensed registered nurse, a licensed practical nurse, or a licensed physical therapist.

y Services provided by substance abuse facilities including substance abuse residential facilities.

y Services or expenses of any kind for nicotine addiction such as smoking cessation treatment.

y Expenses for prescription drugs, including select specialty medications. (However, outpatient prescription drugs are provided to Co-pay 500 and Co-pay 750 participants through Express Scripts).

y Travel, even if prescribed by your physician.

y Inpatient care or treatment for mental and nervous disorders or disease (including alcoholism and drug addiction) is not covered under basic hospital benefits but is covered under other covered services.

y Services or expenses of any kind provided by a nonparticipating hospital located in Alabama for any benefits under this plan, except for inpatient and outpatient hospital benefits in case of accidental injury, as described above in the covered expenses section.

y Services or expenses for physical therapy that do not require a licensed physical therapist, given the level of simplicity and the patient’s condition, will not further restore or improve the patient’s bodily functions, or is not reasonable as to number, frequency, or duration.

y Services or expenses in any federal hospital or facility except as provided by federal law.

y Services or expenses for sanitarium care, convalescent care, or rest care.

y Anesthesia services or supplies, or both, by local infiltration.

y Services or expenses of any kind for or related to elective abortions.

y Services or expenses of any kind for or related to reverse sterilizations.

y Services provided through teleconsultation.

y Services provided by a nonparticipating renal dialysis facility in Alabama.

y Services, care treatments, or expenses that violate local state or federal law.

Definitions

For purposes of BCBSAL coverage, these terms are defined as follows.

Accidental Injury: A traumatic injury to you caused solely by an accident.

Allowed Amount: Benefit payments for covered services are based on the amount of the provider’s charge that BCBSAL recognizes for payment of benefits. This amount is limited to the lesser of the provider’s charge for care or the amount of that charge that is determined by BCBSAL to be allowable depending on the type of provider utilized and the state in which services are rendered, as described below:

y Preferred Providers: Blue Cross and Blue Shield plans contract with providers to furnish care for a negotiated price. This negotiated price is often a discounted rate, and the preferred provider normally accepts this rate (subject to any applicable co-pays, coinsurance, or deductibles that are the responsibility of the patient) as payment in full for covered services or care. The negotiated price applies only to services that are covered under the Plan and also covered under the contract that has been signed with the preferred provider. Please be aware that not all participating or contracting providers are preferred providers. Each local Blue Cross and/or Blue Shield plan determines which of its participating or contracting providers will be considered preferred providers.

y Non-Preferred Providers: The Allowed Amount for care for non-preferred providers or for services or supplies not included in a preferred provider’s contract is normally determined by the Blue Cross and/or Blue Shield plan where services are rendered. This amount may be based on the negotiated rate payable to preferred providers, or may be based on the average or anticipated charge or discount for care in the area or state, or for care from that particular type of provider. When the local Blue Cross and/or Blue Shield plan does not provide BCBSAL with appropriate pricing data or when BCBSAL is determining the Allowed Amount for services or supplies by a non-preferred provider (or for services and supplies not included in the contact with the provider), Blue Cross and Blue Shield of Alabama determines the Allowed Amount using historical data and information from various sources such as, but not limited to:

ƒ The charge for the same or a similar service;

ƒ The relative complexity of the service;

ƒ The preferred provider allowance for the same or a similar service;

ƒ The average expected or estimated provider discount for the type of provider in the service area, as reported by the Blue Cross and Blue Shield Association from time to time;

ƒ The rate of inflation using a recognized measure; and,

ƒ Other reasonable limits, as required with respect to outpatient prescription drug costs.

Non-preferred providers include providers that have not signed a contract with the Blue Cross and/or Blue Shield plan where services are rendered as well as participating or contracting providers who have not been designated by the local Blue Cross and/or Blue Shield plan as preferred providers.

In this situation the provider may bill the member for charges in excess of the Allowed Amount. The Allowed Amount will not exceed the amount of the provider’s charge.

Assisted Reproductive Technology (ART): Any combination of chemical and/or mechanical means of obtaining gametes and placing them into a medium (whether internal or external to the human body) to enhance the chance that reproduction will occur. Examples of ART include, but are not limited to, in vitro fertilization, gamete intrafallopian tube transfer, zygote intrafallopian tube transfer, and pronuclear stage tubal transfer.

BlueCard Program: An arrangement among Blue Cross Plans by which a member of one Blue Cross Plan receives benefits available through another Blue Cross Plan located in the area where services occur.

Certification of Medical Necessity: The written results of BCBSAL’s review using recognized medical criteria to determine whether a member requires treatment in the hospital before he/she is admitted, or within 48 hours of the next business day after the admission in the case of emergency admissions. Certification of medical necessity means only that a hospital admission is medically necessary to treat your condition. Certification of medical necessity does not mean that your group has paid us all monies due for you. Certification of medical necessity does not consider whether your admission is excluded by this plan.

Charge: The reasonable charge not exceeding the provider’s actual charge regularly and customarily made for those services or supplies. For services or supplies furnished to a member by a preferred provider, charge means the amount for those services or supplies which Blue Cross has agreed upon with the preferred provider. In the case of services or supplies for which a usual, customary and reasonable fee exists (other than a preferred provider), the charge will be the allowed amount.

Concurrent Utilization Review Program (CURP): A program designed to promote the most efficient and effective use of healthcare resources while utilizing cost-effective methods to administer benefits.

Contract: The Group Medical Benefits contract between Lowe’s and BCBSAL. The contract is made up of your employer’s group application for the contract; this summary plan description; and any written change to this summary plan description. Your contract number is listed on your ID card.

Cosmetic Surgery: It includes any surgery done primarily to improve or change the way one appears, but does not primarily improve the way the body works or corrects deformities resulting from disease, trauma, or birth defect. For important information on cosmetic surgery, see “Expenses NOT Covered” on page 19.

Custodial Care: Care primarily to provide room and board for a person who is mentally or physically disabled.

Durable Medical Equipment: Equipment BCBSAL approves as medically necessary to diagnose or treat an illness or injury or to prevent a condition from becoming worse. To be durable medical equipment, an item must be made to withstand repeated use, be for a medical purpose rather than for comfort or convenience, be useful only if you are sick or injured, and be related to your condition and prescribed by your physician for use in your home.

Elective Abortion: An abortion that is not needed due to compromised physical health of the mother, severe chromosomal or fetal deformity, or due to a fetus being conceived due to incest or rape.

Fee Schedule: The schedule of medical and surgical procedures and the fee amounts for those procedures under the preferred medical doctor program and other preferred provider programs as applicable.

Group: The employer, association, or other entity that contracts with BCBSAL and through which you have coverage.

Group Application: The document in which Lowe’s applied for a group benefits plan with BCBSAL.

Hospice: A participating or a nonparticipating hospice.

Hospital: A participating or a nonparticipating hospital.

Inpatient: A registered bed patient in a hospital.

Investigational: Any treatment, procedure, facility, equipment, drugs, drug usage, or supplies including services that are part of a clinical trial that either BCBSAL has not recognized as having scientifically established medical value, or that does not meet generally accepted standards of medical practice.

Medical Emergency: A medical condition that occurs suddenly and without warning with symptoms that are so acute and severe as to require immediate medical attention to prevent permanent damage to health, other serious medical results, serious impairment to bodily function, or serious and permanent lack of function of any bodily organ or part.

Medically Necessary or Medical Necessity: Services or supplies that are necessary to treat your illness, injury, or symptom.

To be medically necessary, services or supplies must be determined by BCBSAL to be:

y Appropriate and necessary for the symptoms, diagnosis, or treatment of your medical condition;

y Provided for the diagnosis or direct care and treatment of your medical condition;

y In accordance with standards of good medical practice accepted by the organized medical community;

y Not primarily for the convenience and/or comfort of you, your family, your physician, or another provider of services;

y Not investigational; and

y Performed in the least costly setting or method required by your medical condition.

A setting may be your home, a physician’s office, a participating ambulatory surgical facility, a hospital’s outpatient department, a hospital when you are an inpatient, or another type of facility providing a lesser level of care. Only your medical condition is considered in deciding which setting is medically necessary. Your financial or family situation, the distance you live from a hospital or other facility, or any other nonmedical factor is not considered. As your medical condition changes, the setting you need may also change. Ask your physician if any of your services can be performed on an outpatient basis, or in a less costly setting.

Member: A Subscriber or eligible dependent that has coverage under the contract. The term Member also refers to a former dependent or Subscriber who was not terminated for gross misconduct and who is eligible for and covered under COBRA.

Mental and Nervous Disorders: These are mental disorders, mental illnesses, psychiatric illnesses, mental conditions and psychiatric conditions. These disorders, illnesses, and conditions are considered mental and nervous disorders whether they are of organic, biological, chemical, or genetic origin. They are considered mental and nervous disorders

however they are caused, based, or brought on. Mental and nervous disorders include, but are not limited to, psychoses, neuroses, schizophrenic-affective disorders, personality disorders, and psychological or behavioral abnormalities associated with temporary or permanent dysfunction of the brain or related system of hormones controlled by nerves. They are intended to include disorders, conditions, and illnesses listed in the current diagnostic and statistical manual of mental disorders.

Nonparticipating Hospice: Any hospice that is not a participating hospice but which meets the conditions for participation in Medicare.

Nonparticipating Hospital: Any hospital (other than a participating hospital) that has been approved by the Alabama Hospital association or the American Hospital Association as a general hospital or meets the requirements of the American Hospital Association for registration or classification as a general medical and surgical hospital.

General hospitals do not include those that are classified or could be classified under standards of the American Hospital Association as special hospitals. Examples of these special hospitals are those classified for psychiatry, alcoholism and other chemical dependency, rehabilitation, mental retardation, chronic disease, or any other specialty. General hospitals do not include facilities primarily for convalescent care or rest or for the aged, school, or college infirmaries, sanitariums, or nursing homes.

Participating Ambulatory Surgical Facility: Any facility with which BCBSAL has a participating ambulatory surgical facility contract for furnishing healthcare services.

Participating Chiropractor: A Doctor of Chiropractic (D.C.) who has an agreement with Blue Cross.

Participating Hospice: Any hospice in the state of Alabama with which Blue Cross has a contract.

Participating Hospital: Any hospital with which a Blue Cross and/or Blue Shield Plan has a contract for furnishing health-care services.

Participating Renal Dialysis Facility: Any freestanding hemodialysis facility with which BCBSAL has a contract for furnishing healthcare services.

Physician: One of the following when licensed and acting within the scope of that license at the time and place you are treated or receive services: Doctor of Medicine (M.D.), Doctor of Osteopathy (D.O.), Doctor of Dental Surgery (D.D.S), Doctor of Medical Dentistry (D.M.D.), Doctor of Chiropractic