Employer News hraveba.org Winter 2014

Contribution Reminders All contribution reports must contain proper coding to either the Standard HRA Plan (001) or Post-separation HRA Plan (002) beginning January 20, 2014. Use of the improved Contribution Report Template is required if you upload reports via your online employer portal. Use of the new template is recommended if you submit your reports via email, fax, or regular mail.

No Tax Reporting You DO NOT need to report HRA VEBA Plan coverage on Forms W-2 for the 2013 calendar year.

Marketplace Premium Tax Credit Eligibility Participants who purchase insurance through a marketplace exchange and want to qualify for the Premium Tax Credit should (1) read the Facts about Premium Tax Credit Eligibility handout available online at hraveba.org under Quicklinks and (2) consider whether they will need to first use up, limit, or waive their HRA VEBA benefits.

Meritain Health Email Reminder Please do not share the participantdata@meritain.com email address with your employees-it is for employer use only.

Enrollment Form Reminders You can specify participant effective dates for newly-enrolling employees. Also, make sure Enrollment Forms you submit are fully completed, legible, and signed by the employee.

PCORI Fee Reminder The Patient-Centered Outcomes Research Institute (PCORI) fee is not an administrative fee. Federal health care reform imposes the fee on all group health plans.

Divorce and Military Service (USERRA) Reminders If a participant becomes divorced, his or her participant account cannot be split as a cash distribution. Claims-eligible participants may continue to file claims for qualified expenses while on military leave.

An improved Contribu on Report Template and updated Contribu on Instruc ons were emailed to all employers from VEBA Service Group (VSG) on December 20, 2013. Both of these items are a ached for your convenience. Please read the following reminders: 1. Beginning January 20, 2014, you must

properly code all contribu ons to either the Standard HRA Plan (001) or Post-separa on HRA Plan (002). Contribu on reports received without proper coding will not be processed un l a er Meritain Health contacts you to obtain the proper coding. Examples of proper coding

Contribution Reminders

-continued on reverse

are contained in the updated Contribu on Instruc ons.

2. The improved Contribu on Report Template (copy a ached) contains a new “Division” column in which you must indicate, row by row, the appropriate division (i.e. plan) to which contribu ons should be applied. Enter division code 001 for Standard HRA Plan contribu on or 002 for Post-separa on HRA Plan contribu ons.

3. If you upload contribu on reports via your online employer portal, you must use the new Contribu on Report Template beginning January 20, 2014. Meritain Health’s system will accept only the old template through January 19, 2014 and only the new template beginning January 20, 2014. Use of the new template is

recommended if you submit your contribu on reports via email, fax, or regular mail.

4. You now have the op on of sending separate or combined contribu on reports when making contribu ons to the Standard and Post-separa on HRA Plans. Either way, your reports must contain proper coding as described above.

If you have ques ons or need assistance with the contribu on process, please contact Meritain Health at par cipantdata@meritain.com or 1-888-659-8828.

No Tax Reporting

HRA VEBA Plan coverage does NOT need to be reported on Forms W-2 for the 2013 calendar year. IRS No ce 2012-9 confirmed that coverage under a health reimbursement arrangement (HRA), such as the HRA VEBA Plans, is excludable from repor ng on Form W-2. You will not have to report HRA VEBA Plan coverage for subsequent years unless the IRS publishes new guidance at a future date.

Marketplace Premium Tax Credit Eligibility

Spokane & Idaho 1-800-888-8322

Sumner 1-800-422-4023

Vancouver 1-877-695-3945

Richland 1-855-565-2555

www.hraveba.org Third-party Administrator

Meritain Health | 1-888-659-8828

Star ng in 2014, certain par cipants may qualify for the Premium Tax Credit if they (or a family member) purchase coverage through a state or federal marketplace exchange. The Premium Tax Credit subsidizes a por on of the premiums for health insurance purchased through a marketplace exchange for those who qualify. Go to www.irs.gov/uac/The-Premium-Tax-Credit for more informa on.

Employer News Page Two

Winter 2014

Meritain Health Email Reminder

Please provide the Facts About Premium Tax Credit Eligibility handout to your par cipants who come to you with ques ons about the Premium Tax Credit and their HRA VEBA account. The most current version of this handout is available at hraveba.org under Quicklinks. The January 2014 issue of Par cipant News (copy a ached), which will be included with the par cipant account statement mailing later this month, contains informa on for par cipants and directs them to the Facts About Premium Tax Credit Eligibility handout available online for more details.

- continued from page 1

Please note that the par cipantdata@meritain.com email address is for employer use only. Please do not share this email address with par cipants. Par cipant use of this email address delays response me to both employer and par cipant inquiries. Par cipant ques ons regarding claims should be sent to myclaims@meritain.com. All other par cipant ques ons should be sent to myHRAVEBA@meritain.com.

Enrollment Form Reminders

You can specify a newly-enrolling employee’s Claims Eligibility Date under the Standard HRA Plan by entering the desired date in the space provided within the shaded Employer box at the top of the Enrollment Form. If Meritain Health receives a form that does not include a specified date, the default Standard HRA Plan Claims Eligibility Date will be the la er date upon which Meritain Health has received both the Enrollment Form and the first contribu on on behalf of the par cipant. This may not always be the date you intend for claims eligibility to begin. Please remember to specify a Claims Eligibility Date on each Enrollment Form when enrolling employees into the Standard HRA Plan to ensure your employees are able to file claims for expenses incurred on or a er the intended date. A par cipant’s Claims Eligibility Date under the Post-separa on HRA Plan is the date upon which they separate from service or re re. Addi onally, please remind your employees to fully complete their Enrollment Forms in a legible manner and to sign their forms. Illegible, incomplete, or unsigned forms usually result in processing delays.

PCORI Fee Reminder

Federal health care reform rules require a per-par cipant fee to pay for clinical effec veness research conducted by the Pa ent-Centered Outcomes Research Ins tute (PCORI). The PCORI fee for the 2013-14 plan year is $2.00 per claims-eligible par cipant. Health care reform imposes this fee on all group health plans; it is not an administra ve fee. The PCORI fee applies to claims-eligible par cipants only and is prorated and deducted from par cipant accounts quarterly.

Divorce and Military Service (USERRA) Reminders

In the event a par cipant becomes divorced or legally separated, their account cannot be split as a cash distribu on. Par cipants should contact the TPA for more informa on. If a par cipant is on military leave governed by the Uniform Services Employment and Reemployment Rights Act (USERRA), they may con nue to file claims for qualified expenses. If they do not con nue to receive contribu ons due to military leave, they may elect to make voluntary, a er-tax contribu ons to their account under COBRA. Par cipants should contact Meritain Health for more informa on.

Insert Contribution Report Date (99-99-9999): 99-99-9999 Insert Your Name:

Insert Your Employer ID No.: Insert Your Employer Name:

Input Total Contribution Amount:

SSN (optional, unless first-time contribution) Participant Account No. Division First Name Last Name Middle Initial Amount

Contribution Instructions

(12-13) PRC Page 1 of 5

Introduction

You are encouraged to submit contribution reports and contributions electronically. This helps ensure more timely and accurate

processing. Please pay close attention to the separate instructions for sending contribution reports and contributions. For your

convenience, these instructions are divided into three sections:

Section 1: Sending Contribution Reports (electronically, or via e-mail, fax, or U.S. Mail)

Section 2: Sending Contributions (electronically, or via paper check to secure lockbox)

Section 3: Notes and Reminders

Section 1. Sending Contribution Reports

Below are instructions for sending contribution reports to the third-party administrator (TPA), Meritain Health. Use of the

Contribution Report Template (see page 5 for sample) and uploading it via your online employer portal is recommended, or you

may manually create and upload a contribution report after logging in to your online employer portal at hraveba.org. You can also

send contribution reports via e-mail, fax, and U.S. Mail.

Your contribution reports must indicate whether you are making contributions to the Standard HRA Plan or the Post-separation

HRA Plan. The Contribution Report Template contains a “Division” column in which you must indicate, row by row, the appropriate

division (i.e. plan) to which contributions should be applied. For example, enter division code 001 to direct contributions to the

Standard HRA Plan or division code 002 to direct contributions to the Post-separation HRA Plan. Separate reports for each plan

are not required. You may send combined or separate reports for each plan when using the Contribution Report Template, but the

“Division” column must be populated either way.

To avoid unnecessary processing delays, your contribution reports must be properly coded. If you do not use the Contribution

Report Template, you still must code your reports. Examples of proper coding include: (1) entering or writing division code 001 or

002 as an extension to your Employer ID Number on the contribution report; or (2) noting the proper division code in some other

manner, so long as it is prominent and legible. Proper coding must appear directly on your contribution reports and not merely

within an email or other form of cover. Contribution reports received without identifiable coding will not be processed until after

proper coding instructions are received from the employer.

At a minimum, contribution reports must include:

1. Employer ID number (assigned by Meritain Health)

2. Division code 001 for Standard HRA Plan contributions or 002 for Post-separation HRA Plan contributions as described

above;

3. Participant SSN (required for first-time contributions) or participant account number* (assigned by Meritain Health);

4. Participant last name;

5. Participant first name; and

6. Contribution amount.

*Please note that if a participant has an account in more than one plan, he or she will have more than one participant account number. If you choose to submit

your contribution reports using participant account numbers, the account number you use must be the participant account number as assigned by Meritain

Health for the division (i.e. plan) to which you are remitting contributions.

The Contribution Report Template can be downloaded from your online employer portal after logging in at hraveba.org, or can be

requested from the TPA by e-mailing participantdata@meritain.com. A sample Contribution Report Template is included with these

instructions on page 5. If you have questions, please contact the TPA at participantdata@meritain.com or 1-888-659-8828.

Instructions for submitting contribution reports via ASCII Text file are available upon request.

Contribution Instructions

(12-13) PRC Page 2 of 5

NOTE: Please do not send original or duplicate contribution reports to the secure lockbox address. The lockbox is for paper check

contributions only. HRA VEBA Trust incurs additional banking fees when contribution reports are sent to the lockbox.

1(a). Contribution Report Template upload via online employer portal (recommended)

When uploading contribution data via Excel spreadsheet, use of the TPA’s Contribution Report Template is mandatory. It is

important to include all of the required information as this information is used to verify participant account information each time a

contribution is received by the TPA.

Files may be uploaded to the TPA via your online employer portal after logging in at hraveba.org. After logging in, click

Upload/Transmit contribution data and follow the instructions. Repeat this process in advance each time you submit contributions.

1(b). Manual creation and upload of contribution data via online employer portal

Another option for submitting contribution data electronically is to manually create and upload contribution data from your online

employer portal after logging in at hraveba.org. After logging in, click Upload/Transmit contribution data. Follow the instructions to

manually upload the required data for each participant receiving a contribution. Repeat this process in advance each time you

submit contributions.

1(c). Alternative contribution report submission methods

If you choose to not use either of the electronic methods, three alternative methods are available: e-mail, fax, and U.S. Mail. The

TPA needs these reports at least three, and preferably five, days before receipt of funds.

E-mail, fax, or mail your contribution reports to the TPA as follows:

a. E-mail

E-mail your contribution report to the TPA at participantdata@meritain.com. It is recommended you use an internet e-mail

encryption service to ensure the privacy and security of your contribution data. This process must be completed three to

five days prior to submitting contributions.

b. Fax

Fax your contribution report to the TPA at (763) 582-3471. This process must be completed three to five days prior to

submitting contributions.

c. U.S. Mail

Mail your contribution report to the TPA at:

HRA VEBA Third-party Administrator Meritain Health PO Box 27810 Minneapolis, MN 55427-0810

This process must be completed three to five days prior to submitting contributions.

NOTE: Please do not use the above mailing address for sending contributions via paper check. See item 2(c) below for the secure lockbox address for paper check contributions.

Contribution Instructions

(12-13) PRC Page 3 of 5

Section 2. Sending Contributions Electronically (recommended) or Via Paper Check to Secure Lockbox

Below are instructions for sending contributions. Sending contributions electronically via Automated Clearing House (ACH) or wire

transfer is recommended, or you may submit contributions via paper check to the secure lockbox.

NOTE: Please do not mail paper check contributions directly to Meritain Health. See item 2(c) below for the secure lockbox address for paper

check contributions. Also, do not send original or duplicate contribution reports to the secure lockbox address. The lockbox is for paper check

contributions only. HRA VEBA Trust incurs additional banking fees when contribution reports are sent to the lockbox.

To help ensure timely processing, please submit your contribution reports three to five days prior to sending contributions. In

addition, a completed and signed Participant Enrollment Form for each new participant receiving a contribution must be submitted

to and received by the TPA three to five days prior to submitting contributions.

2(a). Automated Clearing House (ACH)

Use the following information to complete an Electronic Funds Transfer (EFT) via ACH.

Bank: Washington Trust Bank Routing Number: 125100089 Account Number: 1003659497 Address: PO Box 2127, Spokane, WA 99210

2(b). Wire transfer

Use the following information to complete an EFT via wire transfer. Your bank may charge a fee for this service. Bank: Washington Trust Bank Address: 717 W Sprague Ave, Spokane, WA 99201 Routing Number: 125100089 Account Number: 1003659497

FBO: Meritain Health, Inc.

2(c). Paper check

Mail paper check contributions to HRA VEBA Trust’s secure lockbox. Please do not mail paper checks directly to Meritain Health and do not enclose original or duplicate contribution reports with your paper checks. Paper checks must include your employer ID number (assigned by Meritain Health) on the memo line.

Payee: HRA VEBA Trust Lockbox address: HRA VEBA Trust Contributions PO Box 807 Spokane, WA 99210-0807

Contribution Instructions

(12-13) PRC Page 4 of 5

Section 3. Notes, Reminders, and TPA Contact Information

The TPA cannot hold employer contributions received without a completed and signed Participant Enrollment Form per the

terms of the HRA VEBA Plan. Contributions received without the required form will be returned to the employer, without

earnings, after 90 days following the receipt of the initial contribution.

Negative contribution amounts will not be accepted by the TPA. If an administrative error or mistake of fact occurs, which

results in funds being posted to a participant’s account in error, you will need to complete a Mistake of Fact form to request the

return of those funds. Please contact the TPA for assistance at participantdata@meritain.com or 1-888-659-8828.

The accuracy and completeness of the contribution reports provided to the TPA is essential to ensure funds are applied to

participant accounts timely and accurately. Reports that do not match the actual contribution amount submitted will result in

posting delays.

Contributions are NOT tax reportable and are not required to be reported on Form W-2 and should not be reported on Form

1099.

Have questions about contribution remittance? Contact the TPA, Meritain Health, at participantdata@meritain.com or 1-888-

659-8828.

Contribution Instructions

Page 5 of 5

Contribution Report Template

Use of the Contribution Report Template is mandatory if you upload contribution reports via your online employer portal, and it is recommended if you submit contribution reports via email, fax, or regular mail. The Contribution Report Template can be downloaded from your online employer portal after logging in at hraveba.org, or can be requested from the TPA by e-mailing participantdata@meritain.com. A sample of the file format is provided below.

Insert Contribution Report Date (99-99-9999): 99-99-9999

Insert Your Name:

Insert Your Employer ID No.:

Insert Your Employer Name:

Input Total Contribution Amount:

SSN (optional, unless first-time contribution)

Participant Account No. Division First Name Last Name

Middle Initial Amount

Below are instructions and helpful reminders to assist you in using the Contribution Report Template.

1. Enter the report summary information at the top of the Contribution Report Template.

2. Enter the following data for each participant: a. Participant SSN (required for first-time contributions) or participant account number (assigned by Meritain Health); b. Division code 001 for Standard HRA Plan contributions or 002 for Post-separation HRA Plan contributions; c. Participant first name; d. Participant last name; e. Participant middle initial (if applicable); and f. Contribution amount (do not use formulas or cell formatting (e.g. rounding) in this column).

To copy and paste data from a separate Excel file to the Contribution Report Template, select the data that you would like to copy and use the Paste Special function to paste the Values only. Select Values in the Paste Special dialogue box to preserve the formatting of the Contribution Report Template when pasting data into the spreadsheet.

3. Use the Save As function to save the file as an Excel file (.xls or .xlsx). When saving the spreadsheet, include your employer

ID number in the spreadsheet’s filename.

4. Upload the file via your online employer portal using the instructions provided online, or e-mail the file to Meritain Health at participantdata@meritain.com.

Helpful reminders:

Do not use password protection on contribution data files uploaded via your online employer portal.

Contribution data files sent via e-mail may contain password protection, but the password must be sent under separate cover to Meritain Health.

Make sure your contribution reports contain proper coding: 001 for Standard HRA Plan contributions or 002 for Post-separation HRA Plan contributions.

Remit funds matching the dollar amount on your contribution data file electronically (recommended) via ACH or wire transfer or via paper check to the Trust’s secure lockbox.

PSE19 (12/13)

HRA VEBA Third-party Administrator

Meritain Health

P.O. Box 27810

Minneapolis, MN 55427-0810

1-888-659-8828

myHRAVEBA@meritain.com

Beginning in January 2014, health care reform regulations do not allow the Standard HRA Plan to accept contributions for eligible employees who (1) are not eligible to enroll in their employer’s group health plan or (2) are otherwise not enrolled in or covered by their employer’s group health plan or any other qualified group health plan. Employers will direct contributions for these employees to the new Post-separation HRA Plan, which is designed to comply with applicable health care reform regulations by providing benefits only after separation from service or retirement. If you think you may be affected by the plan design change, read the Participant FAQ available online at hraveba.org under Important Notices.

Participant News hraveba.org January 2014

Plan Design Change

Plan Design Change If you are (1) not eligible to enroll in your employer’s group health plan or (2) are otherwise not enrolled in or covered by your

employer’s group health plan or any other qualified group health plan, your future HRA VEBA contributions, if any, will likely

be directed to the new Post-separation HRA Plan.

Investment Fund Change Reminder The investment fund changes occurred as scheduled in October 2013. No action is required by you.

No Tax Reporting Your HRA VEBA account is tax-exempt and does not require any tax reporting.

Privacy Notice An updated Privacy Notice is enclosed for your files.

Divorce and Military Service Reminders If you become divorced, your participant account cannot be split as a cash distribution. You may continue to file claims for

qualified expenses while on military leave.

Medicare Secondary Payer Notice Federal rules govern who pays first, HRA VEBA or Medicare.

Benefits for Legally-married, Same-sex Spouses Now Available Same-sex spouse benefits are available effective September 16, 2013; certain eligibility requirements apply in accordance

with federal law.

PCORI Fee Reminder The Patient-Centered Outcomes Research Institute (PCORI) fee is not an administrative fee. Federal health care reform

imposes the fee on all group health plans.

Premium Tax Credit Eligibility and Your HRA VEBA Account If you (1) purchase insurance through a marketplace exchange and (2) want to qualify for the Premium Tax Credit, you should

read the Facts about Premium Tax Credit Eligibility handout available online at hraveba.org under Quicklinks or by request

from Meritain Health and consider whether you will need to first use up, limit, or waive your HRA VEBA benefits.

-continued on page 2

Generally, for your employer to direct its contributions for you to the Standard HRA Plan, you must (1) be eligible to enroll in your employer’s group health plan and (2) be enrolled in or covered by your employer’s group health plan or attest to your employer that you are enrolled in or covered by another qualified group health plan. HRA VEBA accounts for such participants are considered to be “integrated” with a qualified group health plan. You should contact your employer if you have questions about your eligibility for contributions to either the Standard HRA Plan or Post-separation HRA Plan.

Investment Fund Change Reminder

The pre-mixed portfolio investment options were replaced by a suite of Vanguard LifeStrategy funds on October

7, 2013, as communicated in the July 2013 issue of Participant News. Also, the American Funds EuroPacific Growth fund changed to a lower-cost share class of the same fund at that time. This activity is reflected on your Participant Account Statement if you had your account invested in one of the pre-mixed portfolios or had allocated all or a portion of your account to the American Funds EuroPacific Growth fund. No action is required by you.

Participant News Page Two

January 2014

-continued from page 1

No Tax Reporting

Your HRA VEBA account is tax-exempt and does not require any tax reporting. Contributions will not be reported on your 2013 Form W-2 from your employer and should not be reported on your Form 1040 personal tax return. In addition, you will not receive a Form 1099 for any investment earnings or withdrawals (claims).

Privacy Notice

Enclosed is an updated Privacy Notice, which became effective September 23, 2013. The Plan’s Privacy Notice informs you of the ways the Plan may use and disclose protected health information (PHI) about you. It also describes your rights regarding the use and disclosure of PHI and how you can access such information. If, at any time, you would like a copy of the Plan's Privacy Notice, you may obtain it online at hraveba.org or upon request by contacting the third-party administrator, Meritain Health, at participantdata@meritain.com or by calling 1-888-659-8828.

Divorce and Military Service Reminders

If you become divorced or legally separated, be aware that your account cannot be split as a cash distribution. Please contact Meritain Health for more information. If you are on military leave governed by the Uniformed Services Employment and Reemployment Rights Act (USERRA), you may continue to file claims for qualified expenses. Furthermore, if you do not continue to receive contributions due to military leave, you may elect to make voluntary after-tax contributions to your account under COBRA. Please contact Meritain Health for more information.

Medicare Secondary Payer Notice

If you are entitled to Medicare and your HRA VEBA account is claims-eligible, federal law governs who should pay or reimburse your medical expenses first. To find out how the rules may apply to you, go to hraveba.org and click Who pays first, HRA VEBA or Medicare? under Quicklinks. Your plan’s Coordination of Benefits with Medicare notice is contained in the Plan Summary. The Plan Summary is available online at hraveba.org under Plan Information & Enrollment or by request from Meritain Health. To comply with federal law, you should file your claims in accordance with these primary and secondary payer rules.

Benefits for Legally-married, Same-sex Spouses Now Available

As of September 16, 2013, same-sex spouses who are legally married to a participant are eligible for benefits (reimbursements) under the HRA VEBA Plan. If you are eligible to file claims and are legally married to a same-sex spouse, this means that you may request reimbursement of your same-sex spouse’s eligible, out-of-pocket healthcare costs incurred on or after September 16, 2013. Same-sex spousal benefits (reimbursements) are only available if you were legally married in a state or foreign country that recognizes your marriage, regardless of where you live now. Individuals who are in registered domestic partnerships, civil unions, or other similar formal relationships that are not legal marriages under state law are not eligible for benefits because such individuals are not considered to be married or spouses for federal tax purposes. As background, in June 2013 the Supreme Court struck down a key part of the federal Defense of Marriage Act that limited the terms “spouse” and “marriage” to couples of the opposite sex. The IRS subsequently issued

regulatory guidance in the form of Revenue Ruling 2013-17 that recognized the jurisdiction of celebration of the marriage to determine legal status, regardless of the couple’s state of residency at any time thereafter. If you have questions about benefits under the Plan, please contact Meritain Health.

PCORI Fee Reminder

Federal health care reform rules require a per-participant fee to pay for clinical effectiveness research conducted by the Patient-Centered Outcomes Research Institute (PCORI). Health care reform imposes this fee on all group health plans; it is not an administrative fee. The PCORI fee applies to claims-eligible participants only and is prorated and deducted from your account quarterly.

Premium Tax Credit Eligibility and Your HRA VEBA Account

If you (1) purchase insurance through a marketplace exchange and (2) want to qualify for the Premium Tax Credit, you should go to www.irs.gov/uac/The-Premium-Tax-Credit to learn more about Premium Tax Credit eligibility. Then, to understand your options you should carefully read the Facts About Premium Tax Credit Eligibility handout available online at hraveba.org under Quicklinks or by request from Meritain Health. If you believe that your HRA VEBA account is the only reason you are not eligible for the Premium Tax Credit, you may need to consider (1) using up your HRA VEBA account; (2) electing Pre-Medicare Limited-Scope coverage; or (3) electing to permanently waive all future reimbursements from your HRA VEBA account. You may have other options as well. Also, keep in mind that other factors, besides your claims-eligible HRA VEBA account, could cause you to be ineligible for the Premium Tax Credit, which means you may not need to take any action at all under your HRA VEBA account.