Applied Industrial Controls - Benefit Guide 6/1/22 - 5/31/23

2022-2023

BENEFIT GUIDE June 1, 2022 – May 31, 2023

TABLE OF CONTENTS Page 2

A Smarter Way to Better Health

Page 3

Eligibility & Enrolling

Page 4-6

Medical Plans

Page 7

Health Savings Account (HSA)

Page 8

Dental Plan

Page 9

Vision Plan

Page 10

Life/AD&D Insurance and Voluntary Life/AD&D

Page 11

Disability Insurance

Page 12-16 Accident and Critical Illness At Applied Industrial Controls we know that our employees are crucial to our success. That’s why we provide you with an excellent, diverse benefits package that helps protect you and your family now and into the future.

This Benefit Guide outlines the health and welfare plans offered to you and your family. It contains general information and is meant to provide a brief overview. For complete details regarding each benefit plan offered, please refer to the individual plan documents as the information contained herein is for illustrative purposes. Details can be found in the plan specific Summary Plan Description(s) and/or Summary of Coverage. In the case of a discrepancy the plan specific documents will prevail.

Page 17

Employee Contributions

Page 18

Ease (to Enroll) Directions

Page 19

Key Contacts

Page 20-29 Model Notices

Applied Industrial Controls Benefit Guide | 1

A SMARTER WAY TO BETTER HEALTH It’s Your Health.

Get Involved.

Your health is a work in progress that needs your consistent attention and support.

Each choice you make for yourself and your family is part of an ever-changing picture.

Taking steps to improve your health such as going for annual physicals and living a healthy lifestyle can make a positive impact on your well-being.

It’s up to you to take responsibility and get involved, and we are please to offer programs that will support your efforts and help you reach goals.

Preventive Health Care Services

Preventive care includes services like checkups, screenings and immunizations that can help you stay healthy and may help you avoid or delay health problems. Many serious conditions such as heart disease, cancer, and diabetes are preventable and treatable if caught early. It’s important for everyone to get the preventive care they need. Some examples of preventive care services are: o o o o

Blood pressure, diabetes, and cholesterol tests Certain cancer screenings, such as mammograms, colonoscopies Counseling, screenings and vaccines to help ensure healthy pregnancies Regular well-baby and well-child visits

Immunizations

Some immunizations and vaccinations are also considered preventive care services.

Standard immunizations recommended by the Centers for Disease Control (CDC) Include: hepatitis A and B, diphtheria, polio, pneumonia, measles, mumps, rubella, tetanus and influenza although these may be subject to age and/or frequency restrictions.

Understanding What’s Covered

Generally speaking, if a service is considered preventive care, it will be covered at 100%. If it’s not, it may still be covered subject to a copay, deductible or coinsurance.

The Affordable Care Act (ACA) requires that services considered preventive care be covered by your health plan at 100% in-network, without a copay, deductible or coinsurance. To get specifics about your plan’s preventive care coverage, call the customer service number on your member ID card. You may want to ask your doctor if the services you’re receiving at a preventive care visit (such as an annual checkup) are all considered standard preventive care.

If any service performed at an annual checkup is as a result of a prior diagnosed condition, the office visit may not be processed as preventive and you may be responsible for a copay, coinsurance or deductible. To learn more about the ACA or preventive care and coverage, visit www.healthcare.gov.

Applied Industrial Controls Benefit Guide | 2

ELIGIBILITY & ENROLLMENT Who is Eligible to Join the Benefit Plan?

Qualifying Event Changes

You and your dependents are eligible to join the health and our company welfare benefit plans if you are a fulltime employee regularly scheduled to work 30 hours per week. You must be enrolled in the plan to add dependent coverage.

You are allowed to make changes to your current benefit elections during the plan year if you experience an IRS-approved qualifying change in life status. The change to your benefit elections must be consistent with and on account of the change in life status.

IRS-approved qualifying life status changes include: •

Marriage, divorce or legal separation

•

Birth or adoption of a child or placement of a child for adoption

•

Death of a dependent

•

Change in employment status, including loss or gain of employment, for your spouse or a dependent

•

Change in work schedule, including switching between full-time and part-time status, by you, your spouse or a dependent

*Your child’s spouse and a child for whom you are not the legal guardian are not eligible.

•

Change in residence or work site for you, your spouse, or a dependent that results in a change of eligibility

The Dependent Maximum Age Limits is up to age 26.

The dependent does not need to be a full-time student; does not need to be an eligible dependent on parent’s tax return; is not required to live with you; and may be unmarried or married.

•

If you or your dependents lose eligibility for Medicaid or the Children’s Health Insurance Program (CHIP) coverage

•

If you or your dependents become eligible for a state’s premium assistance subsidy under Medicaid or CHIP

Who is an Eligible Dependent?

•

Your spouse to whom you are legally married

•

Your dependent child under the maximum age specified in the Carriers’ plan documents including: ▪ Natural child ▪ Adopted child ▪ Stepchild ▪ Child for whom you have been appointed as the legal guardian

Once the dependent reaches age 26, coverage will terminate on the last day of the birth month.

A totally disabled child who is physically or mentally disabled prior to age 26 may remain on the if the child is primarily dependent on the enrolled member for support and maintenance.

When Do Benefits Become Effective?

Your benefits become effective on the first day of the month following 30 days of employment as a full-time employee with Applied Industrial Controls.

If you have a life status change, you must notify the company within 60 days for changes in life status due to a Medicare or CHIP event and within 30 days of the other events.

If you do not notify the company during that time, you and/or your dependents must wait until the next annual open enrollment period to make a change in your benefit elections.

!

Annual Open Enrollment?

Each year during the annual Open Enrollment Period, you are given the opportunity to make changes to your current benefit elections. To find out when the annual Open Enrollment Period occurs, contact Human Resources.

Please note, loss of coverage due to non-payment or voluntary termination of other coverage outside a spouse’s or parent’s open enrollment is not an IRS-approved qualifying life event and you do not qualify for a special enrollment period.

Applied Industrial Controls Benefit Guide | 3

MEDICAL PLAN OPTION 1 – $3500 DEDUCTIBLE OAP

Medical BASE Plan 1 – Open Access Plus Network $3500 100% Plan Highlights

In Network – You Pay

Out-of-Network – You Pay

$3,500 Individual | $7,000 Family

$10,500 Individual | $31,500 Family

0% after deductible

50% after deductible

Annual Out-of-Pocket Maximum

$6,500 Individual | $13,000 Family

$20,500 Individual | $61,500 Family

Primary Care Physician Office Visit

$25 copay

Deductible, then 50%

Deductible, then $65 copay

Deductible, then 50%

Plan pays 100%

Deductible, then 50%

Deductible, then 0% at Free-standing facility or Hospital

Deductible, then 50%

Hospital Inpatient Care

Deductible, then 0%

Deductible, then 50%

Outpatient Surgery

Deductible, then 0%

Deductible, then 50%

Deductible, plus $300 copay

Paid as In-network

$75 copay

Deductible, then 50%

Deductible includes 4th quarter carryover Coinsurance

Specialist Office Visit Preventive Care Services Complex Imaging Services (CT Scans, PET Scans & MRI’s)

Emergency Room Urgent Care

Prescription Drugs

You pay either a copay &/or coinsurance per the assigned prescription drug tier which can be found in the prescription drug formulary. This plan meets the CMS standard for creditable prescription drug coverage.

Brand Rx Deductible: $150 individual/$300 family (waived for Tier 1) Quantity Limits: Retail = 30-day supply; Mail-Order = 90-day supply

Tier 1 — Generic Drugs

$10 copay

Not covered

Tier 2 — Preferred Brand-Name

$45 copay after Rx deductible

Not covered

Tier 3 — Non-Preferred Brand-Name

$75 copay after Rx deductible

Not covered

20% up to $250 after Rx deductible

Not covered

2 x Retail copay

Not covered

Tier 4 - Specialty Drugs Mail-Order 90-day supply

!

The prescription drug coverage provided by the $3,500 deductible Point of Service medical plan is expected to pay out as much as standard Medicare prescription drug coverage pays. This is important because members who enroll in a Medicare prescription drug plan after their initial eligibility period, may pay a higher premium (a penalty) if they were enrolled in a group health plan with non-creditable prescription drug coverage.

Applied Industrial Controls Benefit Guide | 4

MEDICAL PLAN OPTION 2 – $3000 DEDUCTIBLE OAP

Medical BUY UP Plan 2 – Open Access Plus Network $3000 100% Plan Highlights

In Network – You Pay

Out-of-Network – You Pay

$3,000 Individual | $6,000 Family

$6,000 Individual | $18,000 Family

0% after deductible

50% after deductible

Annual Out-of-Pocket Maximum

$6,000 Individual | $12,000 Family

$16,000 Individual | $48,000 Family

Primary Care Physician Office Visit

$30 copay

Deductible, then 50%

Specialist Office Visit

$60 copay

Deductible, then 50%

Plan pays 100%

Deductible, then 50%

Deductible, then 0% at Free-standing facility or Hospital

Deductible, then 50%

Hospital Inpatient Care

Deductible, then 0%

Deductible, then 50%

Outpatient Surgery

Deductible, then 0%

Deductible, then 50%

$300 copay

Paid as In-network

$75 copay

Deductible, then 50%

Deductible includes 4th quarter carryover Coinsurance

Preventive Care Services Complex Imaging Services (CT Scans, PET Scans & MRI’s)

Emergency Room Urgent Care

Prescription Drugs

You pay either a copay &/or coinsurance per the assigned prescription drug tier which can be found in the prescription drug formulary. This plan meets the CMS standard for creditable prescription drug coverage.

Deductible: None Quantity Limits: Retail = 30-day supply; Mail-Order = 90-day supply

Tier 1 — Generic Drugs Tier 2 — Preferred Brand-Name Tier 3 — Non-Preferred Brand-Name

$10 copay $35 copay $70 copay

Not covered Not covered Not covered

Tier 4 - Specialty Drugs

20% up to $250

Not covered

Mail-Order 90-day supply

2 x Retail copay

Not covered

!

The prescription drug coverage provided by the $3,000 deductible Point of Service medical plan is expected to pay out as much as standard Medicare prescription drug coverage pays. This is important because members who enroll in a Medicare prescription drug plan after their initial eligibility period, may pay a higher premium (a penalty) if they were enrolled in a group health plan with non-creditable prescription drug coverage.

Applied Industrial Controls Benefit Guide | 5

MEDICAL PLAN OPTION 3 – HSA $4000 DEDUCTIBLE

Medical HIGH DEDUCTIBLE Plan 3 – Open Access Plus Network HSA $3500 Plan Highlights

In Network – You Pay

Out-of-Network – You Pay

$3,500 Individual | $7,000 Family

$7,000 Individual | $14,000 Family

0% after deductible

20% after deductible

Annual Out-of-Pocket Maximum

$3,500 Individual | $7,000 Family

$7,000 Individual | $14,000 Family

Primary Care Physician Office Visit

Deductible, then 0%

Deductible, then 20%

Specialist Office Visit

Deductible, then 0%

Deductible, then 20%

Plan pays 100%

Deductible, then 20%

Deductible, then 0% at Free-standing facility or Hospital

Deductible, then 20%

Hospital Inpatient Care

Deductible, then 0%

Deductible, then 20%

Outpatient Surgery

Deductible, then 0%

Deductible, then 20%

Emergency Room

Deductible, then 0%

Paid as In-network

Urgent Care

Deductible, then 0%

Deductible, then 20%

Deductible Coinsurance

Preventive Care Services Complex Imaging Services (CT Scans, PET Scans & MRI’s)

Prescription Drugs

You pay either a copay &/or coinsurance per the assigned prescription drug tier which can be found in the prescription drug formulary.

Medical deductible applies Quantity Limits: Retail = 30-day supply; Mail-Order = 90-day supply

Tier 1 — Generic Drugs

Deductible, then 0%

Tier 2 — Preferred Brand-Name

Deductible, then 0%

Tier 3 — Non-Preferred Brand-Name

Deductible, then 0%

Tier 4 - Specialty Drugs

Deductible, then 0%

Mail-Order 90-day supply

Deductible, then 0%

If you enroll in this High Deductible Plan, AIC will contribute $750 into your HSA Account. That money is yours to keep, even if you leave AIC. You can use your HSA to help pay for your medical expenses. You can also arrange to have payroll deductions in any amount also put into your account—pre-tax! See page 7 for more details.

The prescription drug coverage provided by the $3,500 HSA deductible Point of Service medical plan is not expected to pay out as much as standard Medicare prescription drug coverage pays. This is important because members who enroll in a Medicare prescription drug plan after their initial eligibility period, may pay a higher premium (a penalty) if they were enrolled in a group health plan with non-creditable prescription drug coverage.

!

Applied Industrial Controls Benefit Guide | 6

HEALTH SAVINGS ACCOUNT (HSA) The Health Savings Account (HSA) is a tax-advantaged, interest-bearing account used to pay for eligible health care expenses. You can open and contribute to an HSA with HSA Bank if you are enrolled in the Cigna High Deductible HSA $3,500 Plan. Additionally, you are not required to take distributions. Your money can continue to grow in your account until you need it. Unlike flexible spending accounts which work on a “use it or lose it” principle, HSAs are use it or keep it! You maintain complete control over how and when to make payments for qualified medical expenses from your account. You can make contributions to the HSA and all money in the account is yours to keep — even if you leave Applied Industrial Controls. You can withdraw your funds to pay for current qualified medical, dental and vision care expenses, or you can keep your money in the HSA to pay for future expenses. At the end of the year, any money in the HSA rolls over to the next year. You never lose it.

Applied Industrial Controls will contribute $750/year for each employee’s HSA account.

IRS Maximum (Employee & AIC combined) Coverage Level Calendar Year 2022

Calendar Year 2023

Employee Only

$3,650

$3,850

Employee + Spouse, Employee + Children, Employee + Family

$7,300

$7,750

If age 55 or older

Additional $1,000 contribution permitted

Additional $1,000 contribution permitted

Applied Industrial Controls Benefit Guide | 7

DENTAL – Employer Paid Applied Industrial Controls provides all full-time employees the option to enroll in a DPPO dental plan with Cigna at no cost to you. You may choose any dentist for services. However, if you choose one of Cigna’s In-Network Dentists, you could save money. To find a Preferred Dentist, visit www.Cigna.com and click on Find a Dentist. Out-of-network benefits mirror in-network benefits however, the out-of-network provider may balance bill the member for services.

In-Network (Plan Pays)

In-Network (Plan Pays)

$50 individual/ $150 family

$50 individual/ $150 family

$1,000 combined Innetwork and Out-ofNetwork

$1,000 combined Innetwork and Out-ofNetwork

100% (Deductible waived)

100% (Deductible waived)

80% After deductible

80% After deductible

50% After deductible

50% After deductible

Orthodontics (Children to age 19)

50%

50%

Lifetime Orthodontia Maximum

$1,000

$1,000

Dental Plan Highlights Your Deductible Calendar Year Maximum Applies to preventive, basic, and major services

Preventive & Diagnostic Services Exams, Cleanings & Bitewing X-Rays, Fluoride

Basic Services Sealants, Filings, Extractions, Endodontics (root canal), Periodontics (gum surgery), Oral Surgery, Emergency care to relieve pain

Major Services Crowns, Bridgework, Full & Partial Dentures, Repairs to bridges, crowns, and inlays, Relines, Rebases, and Adjustments

Applied Industrial Controls Benefit Guide | 8

VOLUNTARY VISION Applied Industrial Controls gives you the option to enroll in vision coverage through Guardian Vision with the VSP Choice Network. The basic plan information is listed below. A more detailed plan summary can be requested from AIC’s HR department.

If you need help finding an In-Network provider, please visit www.guardiananytime.com for a complete list of locations near you.

In Network

Out of Network Reimbursement

$10 Copay

$39 max

$80 retail max $150 retail max + 20% off balance

Not covered $46 max

Single

$25 Copay

$23 max

Bifocal

$25 Copay

$37 max

Trifocal

$25 Copay

$49 max

Services Eye Exam: Routine Exam with Dilation Frames: Costco, Walmart, Sam’s Club All Other Retail Locations Standard Plastic Lenses:

Contact Lenses: (Material Only) and in lieu of eyeglass lenses and/or frames Elective contacts

$150 max (copay waived)

$100 max (copay waived)

Covered after copay

$210 max

Examination

Once every 12 months

Once every 12 months

Frames

Once every 24 months

Once every 24 months

Eyeglass Lenses

Once every 12 months

Once every 12 months

Contact Lenses

Once every 12 months

Once every 12 months

Medically Necessary Frequency:

Applied Industrial Controls Benefit Guide | 9

BASIC LIFE AND AD&D Life/AD&D Insurance is a key element of proper financial planning and helps provide financial stability and protection for families in case of an untimely death. If you are an eligible full-time employee, Applied Industrial Controls provides Basic Life insurance at no cost to you through Guardian. The benefit is $50,000. Accidental Death & Dismemberment (AD&D) provides additional protection in the event of accidental death. It also covers loss of limb or eye due to accident.

VOLUNTARY LIFE/AD&D You may purchase additional insurance through Guardian. This coverage is portable; you may take it with you when leave Applied Industrial Controls within 30 days by contacting Guardian.

Guaranteed Issue Schedule when first eligible for AIC benefits • • •

Employee: $100,000 Spouse: $25,000 Child: All coverage is guarantee issue

The guarantee issue amount for when you are first offered AIC benefits (usually means when you were first hired by AIC) is $100,000 (under age 65).

The guarantee issue amount means that no health statement (aka EOI) is required for newly hired employees who are first being offered AIC benefits and seeking up to $100,000 in coverage; however, if you’ve been employed by AIC for years and just now deciding to purchase Voluntary Life/AD&D insurance, you will have to complete a statement of health (EOI) before you are approved for this coverage, even amounts below $100,000). Employees can purchase increments of $25,000 up to a maximum of $200,000.

Employees wishing to apply for coverage above $100,000 at any time during employment with AIC or after that time first eligible, will need to seek approval for this coverage by completing a statement of health (EOI) form, where they will answer a series of simple health questions for Guardian underwriting to review. Visit www.guardiananytime.com/eoi to complete the EOI online.

If electing coverage for yourself, you may also elect coverage for your spouse and/or children.

Spouse: Select $10,000, $20,000 or $25,000 (not to exceed 100% of employee’s coverage). The guarantee issue amount is $25,000 (under age 65). Child: $10,000 (not to exceed 100% of employee’s coverage) up to age 26.

Voluntary Life benefit amounts will reduce to 65% of the original amount at age 65, to 50% at age 70, to 35% at age 75, to 20% at age 80. Benefits terminate at retirement. The spouse's Voluntary Life benefit amount will reduce in accordance with the spouse’s age.

Applied Industrial Controls Benefit Guide | 10

DISABILITY INSURANCE Long-Term Disability (Employer Paid) Long-Term Disability (LTD), through Guardian is paid for by Applied Industrial Contols, and offers income protection if you become disabled and cannot work for an extended period of time. The LTD benefit begins after 90 Days and pays 60% of your monthly salary to a maximum of $10,000 per month.

Benefits are paid as long as you remain disabled, in general until you reach age 65 or the Social Security Normal Retirement Age. There is a pre-existing condition provision where a condition for which you were treated in the 3 months prior to coverage will not be covered in the first 12 months of coverage.

Short-Term Disability (Voluntary – Employee Paid) Even a few weeks away from work can make it difficult to manage household expenses. Voluntary Short-Term Disability is offered through Guardian. This coverage will pay up to 60% of your weekly salary up to a maximum of $1,000 for non- work-related accidents or sickness, so you can focus on getting better, and worry less about keeping up with your bills. Benefits begin on the 1st day of an accident and the 8th day of a sickness. (For nonaccidents, benefits start after a 7-day waiting period for which you will not receive payment. Subtract one week from the total weeks you will receive payment. For example, standard pregnancy delivery is 6 weeks with a benefit payment of 5 weeks.) Benefits are payable up to a maximum of 12 weeks depending on the disability.

This plan does have a Pre-Existing Condition exclusion that looks back 3 months before you sign up and ahead 12 months after you sign up. This includes any condition/symptom in which you, in the specified time period prior to coverage in this plan, consulted with a physician, received treatment or took prescribed drugs.

Applied Industrial Controls Benefit Guide | 11

ACCIDENT INSURANCE You have the option to purchase Accident Insurance with Allstate. Benefits are paid directly to you based on a flat schedule when an accident occurs off the job.

Some examples of covered accidents include: fracture, dislocation, burn, concussion, coma, torn cartilage in knee, laceration, broken tooth, eye injury, ambulance, hospital admission, paralysis, dismemberment, etc.

Allstate pays a wellness reimbursement of $50 per covered member per year for providing proof of preventive screening tests rendered.

You can elect coverage for your spouse and children. The policy is portable. You can take it with you at the same rate by notifying Allstate within 30 days of termination and requesting direct bill.

CRITICAL ILLNESS INSURANCE You have the option to purchase Critical Illness Insurance with Allstate. The Critical Illness policy provides a financial cushion if you are diagnosed with a critical illness or cancer.

Employees have the option to choose a lump sum benefit of $10,000 or $20,000, and you may also elect coverage for your dependents. Spouses are eligible for up 50% of the employee’s benefit amount.

This benefit has a pre-existing condition limitation of a 12-month look back and 12-month exclusion, as well as a 30-day waiting period from the time coverage is effective.

Allstate pays a wellness reimbursement of $50 per covered member per year for providing proof of preventive screening tests rendered.

The policy is portable. You can take it with you at the same rate by notifying Allstate within 30 days of termination and requesting direct bill.

Applied Industrial Controls Benefit Guide | 12

Protection for accidental injuries on- and off-the-job, 24 hours a day

Accident Insurance

DID YOU

Today, active lifestyles in or out of the home may result in bumps, bruises and sometimes breaks. Getting the right treatment can be vital to recovery, but it can also be expensive. And if an accident keeps you away from work during recovery, the financial worries can grow quickly.

Most major medical insuranceplansonly payaportion of the bills.Our coverage can help pickupwhereother insuranceleaves off andprovidecash to help cover the expenses.

With Accident insurance from Allstate Benefits, you can gain the advantage of financial support, thanks to the cash benefits paid directly to you. You also gain the financial empowerment to seek the treatment needed to be on themend.

Here’s How It Works Our coverage pays you cash benefits that correspond with hospital and intensive care confinement. Your plan may also include coverage for a variety of occurrences, such as: dismemberment; dislocation or fracture; ambulance services; physical therapy and more. The cash benefits can be used to help pay for deductibles, treatment, rent andmore.

Meeting Your Needs

KNOW

?

The number of injuries suffered by workers in one year, both on- and off-the-job, includes:1 ON-THE-JOB (in millions) Work

4.4 OFF-THE-JOB (in millions) Home

25.0 Non-A uto

12.6 Auto

4.3

• Guaranteed Issue coverage, subject to exclusions andlimitations* • Benefits are paid directly to you unless otherwise assigned • Pays in addition to other insurancecoverage

Offered to the employees of:

• Coverage also available for yourdependents

Applied Industrial Controls

• Premiums are affordable and can be conveniently payrolldeducted • Coverage may be continued; refer to your certificate fordetails With Allstate Benefits, you can protect your finances against life’s slips and falls.

Practical benefits for everyday living.® *Please refer to the Exclusions and Limitations section of this brochure. 1National Safety Council, Injury Facts®,2019 Edition

GVAP6BGA HSA

Applied Industrial Controls Benefit Guide | 13

POD100220

Group Voluntar y Accident 24-Hour Accident Insurance from Allstate Benefits

O f f er ed to the e m p loy e e s of:

BENEFIT AMOUNTS

Applied Industrial Controls

Benefits are paid once per accident unless otherwise noted here or in the brochure

BASE POLICY BENEFIT

PLAN 1

Initial Hospital Confinement (pays once/year) Daily Hospital Confinement (pays daily) Intensive Care (pays daily)

RIDER BENEFITS

$1,000 $200 $400

PLAN 1

Accident Treatment & Urgent CareRider Ground Ambulance Air

Accident Physician’s Treatment X-ray Urgent Care Dislocation/Fracture Rider1 Emergency Room Services Rider Outpatient Physician’s Treatment for Accident and Preventive Care Benefit Rider (OPH) (pays daily) Accidental Death*, Dismemberment 1,* and Functional Loss1,* Rider Common Carrier (fare-paying passenger)

BENEFIT ENHANCEMENT RIDER Accident Follow-Up Treatment (pays daily) Lacerations < 15% body Burns surface

PLAN 1 PRE MIUMS

PLAN 2 $1,500 $300 $600

PLAN 2

$200 $600 $100 $200 $100 $4,000 $200

$300 $900 $150 $300 $150 $6,000 $300

$50

$50

$40,000 $100,000

$60,000 $150,000

PLAN 1 $100 $100 $200 $1,000

Paralysis (pays once)

Paraplegia Quadriplegia

Open Abdominal or Thoracic Surgery Tendon, Ligament, Rotator Cuff or Knee Cartilage Surgery Ruptured Spinal Disc Surgery Eye Surgery General Anesthesia Blood and Plasma Appliance Medical Supplies Medicine Prosthesis

Surgery Exploratory

1device 2 or more devices

Physical, Occupational or Speech Therapy (pays daily) Rehabilitation Unit (pays daily) Non-Local Transportation Family Member Lodging (pays daily) Post-Accident Transportation (pays once/year) Broken Tooth Residence/Vehicle Modification

Pain Management (Epidural Injection) Miscellaneous Outpatient Surgery

EE

EE + SP

EE + CH

FAM

Monthly

$15.03

$25.98

$31.91

$41.90

Bi-Weekly

$6.94

$11.99

$14.73

$19.34

PLAN 2 PRE MIUMS MODE

EE

EE + SP

EE + CH

FAM

Monthly

$21.03

$36.36

$44.94

$58.31

Bi-Weekly

$9.71

$16.78

$29.74

$26.91

PLAN 2 $150 $150 $300 $1,500

15% or more

Skin Graft (% ofBurns Benefit) Brain Injury Diagnosis Computed Tomography (CT) Scanand Magnetic Resonance Imaging (MRI) (pays once/year)

MODE

50% $600

50% $900

$100 $15,000 $30,000

$150 $22,500 $45,000

$2,000 $1,000 $300

$3,000 $1,500 $450

$1,000 $200 $200 $600 $250 $10.00 $10.00 $1,000 $2,000

$1,500 $300 $300 $900 $375 $15.00 $15.00 $1,500 $3,000

$60 $200 $500 $200 $400 $200 $1,000 $100 $200

$90 $300 $750 $300 $600 $300 $1,500 $150 $300

Injury Benefit Schedule COMPLETE DISLOCATION

PLAN 1

PLAN 2



$4,000 $1,600

$6,000 $2,400

Bone or bones of the hand, collarbone Two or more fingers or toes One finger or toe

$1,400 $1,200 $800 $600 $280 $120

$2,100 $1,800 $1,200 $900 $420 $180

Hip joint Knee or ankle joint , bone or bones of the foot  Wrist joint Elbow joint Shoulder joint

C O M P L E T E , SIMPLE O R C L O S E D F R A C T U RE Hip, thigh (femur), pelvis Skull  Arm, between shoulder and elbow (shaft), shoulder blade (scapula), leg (tibia or fibula) Ankle, knee cap (patella), forearm (radius or ulna), collarbone (clavicle) Foot , hand or wrist   Lower jaw Two or more ribs, fingers or toes, bones of face or nose One rib, finger or toe, coccyx

LOSS

PLAN 1

$6,000

$3,800

$5,700

$2,200

$3,300

$1,600

$2,400

$1,400 $800 $600

$2,100 $1,200 $900

$280

PLAN 1

Life, hearing, speech, or both eyes, hands, arms, feet, or legs, or one hand or arm and one foot or leg One eye, hand, arm, foot, or leg One or more entire toes or fingers

PLAN 2

$4,000

$420

PLAN 2

$40,000

$60,000

$20,000 $4,000

$30,000 $6,000

Applied Industrial Controls Benefit Guide | 14

Protection when faced with a critical illness diagnosis and you need treatment

Applied Industrial Controls Benefit Guide | 15

Applied Industrial Controls Benefit Guide | 16

CONTRIBUTIONS Applied Industrial Controls generously contributes 80% of the cost of medical coverage for all eligible employees and their dependents. AIC also fully pays for Dental, Basic Life, and Long-term Disability. You do have the option to Voluntarily enroll in Vision, Voluntary Life, Accident, Critical Illness and Short-term Disability. All insurance options will be available through the EASE enrollment application. Even if you are waiving coverage, please select the “waive” option in Ease. Please refer to the chart below for your biweekly payroll deductions.

Bi-Weekly Payroll Deductions Plans

Employee Only

Employee & Spouse

Employee & Child(ren)

Family

Medical Option Plan 1 BASE $3,500 Deductible OAP Employee Contributions

$72.42

$197.36

$184.68

$282.91

Medical Option Plan 2 BUY-UP $3,000 Deductible OAP Employee Contributions

$76.73

$209.09

$195.66

$299.72

Medical Option Plan 3 HSA $3500 Deductible HD Plan Employee Contributions

$59.94

$163.34

$152.85

$234.15

Dental Employee Contributions

$0.00

$0.00

$0.00

$0.00

Dental Employer Contributions

$13.41

$28.15

$32.00

$50.19

Vision Employee Contributions

$3.22

$5.41

$5.52

$8.74

Vision Employer Contributions

$0.00

$0.00

$0.00

$0.00

Applied Industrial Controls Benefit Guide | 17

Applied Industrial Controls Benefit Guide | 18

KEY CONTACTS & RESOURCES Your Broker Support Contacts

JANE MURPHY SSP SR ACCOUNT ANALYST 404-949-1076 jane.murphy@sspins.com EMBER FORD SSP SR CLIENT SERVICES EXECUTIVE 404-949-1022 eford@sspins.com

KEY CONTACTS & RESOURCES Benefit

Company

Phone

Website

Medical Coverage

Cigna

866-494-2111

www.myCigna.com

Health Savings Account (HSA)

Cigna/ HSA Bank

866-494-2111

www.myCigna.com

Dental

Cigna

866-494-2111

www.myCigna.com

Guardian Vision

Guardian/VSP

888-482-7342

www.guardiananytime.com

Basic Life/AD&D & Long-Term Disability

Guardian

Contact HR

www.guardiananytime.com

Short-Term Disability & Voluntary Life

Guardian

888-482-7342

www.guardiananytime.com

Accident & Critical Illness

Allstate

877-810-2920

www.allstate.com

Applied Industrial Controls Benefit Guide | 19

IMPORTANT INFORMATION COBRA Continuation of Coverage The right to COBRA continuation coverage was created by a federal law, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). COBRA continuation coverage can become available to you and other members of your family when group health coverage would otherwise end. For more information about your rights and obligations under the Plan and under federal law, you should review the Plan’s Summary Plan Description or contact the Plan Administrator. For additional information regarding COBRA qualifying events, how coverage is provided and actions required to participate in COBRA coverage, please see your Human Resources department.

Newborns’ and Mothers’ Health Protection Act The group health coverage provided complies with the Newborns’ and Mothers’ Health Protection Act of 1996. Under this law group health plans and health insurance issuers generally may not, under federal law, restrict benefits for any hospital length of stay in connection with childbirth for the mother or newborn 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 from the plan or the insurance issuer for prescribing a length of stay not in excess of 48 hours (or 96 hours).

Premium Assistance under Medical and CHIP If you or your children are eligible for Medicaid or CHIP (Children’s Health Insurance Program) and you are eligible for health coverage from your employer, your State may have a premium assistance program that can help you pay for coverage. These States use funds from their Medicaid or CHIP programs to help people who are eligible for employersponsored health coverage but need assistance in paying their health premiums. If you or your dependents are already enrolled in Medicaid or CHIP you can contact your State Medicaid or CHIP office to find out if premium assistance is available. If you or your dependents are NOT currently enrolled in Medicaid or CHIP, and you think you or any of your dependents might be eligible for either of these programs, you can contact your State Medicaid or CHIP office or dial 1877-KIDS NOW or www.insurekidsnow.gov to find out how to apply. If you qualify, you can ask the State if it has a program that might help you pay the premiums for an employer-sponsored plan. Please see Human Resources for a list of state Medicaid or CHIP offices to find out more about premium assistance.

Special Enrollment Events An Eligible Person and/or Dependent may also be able to enroll during a special enrollment period. A special enrollment period is not available to an Eligible Person and his or her dependents if coverage under the prior plan was terminated for cause, or because premiums were not paid on a timely basis.

An Eligible Person and/or Dependent does not need to elect COBRA continuation coverage to preserve special enrollment rights. Special enrollment is available to an Eligible Person and/or Dependent even if COBRA is elected.

Please be aware that most special enrollment events require action within 30 days of the event. Please see Human Resources for a list of special enrollment opportunities and procedures.

Women’s Health and Cancer Rights Act If you have had or are going to have a mastectomy , you may be entitled to certain benefits under the Women’s Health and Cancer Rights Act of 1998 (WHCRA). For individuals receiving mastectomy-related benefits, coverage will be provided in a manner determined in consultation with the attending physician and the patient, for: All stages of reconstruction of the breast on which the mastectomy has been performed; Surgery and reconstruction of the other breast to produce a symmetrical appearance; and Prostheses and treatment of physical complications of the mastectomy, including lymphedemas. These benefits will be provided subject to deductibles and coinsurance applicable to other medical and surgical benefits provided under this plan. If you would like more information on WHCRA benefits, call your plan administrator.

Applied Industrial Controls Benefit Guide | 20

IMPORTANT INFORMATION GINA The Genetic Information Nondiscrimination Act (GINA) prohibits health benefit plans from discriminating on the basis of genetic information in regards to eligibility, premium and contributions. This generally also means that private employers with more than 15 employees, its health plan or “business associate” of the employer, cannot collect or use genetic information, (including family medical history information). The once exception would be that a minimum amount of genetic testing results make be used to make a determination regarding a claim.

You should know that GINA is treated as protected health information (PHI) under HIPAA. The plan must provide that an employer cannot request or require that you reveal whether or not you have had genetic testing; nor can your employer require that you participate in a genetic test. An employer cannot use any genetic information to set contribution rates or premiums.

PPACA Compliant Plan Notice Since key parts of the health care law took effect in 2014, there is a new way to buy health insurance: the Health Insurance Marketplace. To assist you as you evaluate options for you and your family, this notice provides some basic information about the new Marketplace and employment based health coverage offered by your employer.

If your employer offers health coverage that meets the “minimum value” plan standard, you will not be eligible for a tax credit through the Marketplace and may wish to enroll in your employer’s health plan. The “minimum value” plan standard is set by the Affordable Care Act. Your health plans offered by [Company] are ACA compliant plans (surpassing the “minimum value” standard), thus you would not be eligible for the tax credit offered to those who do not have access to such a plan.

NOTE: If you purchase a health plan through the marketplace instead of accepting health coverage offered by your employer, then you will lose the employer contribution to the employer offered coverage. Also, this employer contribution, as well as your employee contribution to employer offered coverage, is excluded from income for Federal and State income tax purposes.

USERRA Notice The Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) established requirements that employers must meet for certain employees who are involved in the uniformed services. In addition to the rights that you have under COBRA, you (the employee) are entitled under USERRA lo continue the coverage that you (and your covered dependents, if any) had under the [Company] plan.

You Have Rights Under Both COBRA and USERRA. Your rights under COBRA and USERRA are similar but not identical. Any election that you make pursuant to COBRA will also be an election under USERRA, and COBRA and USERRA will both apply with respect to the continuation coverage elected. If COBRA and USERRA give you different rights or protections, the law that provides the greater benefit will apply. The administrative policies and procedures described in the attached COBRA Election Notice also apply to USERRA coverage, unless compliance with the procedures is precluded by military necessity or is otherwise impossible or unreasonable under the circumstances.

Definitions "Uniformed services" means the Armed Forces, the Army National Guard, and the Air National Guard when an individual is engaged in active duty for training, inactive duty training, or full-time National Guard duty (i.e., pursuant to orders issued under federal law), the commissioned corps of the Public Health Service, and any other category of persons designated by the President in time of war or national emergency.

"Service in the uniformed services" or "service" means the performance of duty on a voluntary or involuntary basis in the uniformed services under competent authority, including active duty, active and inactive duty for training, National Guard duty under federal statute, a period for which a person is absent from employment for an examination to determine his or her fitness to perform any of these duties, and a period for which a person is absent from employment to perform certain funeral honors duty. It also includes certain service by intermittent disaster response appointees of the National Disaster Medical System.

Applied Industrial Controls Benefit Guide | 21

IMPORTANT INFORMATION Duration of USERRA Coverage General Rule: 24-Month Maximum. When a covered employee takes a leave for service in the uniformed services, USERRA coverage for the employee (and covered dependents for whom coverage is elected) can continue until up to 24 months from the date on which the employee's leave for uniformed service began. However, USERRA coverage will end earlier if one of the following events takes place: A premium payment is not made within the required time; You fail to return to work or to apply for reemployment within the time required under USERRA (see below) following the completion of your service in the uniformed services; You lose your rights under USERRA as a result of a dishonorable discharge or other conduct specified in USERRA. Notice of Privacy Provision This Notice of Privacy Practices (the "Notice") describes the legal obligations of [Company] (the "Plan") and your legal rights regarding your protected health information held by the Plan under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Health Information Technology for Economic and Clinical Health Act (HITECH Act). Among other things, this Notice describes how your protected health information may be used or disclosed to carry out treatment, payment, or health care operations, or for any other purposes that are permitted or required by law. We are required to provide this Notice of Privacy Practices to you pursuant to HIPAA. The HIPAA Privacy Rule protects only certain medical information known as "protected health information." Generally, protected health information is health information, including demographic information, collected from you or created or received by a health care provider, a health care clearinghouse, a health plan, or your employer on behalf of a group health plan, from which it is possible to individually identify you and that relates to: • Your past, present, or future physical or mental health or condition; • The provision of health care to you; or • The past, present, or future payment for the provision of health care to you.

If you have any questions about this Notice or about our privacy practices, please contact your Human Resources department. The full privacy notice is available with your Human Resources Department.

Applied Industrial Controls Benefit Guide | 22

IMPORTANT INFORMATION This guide provides a summary of you employee benefits rights and regulations as determined by Federal and State Laws. Information included in this guide includes the following: Special Open Enrollment Rights Children’s Health Insurance Assistance

Program

(CHIP)

Premium

General Notice of the Cobra Continuations Rights Affordable Care Act (ACA) – Insurance Mandate

Health Insurance Marketplace Coverage Options and Your Group Health Coverage Affordable Care Act (ACA) – Preventive Services for Non-grandfathered Plans Newborns’ and Mothers’ Health Protection Act of 1996 Break Time for Nursing Mothers Under the Fair Labor Standards Acts (FLSA) Women’s Health & Cancer Rights Act The Generic Information Nondiscrimination Act of 2008 (GINA) HIPAA Privacy Rules

SPECIAL OPEN ENROLLMENT RIGHTS This notice is being provided to ensure that you understand your right to apply for group health insurance coverage. A special enrollment period is a time outside of the annual open enrollment period during which you and your family have a right to sign up for health coverage. In the Marketplace, you qualify for a special enrollment period 60 days following certain life events that involve a change in family status (for example, marriage or birth of a child) or loss of other health coverage. Job-based plans must provide a special enrollment period of 30 days. Some events will require additional documentation to be submitted with the application at the time of enrollment. You should read this notice even if you plan to waive coverage at this time.

Marriage, Birth, or Adoption

Loss of Other Coverage

Medicaid or CHIP

If you have a new dependent as a result of a marriage, birth, adoption, or placement for adoption, you may be able to enroll yourself and your dependents. However, you must request enrollment within 30 days after the marriage, birth, or placement for adoption.

If you are declining coverage for yourself or your dependents (including your spouse) because of other health insurance or group health plan coverage, you may be able to enroll yourself and your dependents in this plan if you or your dependents lose eligibility for that other coverage (or if the employer stops contributing toward your or your dependents’ other coverage). However, you must request enrollment within 30 days after your or your dependents’ other coverage ends (or after the employer stops contributing toward the other coverage).

If you or your dependents lose eligibility for coverage under Medicaid or the Children’s Health Insurance Program (CHIP) or become eligible for a premium assistance subsidy under Medicaid or CHIP, you may be able to enroll yourself and your dependents. You must request enrollment within 60 days of the loss of Medicaid or CHIP coverage or the determination of eligibility for a premium assistance subsidy.

To request special enrollment or obtain more information, please contact HR. Applied Industrial Controls Benefit Guide | 23

HEALTH INSURANCE MARKETPLACE PART A: GENERAL INFORMATION To assist you as you evaluate options for you and your family, this notice provides some basic information about the Marketplace and employment-based health coverage offered by your employer.

What is the Health Insurance Marketplace?

The Marketplace is designed to help you find health insurance that meets your needs and fits your budget.

The Marketplace offers “one-stop shopping” to find and compare private health insurance options. You may also be eligible for a new kind of tax credit that lowers your monthly premium right away. Open enrollment for health insurance coverage through the Marketplace runs from November 1, 2022 through December 15, 2022 for coverage starting as early as January 1, 2023.

Can I Save Money on my Health Insurance Premiums in the Marketplace?

You may quality to save money and lower your monthly premium, but only if our employer does not offer coverage, or offers coverage that doesn’t meet certain standards. The savings on your premium that you’re eligible for depends on your household income.

Does Employer Health Coverage Affect Eligibility for Premium Savings Through the Marketplace?

Yes. If you have an offer of health coverage from your employer that meets certain standards, you will not be eligible for a tax credit through the Marketplace and may wish to enroll in your employer’s health plan. However, you may be eligible for a tax credit that lowers your monthly premium, or a reduction in certain cost-sharing if your employer does not offer coverage to you at all or does not offer coverage that meets certain standards. If the cost of a plan from your employer that would cover you (and not any other members of your family) is more than 9.5% of your household income for the year, or if the coverage your employer provides does not meet the “minimum value” standard set by the Affordable Care Act, you may be eligible for a tax credit.

!

If you purchase a health plan through the Marketplace instead of accepting health coverage by your employer, then you may lose the employer contribution (if any) to the employer-offered coverage. Also, this employer contribution – as well as your employee contribution to employer-offered coverage – is often excluded from income for Federal and State income tax purposes. Your payments for coverage through the Marketplace are made on an alter-tax basis.

How Can I Get More Information?

For more information about your coverage offered by your employer, please check your summary plan description or contact Human Resources.

The Marketplace can help you evaluate your coverage options, including your eligibility for coverage through the Marketplace and its cost. Please visit www.healthcare.gov for more information, including an online application for health insurance coverage and contact information for a Health Insurance Marketplace in your area.

Applied Industrial Controls Benefit Guide | 24

HEALTH INSURANCE MARKETPLACE PART B: INFORMATION ABOUT HEALTH COVERAGE OFFERED BY YOUR EMPLOYER This section contains information about any health coverage offered by your employer. If you decide to complete an application for coverage in the Marketplace, you will be asked to provide this information. This information is numbered to correspond to the Marketplace application.

1. Employee Name Applied Industrial Controls

2. Employee Identification Number (EIN) 58-2251715

3. Employer Address 1860 South Lee Court

4. Employer Phone Number 770-614-7022

5. City Buford

6. State GA

7. Zip Code 30515

8. Who can we contact about health coverage at this job?

Wendy Lisiakowski 9. Phone Number (if different from above)

10. Email Address wendy@aic-controls.com

Here is some basic information about health coverage offered by this employer: As your employer, we offer a health plan to: All employees. Eligible employees are: Active full-time employees working 30 or more hours a week.

Some employees. Eligible employees are:

With respect to dependents: We do offer coverage. Eligible dependents are: Spouses and children up to age 26.

We do not offer coverage.

If checked, this coverage meets the minimum value standard and the cost of this coverage to you is intended to be affordable, based on employee wages. ** Even if your employer intends your coverage to be affordable, you may still be eligible for a premium discount through Marketplace. The Marketplace will use your household income, along with other factors, to determine whether you may be eligible for a premium discount. If for example, your wages vary from week to week (perhaps you are an hourly employee or you work on a commission basis), if you are newly employed mid-year, or if you have other income losses, you may still qualify for a premium discount.

If you decide to shop for coverage in the Marketplace, Healthcare.gov will guide you through the process. Here’s the employer information you’ll enter when you visit to find out if you can get a tax credit to lower your monthly premiums.

Applied Industrial Controls Benefit Guide | 25

IMPORTANT NOTICE ABOUT YOUR PRESCRIPTION DRUG COVERAGE & MEDICARE CREDITABLE Please read this notice carefully and keep it where you can find it. This notice has information about your current prescription drug coverage with Applied Industrial Controls and about your options under Medicare’s prescription drug coverage. This information can help you decide whether or not you want to join a Medicare drug plan. If you are considering joining, you should compare your current coverage, including which drugs are covered at what cost, with the coverage and costs of the plans offering Medicare prescription drug coverage in your area. Information about where you can get help to make decisions about your prescription drug coverage is at the end of this notice.

There are two important things you need to know about your current coverage and Medicare’s prescription drug coverage: •

Medicare prescription drug coverage became available in 2006 to everyone with Medicare. You can get this coverage if you join a Medicare Prescription Drug Plan or join a Medicare Advantage Plan (like an HMO or PPO) that offers prescription drug coverage. All Medicare drug plans provide at least a standard level of coverage set by Medicare. Some plans may also offer more coverage for a higher monthly premium.

•

Applied Industrial Control has determined that the prescription drug coverage offered by the Cigna Base and Buy-Up plans are, on average for all plan participants, expected to pay out as much as standard Medicare prescription drug coverage pays and is therefore considered Creditable Coverage. Because your existing coverage is Creditable Coverage, you can keep this coverage and not pay a higher premium (a penalty) if you later decide to join a Medicare drug plan.

When Can You Join a Medicare Drug Plan?

You can join a Medicare drug plan when you first become eligible for Medicare and each year from October 15th to December 7th. However, if you lose your current creditable prescription drug coverage, through no fault of your own, you will also be eligible for a two (2) month Special Enrollment Period (SEP) to join a Medicare drug plan.

What Happens To Your Current Coverage If You Decide to Join A Medicare Drug Plan?

If you decide to join a Medicare drug plan, your current Applied Industrial Controls cover- age will not be affected.

Please review prescription drug coverage plan provisions/options under the certificate booklet provided by Cigna. See pages 7- 9 of the CMS Disclosure of Creditable Coverage To Medicare Part D Eligible Individuals Guidance which outlines the prescription drug plan provisions/ options that Medicare eligible individuals may have available to them when they become eligible for Medicare Part D. If you do decide to join a Medicare drug plan and drop your current Applied Industrial Controls coverage, be aware that you and your dependents may not be able to get this coverage back.

When Will You Pay A Higher Premium (Penalty) To Join A Medicare Drug Plan?

You should also know that if you drop or lose your current coverage with Applied Industrial Controls and don’t join a Medicare drug plan within 63 continuous days after your current coverage ends, you may pay a higher premium (a penalty) to join a Medicare drug plan later. If you go 63 continuous days or longer without creditable prescription drug coverage, your monthly premium may go up by at least 1% of the Medicare base beneficiary premium per month for every month that you did not have that coverage. For example, if you go nineteen months without creditable coverage, your premium may consistently be at least 19% higher than the Medicare base beneficiary premium. You may have to pay this higher premium (a penalty) as long as you have Medicare prescription drug coverage. In addition, you may have to wait until the following October to join.

For more information about this notice or your current prescription drug coverage, contact your carrier.

NOTE: You’ll get this notice each year. You will also get it before the next period you can join a Medicare drug plan, and if this coverage through Applied Industrial Controls changes. You also may request a copy of this notice at any time.

More detailed information about Medicare plans that offer prescription drug coverage is in the “Medicare & You” handbook.

You’ll get a copy of the handbook in the mail every year from Medicare. You may also be contacted directly by Medicare drug plans. For more information about Medicare prescription drug coverage Visit www.medicare.gov. Call your State Health Insurance Assistance Program (see the inside back cover of your copy of the “Medicare & You” handbook for their telephone number) for personalized help Call 1-800-MEDICARE (1-800633-4227). TTY users should call 1-877-486- 2048. If you have limited income and resources, extra help paying for Medicare prescription drug coverage is available. For information about this extra help, visit Social Security on the web at www.socialsecurity.gov, or call them at 1-800-772-1213 (TTY 1800-325-0778).

Remember: Keep this Creditable Coverage notice. If you decide to join one of the Medicare drug plans, you may be required to provide a copy of this notice when you join to show whether or not you have maintained creditable coverage and, therefore, whether or not you are required to pay a higher premium (a penalty).

Applied Industrial Controls Benefit Guide | 26

IMPORTANT NOTICE ABOUT YOUR PRESCRIPTION DRUG COVERAGE & MEDICARE NON-CREDITABLE Please read this notice carefully and keep it where you can find it. This notice has information about your current prescription drug coverage with Applied Industrial Controls and about your options under Medicare’s prescription drug coverage. This information can help you decide whether or not you want to join a Medicare drug plan. If you are considering joining, you should compare your current coverage, including which drugs are covered at what cost, with the coverage and costs of the plans offering Medicare prescription drug coverage in your area. Information about where you can get help to make decisions about your prescription drug coverage is at the end of this notice.

There are two important things you need to know about your current coverage and Medicare’s prescription drug coverage: •

•

•

Medicare prescription drug coverage became available in 2006 to everyone with Medicare. You can get this coverage if you join a Medicare Prescription Drug Plan or join a Medicare Advantage Plan (like an HMO or PPO) that offers prescription drug coverage. All Medicare drug plans provide at least a standard level of coverage set by Medicare. Some plans may also offer more coverage for a higher monthly premium.

Applied Industrial Controls has determined that the prescription drug coverage offered by the Cigna HSA $3500 deductible, on average for all plan participants, NOT expected to pay out as much as standard Medicare prescription drug coverage pays. Therefore, your coverage is considered Non-Creditable Coverage. This is important because, most likely, you will get more help with your drug costs if you join a Medicare drug plan, than if you only have prescription drug coverage from the Cigna High Deductible HSA Plan. This also is important because it may mean that you may pay a higher premium (a penalty) if you do not join a Medicare drug plan when you first become eligible.

You can keep your current coverage from the Cigna HSA plan. However, because your coverage is non-creditable, you have decisions to make about Medicare prescription drug coverage that may affect how much you pay for that coverage, depending on if and when you join a drug plan.

When you make your decision, you should compare your current coverage, including what drugs are covered, with the coverage and cost of the plans offering Medicare prescription drug coverage in your area. Read this notice carefully it explains your options.

When Can You Join a Medicare Drug Plan?

You can join a Medicare drug plan when you first become eligible for Medicare and each year from October 15th to December 7th.

EMPLOYER GROUP PLAN If you decide to drop your current coverage with Applied Industrial Controls, you will be eligible for a two (2) month Special Enrollment Period (SEP) to join a Medicare drug plan. However you also may pay a higher premium (a penalty) because you did not have creditable coverage under HDHP. When Will You Pay A Higher Premium (Penalty) To Join A Medicare Drug Plan?

Since the coverage under Cigna HSA plan, is not creditable, depending on how long you go without creditable prescription drug coverage you may pay a penalty to join a Medicare drug plan. Starting with the end of the last month that you were first eligible to join a Medicare drug plan but didn’t join, if you go 63 continuous days or longer without prescription drug coverage that’s creditable, your monthly premium may go up by at least 1% of the Medicare base beneficiary premium per month for every month that you did not have that coverage. For example, if you go nineteen months without creditable coverage, your premium may consistently be at least 19% higher than the Medicare base beneficiary premium. You may have to pay this higher premium (penalty) as long as you have Medicare prescription drug coverage. In addition, you may have to wait until the following October to join.

Applied Industrial Controls Benefit Guide | 27

IMPORTANT NOTICE ABOUT YOUR PRESCRIPTION DRUG COVERAGE & MEDICARE NON-CREDITABLE (CONT.) When Will You Pay A Higher Premium (Penalty) To Join A Medicare Drug Plan?

If you decide to join a Medicare drug plan, your current Applied Industrial Controls coverage may be affected. Please review prescription drug coverage plan provisions/options under the certificate booklet provided by Cigna.

See pages 7- 9 of the CMS Disclosure of Creditable Coverage To Medicare Part D Eligible Individuals Guidance (available at http:// www.cms.hhs.gov/CreditableCoverage/), which outlines the prescription drug plan provisions/options that Medicare eligible individuals may have available to them when they become eligible for Medicare Part D. If you do decide to join a Medicare drug plan and drop your current Applied Industrial Controls coverage, be aware that you and your dependents may not be able to get this coverage back. drug plan. When you make your decision, you should compare your current coverage, including what drugs are covered, with the coverage and cost of the plans offering Medicare prescription drug coverage in your area. Read this notice carefully - it ex- plains your options.

For more information about this notice or your current prescription drug coverage contact human resources.

NOTE: You’ll get this notice each year. You will also get it before the next period you can join a Medicare drug plan, and if this coverage through Applied Industrial Controls changes. You also may request a copy of this notice at any time.

More detailed information about Medicare plans that offer prescription drug coverage is in the “Medicare & You” handbook. You’ll get a copy of the handbook in the mail every year from Medicare. You may also be contacted directly by Medicare drug plans. For more information about Medicare prescription drug coverage Visit www.medicare.gov. Call your State Health Insurance Assistance Program (see the inside back cover of your copy of the “Medicare & You” handbook for their telephone number) for personalized help Call 1-800-MEDICARE (1800-633-4227). TTY users should call 1-877-486- 2048. If you have limited income and resources, extra help paying for Medicare prescription drug coverage is available. For information about this extra help, visit Social Security on the web at www.socialsecurity.gov, or call them at 1-800-772-1213 (TTY 1-800-325-0778).

Remember: Keep this Creditable Coverage notice. If you decide to join one of the Medicare drug plans, you may be required to provide a copy of this notice when you join to show whether or not you have maintained creditable coverage and, therefore, whether or not you are required to pay a higher premium (a penalty).

Applied Industrial Controls Benefit Guide | 28

MEDICAL – THINGS TO KEEP IN MIND Since your plans run on a calendar year basis, all deductible and out of pocket amounts will reset to $0 on January 1.

4th quarter deductible carryover feature. This is available on the Base & Buy-Up Plans ONLY (not available on the HSA plan per IRS rules). If you have any deductible-related services that actually OCCUR in October, November or December, those deductible amounts satisfied will automatically be applied to your 2021 calendar year deductible by Cigna. This does NOT include any coinsurance, copays, or out of pocket amounts, ONLY deductible.

You will receive a new ID card in the mail from Cigna. It will be a plain white envelope so be careful not to overlook and toss it.

HEALTH INSURANCE TERMINOLOGY Health insurance terminology can be confusing. As a result, understanding your benefits and what you may owe out of pocket can be difficult. In order to make sure you are using your coverage effectively, it is important to understand some key insurance terms.

You can purchase either group or individual health insurance. Group health insurance is typically acquired through your employer and covers many people.

Individual insurance, on the other hand, is usually purchased by an individual or a family and is not tied to a job.

To better understand your health insurance, be aware of the following terms: Participant There are a few different participants involved in health insurance. One is the “provider”, or a clinic, hospital, doctor lab, health care practitioner or pharmacy. The ”insurer” or the “carrier” is the insurance company providing coverage. The “policyholder” is the individual or entity who purchased the coverage, and the “insured” is the person with the coverage”.

Premium The amount of money charged by an insurance company for coverage. Rates are typically paid annually or in smaller payments over the course of the year (for example monthly).

Deductible The amount you owe for health care services each year before your insurance company begins to pay. Your deductible may not apply to all services, such as preventive care.

Copayment The fixed amount that you pay for a covered health care service. That amount can vary by the type of covered health care service (for example, a doctor’s office visit or a specialist, urgent care or emergency room visit).

Coisurance The percentage of a medial bill that you pay (for example, 20 percent) and the percentage that the health plan pays (for example, 80 percent). You pay coinsurance plus any deductible you owe for a covered health service.

20%

20%

You Pay Health Plan Pays

Out-of-pocket maximum (OOPM) The most you should have to pay for health care during a year, excluding the monthly premium. After you reach the annual OOPM, your plan begins to pay 100 percent of the allowed amount for covered health services.

Applied Industrial Controls Benefit Guide | 29