9/30/09

From: Jim Brown, Benefits Team Leader

The BSA medical program is a self-funded medical plan, which means our medical and prescription drug claims are paid by the pool of money employees and councils pay in monthly contributions, not by an insurance company. The actions suggested are already performed as part of the BSA's responsibility that comes with offering an employee medical program. As a self-funded medical plan:

* The design of our plan (the coverage provided) is determined by BSA and the National Executive Board of Directors who sponsor the plan, with significant support from internal and outside experts on medical benefit programs and the health care market.
* Our current program's benefits emerged from a task force of BSA medical plan participants, retirees, scout executives and volunteers working with BSA and our outside consulting experts.
* The plan contracts with a vendor (UnitedHealthcare) to perform administrative services such as:
1. developing and contracting with a network of health care providers to provide the best quality of care at the lowest cost possible;
2. processing and paying our medical claims in accordance with the terms of our medical plan;
3. providing additional services to enhance and deliver a greater benefit value to our plan's participants (including programs such as our Employee Assistance Program, Personal Health Support, Disease Management Program, and Cancer Resource Services).
* These contracted services are provided at a very competitive cost, which is reviewed on a regular basis to ensure our employee and employer dollars are spent wisely.
* 95% of our employee and employer contributions are spent directly on claims, projected to be nearly $54 million in 2010;
* The 5% spent on a claims administrator to negotiate discounts with network providers saves employees and councils from spending as much as 45% or $22.7 million dollars more a year on our claims;
* Administrative services are rebid on a regular basis to ensure we are contracting with the vendor that provides the best opportunity for BSA savings and quality of service.

* Our team of experts constantly monitors the adequacy of the benefits our plan provides for the costs we can afford, as well as ensure the benefits we provide are competitive with other employers' benefit plans, regardless of whether those plans are insured or self-funded.

Our experts are doing everything they can to hold our medical costs down. As participants and consumers of health care, we can help by taking better care of our personal health, which can reduce our number of claims and prescription drugs we take. In turn, fewer claims and drugs means lower costs for ourselves and our council.