Short Term Disability and Long Term Disability Insurance Plans

Transcription

1 S U M M A R Y P L A N D E S C R I P T I O N L-3 Communications Corporation Short Term Disability and Long Term Disability Insurance Plans Effective January 1, 2012 L - 3 C O M M U N I C A T I O N S

2 Table of Contents The Short Term Disability and Long Term Disability Plans 1 Before You Begin 1 Eligibility and Participation 2 Who s Eligible 2 When Coverage Begins 2 Cost of Coverage 3 How the Short Term Disability Plan Works 4 What Qualifies as a Short Term Disability 4 How STD Benefits Are Payable 4 Residual Disability Work Incentive Benefit 6 Approved Rehabilitation Program 6 What s Not Covered Under the STD Plan 6 When STD Benefits End 7 How the Long Term Disability Plan Works 8 What Qualifies as a Long Term Disability 8 How LTD Benefits Are Payable 8 Duration of Benefit Payments 10 Successive Periods of Disability 10 Psychiatric or Substance Abuse-Related Disabilities 10 Residual Disability Work Incentive Benefit 11 Spouse Rehabilitation Benefit 12 Approved Rehabilitation Program 12 Survivor Benefits 12 What s Not Covered Under the LTD Plan 13 When LTD Benefits End 13 Claiming Benefits 15 Responding to Your STD Claim 15 Responding to Your LTD Claim 15 How Benefits Can Be Delayed or Denied 16 Claims Denial Notification 16 Appealing a Denied Claim 17 Other Information You Should Know 19 When Your Earnings Change 19 How Other Benefits Are Affected 19 When Coverage Ends 19 Converting to an Individual Policy 20 Ownership of Benefits 20 Plan Administration 21 Compliance With Federal and State Law 21

3 Future of the Plans 21 Your Rights Under ERISA 22 Prudent Actions by Plan Fiduciaries 22 Enforcing Your Rights 23 Assistance With Your Questions 23 Plan Facts 24 Glossary 25

4 The Short Term Disability and Long Term Disability Plans The L-3 Communications Short Term Disability (STD) and Long Term Disability (LTD) Plans provide replacement income during a period of illness or injury. Before You Begin This Summary Plan Description describes the most important features of the Short Term Disability and Long Term Disability Plans (the Plans ). Please read it and refer to it when you have any questions about the Plans. We have tried to explain the Plans in everyday language, but you will come across some words and phrases that have specific meanings within the context of the Plans. To help you understand them, they are italicized when first used and included in the Glossary that starts on page 25. Also be sure to read the Other Information You Should Know section of this Summary Plan Description for important information and facts about your rights under the Plans. The Short Term Disability and Long Term Disability Plans help protect you and your family from the financial consequences of serious illness or injury. Certain Plan provisions vary by business unit. These provisions are specified in the accompanying Supplement, which is part of the Summary Plan Description. Defined terms in the Supplement have the same meaning they have in this booklet. The actual provisions of the Short Term Disability and Long Term Disability Plans are set forth in the respective insurance policies between L-3 and Aetna. Should this Summary Plan Description differ from the insurance policy, the terms of the insurance policy will govern. t h e s t d a n d l t d p l a n s 1

5 Eligibility and Participation Certain rules governing eligibility and participation may differ by business unit or employee classification, particularly for collectively bargained employees or employees subject to the Service Contract Act (SCA). If the terms of your eligibility and participation differ from the information below, it is specified in your Supplement. Certain rules governing eligibility and participation may differ from those shown in this SPD booklet, depending on your business unit or employee classification. If this is the case, it will be specified in the Supplement. Who s Eligible You are eligible for STD and LTD Plan coverage if you are regularly scheduled to work 20 hours or more per week and employed in a job classification designated as benefits-eligible. If you are a collectively bargained employee, the terms of your collective bargaining agreement will govern your eligibility. If you have any questions about your eligibility, contact the L-3 Benefit Center at When Coverage Begins Short Term Disability Plan. You are automatically enrolled in the STD Plan on your first day at work, unless otherwise specified in your Supplement, your collective bargaining agreement or the terms of your Service Contract Act (SCA) employment (if applicable). Long Term Disability Plan. You are automatically enrolled in the LTD Plan on your first day at work. If you wish to waive coverage, you must do so through the L-3 Benefit Center. If you decline LTD coverage initially and want to enroll in the future, you will be required to provide evidence of insurability (EOI) and be approved by Aetna, the LTD Plan insurer. To provide EOI, you may have to provide a statement of your health history or other evidence of good health, such as a medical examination (at your own expense). You will satisfy the insurability requirement on the day Aetna agrees in writing to accept you as covered under the policy. If you are absent from work because of illness or injury on the day STD and/or LTD coverage is supposed to begin, it will start on the day you return to work. 2 e l i g i b i l i t y a n d p a r t i c i p a t i o n

6 Cost of Coverage Short Term Disability Plan. L-3 pays the full cost of STD coverage, unless otherwise specified in your Supplement, your collective bargaining agreement or the terms of your Service Contract Act (SCA) employment (if applicable). If you work in a state that mandates short term disability benefits, you may be required to pay state disability-related payroll taxes. Long Term Disability Plan. You pay the full cost of LTD coverage through after-tax payroll deductions, unless otherwise specified in your collective bargaining agreement (if applicable). Your LTD contributions are calculated by multiplying the current monthly rate times each $100 of your earnings. The cost of LTD coverage is subject to change from time to time; the L-3 Benefit Center can tell you what the current monthly rate is. Benefits payable from the LTD Plan are not taxable because you pay the full cost of coverage on an after-tax basis. Benefits payable from the LTD Plan are not taxable because you pay the full cost of coverage on an after-tax basis. e l i g i b i l i t y a n d p a r t i c i p a t i o n 3

7 You are considered disabled if you are unable, due to a covered injury or sickness, to perform the material duties of your regular occupation and therefore are unable to earn more than 80% of your pre-disability earnings. How the Short Term Disability Plan Works The Short Term Disability (STD) Plan provides a source of income if you are unable to work because of a non-occupational illness or injury. Benefits start on your eighth calendar day of absence, unless otherwise specified in your collective bargaining agreement (if applicable), and are payable for up to 13 or 26 weeks, depending on your business unit. See the Supplement for the STD duration period in effect at your business unit. A period of disability will be considered continuous even if you return to work temporarily for up to a total of 30 days. If you work during your period of disability (either at your regular occupation on a part-time basis, or any other occupation on a full-time or part-time basis), your disability benefit may be reduced. When you are absent due to disability, your disability leave runs concurrently with federal Family and Medical Leave Act (FMLA) leave. That is, any weeks of absence due to disability will be included as part of the 12-week maximum leave allowed under FMLA. What Qualifies as a Short Term Disability To be eligible for STD Plan benefits, you must meet the STD Plan s definition of disabled. You are considered disabled if you are unable, due to a covered injury or sickness, to perform the material duties of your regular occupation and therefore are unable to earn more than 80% of your pre-disability earnings. In addition, you must be under the care of a licensed physician throughout your disability for benefits to be payable. Aetna, the STD Plan insurer, may require that your continued disability be certified from time to time. In all circumstances, Aetna is responsible for determining whether you are disabled, as defined by the Plan. In doing so, it has full discretionary authority to rely on its own materials, expertise and procedures, especially in determining issues concerning defined terms in the insurance contract. Aetna has final and complete discretionary authority to make all such determinations. How STD Benefits Are Payable The STD Plan replaces a percentage of your pre-disability earnings. Refer to the Supplement for the benefit percentage that applies at your business unit. There is no weekly benefit maximum, unless otherwise specified in your collective bargaining agreement (if applicable). Other sources of income. While you are disabled, you may be eligible for benefits from other sources. The STD Plan takes into account these other sources of income you and/or any of your dependents, if applicable, receive or are assumed to receive due to the same disability. That means your STD Plan benefits will be reduced by income payable from the following sources due to the same disability: Disability, retirement or unemployment benefits required or provided for by government law, including (but not limited to): unemployment compensation benefits 4 h o w t h e S T D p l a n w o r k s

8 disability benefits under any Workers Compensation law or similar law meant to compensate a worker for loss or past and future wages, impaired earning capacity, a lessened ability to compete for jobs, any permanent impairment and any loss of bodily function or capacity (applies to certain collective bargaining agreements only; see your Supplement for more information) benefits under the Federal Social Security Act, Railroad Retirement Act, Canada Pension Plan and/or Quebec Pension Plan veteran s benefits (Note: Veteran s benefits you are already receiving for a prior disability will not be used to reduce disability benefits.) State disability benefits Other disability or unemployment benefits payable as a result of your employment with L-3 or your membership in or association with any group, association, union or other organization (such as a plan offered by a professional association) Any retirement benefits you receive under an L-3-sponsored retirement plan as a result of your disability Liability insurance or other sources (e.g., damages or settlement received through legal action) for a disability caused by a third party Disability benefits from an L-3-sponsored accumulated sick time or salary continuation program 50% of any award given under the Jones Act or the Maritime Doctrine of Maintenance, Wages and Cure. If your weekly income from these sources does not add up to the STD benefit amount you are eligible to receive, the STD Plan will make up the difference. If the income payable from another source is paid in a lump sum, it will be pro-rated on a weekly basis over the period of time for which the payment was made and used to offset your STD Plan benefits accordingly. If no time span is specified, then the lump sum will be pro-rated weekly over your expected lifetime. Once your STD Plan benefit is set, a cost-of-living increase in income from a government source (e.g., Social Security) will not reduce your STD benefits further. Aetna may require proof that you and your eligible dependents, if applicable, have applied for all other income benefits you may be eligible to receive as a result of your disability and if denied, have made a timely appeal of any denial through the highest administrative level. STD benefits will be reduced by other sources of income you and/or your eligible dependents are eligible to receive as a result of your disability (e.g., Social Security benefits or state-mandated disability benefits). You are assumed to receive any of the other income benefits described here if you are eligible for them whether or not you actually receive them. It is your responsibility to claim all benefits you re eligible for and to ensure that you receive the correct amount. If you apply for Social Security benefits and are denied, you must request reconsideration within 60 days after the denial unless Aetna states in writing that you are not required to. If the reconsideration is denied, you must apply for a hearing before an administrative law judge within 60 days of the denial, unless Aetna waives this requirement. h o w t h e S T D p l a n w o r k s 5

9 Residual Disability Work Incentive Benefit You may be eligible for a work incentive benefit if you can return to your regular occupation on a part-time basis or you can do some other job on a full-time or part-time basis for less pay. Ordinarily, your STD Plan benefits end when you return to active employment. However, you may be eligible for a work incentive benefit if you are residually disabled, which means you can come back to work at your regular occupation on a part-time basis or you can perform some work at any other occupation on a full-time or part-time basis for less pay. The amount of your benefit under this provision is determined using your adjusted pre-disability earnings. Your work incentive benefit will equal your regular STD Plan benefit. However, if the sum of your regular STD Plan benefit, employment earnings and other income benefits (as described on pages 4 and 5) exceeds 100% of your adjusted pre-disability earnings, your Plan benefit will be reduced by the excess amount. For example, assume your business unit s STD benefit percentage is 60% and your adjusted pre-disability earnings are $3,000 a month, making your regular monthly STD Plan benefit $1,800 (60% of $3,000). If you are able to return to work on a residually disabled basis for $1,200 a month, then your income while you are employed on a residually disabled basis would be: $1,200 employment earnings +1,800 work incentive benefit (regular STD Plan benefit) $3,000 total income (which is limited to 100% of your pre-disability earnings) However, if you were also receiving $700 a month from Social Security, your work incentive benefit would be reduced by $700, to $1,100 a month, because you cannot earn more than your adjusted pre-disability earnings ($3,000 a month). Approved Rehabilitation Program If Aetna determines you are a suitable candidate for a rehabilitation program that provides services and supplies intended to enable you to return to work, it will evaluate you and work with you to formulate an approved rehabilitation program. This program may include vocational testing or training, alternative treatments (e.g., support groups, physical therapy), workplace modification, part-time employment and/or job placement. Aetna will pay for all pre-approved services and supplies, except those for which you can be reimbursed by another payer. 6 h o w t h e S T D p l a n w o r k s What s Not Covered Under the STD Plan The STD Plan does not cover any disability that occurs while you are confined to a penal or correctional institution for conviction of a criminal act or other public offense. STD Plan benefits also are not payable for disabilities that result directly or indirectly from: occupational illnesses or injuries intentionally self-inflicted injuries participation in a riot or insurrection war or an act of war (declared or undeclared) commission of, or attempted commission of, a felony a motor vehicle accident caused by your driving while under the influence of alcohol (as determined by state law).

10 When STD Benefits End STD Plan benefits will end on the earliest of the following: the date you no longer meet STD Plan s definition of disabled the date you are no longer under the regular care of a physician the date you fail to provide requested proof of your disability the date you refuse to be examined by or cooperate with an independent physician or a licensed and certified health care physician, as requested by Aetna the date an independent medical exam report or functional capacity evaluation does not, in Aetna s opinion, confirm that you meet the STD Plan s definition of disabled STD benefits will end on the date you no longer meet the STD Plan s definition of disabled. the date you reach the end of the maximum benefit duration period, as shown in the Supplement if alcoholism and drug abuse are the cause (or part of the cause) of your disability, the date you are no longer receiving effective treatment for alcoholism or drug abuse, as determined by Aetna the date you refuse to cooperate with or accept changes to your work site or job process designed to suit your identified medical limitations the date you refuse to cooperate with or accept any adaptive equipment or devices designed to suit your identified medical limitations that would allow you to perform your pre-disability occupation the date you refuse treatment recommended by your physician that would, in Aetna s opinion, cure, correct or limit your disability the date your condition would allow you to work, increase the hours you work, or increase the number or type of duties you perform in your pre-disability occupation, and you refuse to do so the date you become eligible for disability benefits under another L-3 plan (and this date occurs after the date the group contract ends) the date of your death. h o w t h e S T D p l a n w o r k s 7

11 You must be under the care of a licensed physician throughout your disability for benefits to be payable. Aetna may require that your continued disability be certified from time to time. How the Long Term Disability Plan Works The Long Term Disability (LTD) Plan provides a source of income if an illness or injury makes you unable to work for an extended period of time. Benefits are payable once you have been totally disabled (see definition below) for the LTD Plan s waiting period either 90 or 180 days, depending on your business unit. See the Supplement for the LTD waiting period in effect at your business unit. A period of disability will be considered continuous even if you return to work temporarily for up to a total of 30 days during the waiting period. In addition, if you work during the waiting period (which, even though you meet the Plan s definition of totally disabled, you may be able to do on a less than full-time basis), any hours you work may count toward satisfying the waiting period as long as you don t work more than 30 days. If you work while you are receiving LTD Plan benefits (either at your regular occupation on a part-time basis, or any other occupation on a full-time or part-time basis), your disability benefit may be reduced. What Qualifies as a Long Term Disability To be eligible for LTD Plan benefits, you must meet the LTD Plan s definition of totally disabled. During the first 24 months in which LTD Plan benefits are payable: You are considered totally disabled if you are unable, due to a covered injury or sickness, to perform the material duties of your regular occupation and therefore are unable to earn more than 80% of your pre-disability earnings. After 24 months of disability: You are considered totally disabled if you are unable, due to a covered injury or sickness, to perform the material duties of any occupation for which you are qualified, or may reasonably become qualified by training, education or experience. In addition, you must be under the care of a licensed physician throughout your disability for benefits to be payable. Aetna, the LTD Plan insurer, may require that your continued disability be certified from time to time. In all circumstances, Aetna is responsible for determining whether you are totally disabled, as defined by the Plan. In doing so, it has full discretionary authority to rely on its own materials, expertise and procedures, especially in determining issues concerning defined terms in the insurance contract. Aetna has final and complete discretionary authority to make all such determinations. How LTD Benefits Are Payable The LTD Plan replaces a percentage of your pre-disability earnings. Refer to the Supplement for the benefit percentage that applies at your business unit. The minimum monthly benefit the LTD Plan will pay is $100; the maximum benefit payable is $25,000 per month. 8 h o w t h e LT D p l a n w o r k s

12 Other sources of income. While you are disabled, you may be eligible for benefits from other sources. The LTD Plan takes into account these other sources of income you and/or any of your dependents, if applicable, receive or are assumed to receive due to the same disability. That means your LTD Plan benefits will be reduced by income payable from the following sources due to the same disability: Disability, retirement or unemployment benefits required or provided for by government law, including (but not limited to): unemployment compensation benefits disability benefits under any Workers Compensation law or similar law meant to compensate a worker for loss or past and future wages, impaired earning capacity, a lessened ability to compete for jobs, any permanent impairment and any loss of bodily function or capacity benefits under the Federal Social Security Act, Railroad Retirement Act, Canada Pension Plan and/or Quebec Pension Plan veteran s benefits (Note: Veteran s benefits you are already receiving for a prior disability will not be used to reduce disability benefits.) State disability benefits Other disability or unemployment benefits payable as a result of your employment with L-3 or your membership in or association with any group, association, union or other organization (such as a plan offered by a professional association) You are assumed to receive any of the other income benefits described here if you are eligible for them whether or not you actually receive them. It is your responsibility to claim all benefits you re eligible for and to ensure that you receive the correct amount. Any retirement benefits you receive under an L-3-sponsored retirement plan as a result of your disability Liability insurance or other sources (e.g., damages or settlement received through legal action) for a disability caused by a third party Disability benefits from an L-3-sponsored accumulated sick time or salary continuation program 50% of any award given under the Jones Act or the Maritime Doctrine of Maintenance, Wages and Cure. If your monthly income from these sources does not add up to the LTD benefit amount you are eligible to receive, the LTD Plan will make up the difference. If the income payable from another source is paid in a lump sum, it will be pro-rated on a monthly basis over the period of time for which the payment was made and used to offset your LTD Plan benefits accordingly. If no time span is specified, then the lump sum will be pro-rated monthly over your expected lifetime. Once your LTD Plan benefit is set, a cost-of-living increase in income from a government source (e.g., Social Security) will not reduce your LTD benefits further. Aetna may require proof that you and your eligible dependents, if applicable, have applied for all other income benefits you may be eligible to receive as a result of your disability and if denied, have made a timely appeal of any denial through the highest administrative level. h o w t h e LT D p l a n w o r k s 9

13 If you apply for Social Security benefits and are denied, you must request reconsideration within 60 days after the denial unless Aetna states in writing that you are not required to. If the reconsideration is denied, you must apply for a hearing before an administrative law judge within 60 days of the denial, unless Aetna waives this requirement. Social Security is expected to provide a portion of your disability income. It pays benefits to you, after a five-month waiting period, if you are considered permanently disabled. It is your responsibility to claim Social Security benefits and ensure that you receive the correct amount. Your Plan benefit will be coordinated with the Social Security benefit you (and your family, if applicable) are eligible to receive, whether or not you actually receive it. Contact Aetna for assistance with the Social Security benefits application or appeal process. Duration of Benefit Payments If you become totally disabled before your 62nd birthday, LTD Plan benefits are payable until you reach age 65. If you become totally disabled at age 62 or later, benefits are payable as shown on this chart. Age at Disability At least 62 but not yet 65 At least 65 but not yet 67 At least 67 but not yet 69 Maximum Benefit Period 36 months 24 months 18 months 69 or over 12 months Successive Periods of Disability If you are receiving LTD Plan benefits, return to active service with L-3 for six consecutive months or less and become disabled again from the same or a related cause, your benefits will resume without you having to satisfy the waiting period. However, you will have to satisfy the waiting period again before benefits can resume in either of the following situations: You come back to work for more than six consecutive months and become disabled again from the same or a related cause. Your second period of disability results from a cause that is unrelated to the first. Psychiatric or Substance Abuse-Related Disabilities If you are disabled because of a mental health or psychiatric condition, or alcohol and/or drug abuse, the LTD Plan generally will pay no more than 24 months of benefits. For benefits to be payable for more than 24 months, you must be confined to a hospital or treatment facility for treatment of your condition at the end of the 24-month period. If the inpatient confinement lasts less than 30 days, LTD Plan benefits will end on the date you are no longer confined. If your confinement lasts 30 days or more, LTD Plan benefits will continue until 90 days after the date you are no longer confined. The rules described above, under Successive Periods of Disability, will not apply to a psychiatric or substance abuse-related disability that lasts 24 months or more. 10 h o w t h e LT D p l a n w o r k s

14 Residual Disability Work Incentive Benefit Ordinarily, your LTD Plan benefits end when you return to active employment. However, you may be eligible for a work incentive benefit if you are residually disabled, which means you can come back to work at your regular occupation on a part-time basis or you can perform some work at any other occupation on a full-time or part-time basis for less pay. As shown in the chart below, the amount of your benefit under this provision is determined using your adjusted pre-disability earnings. You may be eligible for a For This Period of Time The first 12 months after you return to work After 12 months Your Work Incentive Benefit Will Equal your regular LTD Plan benefit. If for any month during this period the sum of your regular LTD Plan benefit, employment earnings and other income benefits (as described on page 9) exceeds 100% of your adjusted pre-disability earnings, your Plan benefit will be reduced by the excess amount. your regular LTD Plan benefit reduced by 50% of your employment earnings. If for any month the sum of your regular LTD Plan benefit, employment earnings and other income benefits (as described on page 9) exceeds 80% of your adjusted pre-disability earnings, your benefit will be reduced by the excess amount. work incentive benefit if you can return to your regular occupation on a part-time basis or you can do some other job on a full-time or part-time basis for less pay. For example, if your adjusted pre-disability earnings are $3,000 a month, your regular LTD Plan benefit is $1,800 a month (assuming your business unit s LTD benefit percentage is 60%) and you return to work on a residually disabled basis for $1,200 a month: For the first 12 months after you return to work, the LTD Plan will pay you your full regular LTD Plan benefit of $1,800. Thus, your income while you are employed on a residually disabled basis would be: $1,200 employment earnings +1,800 work incentive benefit $3,000 total income (which is limited to 100% of your pre-disability earnings) After 12 months, the LTD Plan will reduce your monthly benefit by 50% of $1,200, which is $600, leaving you with a work incentive benefit of $1,200 ($1,800 $600 = $1,200). Thus, your income while you are employed on a residually disabled basis would be: $1,200 employment earnings +1,200 work incentive benefit $2,400 total income (which is limited to 80% of your pre-disability earnings). h o w t h e LT D p l a n w o r k s 11

15 Spouse Rehabilitation Benefit While you are disabled, the LTD Plan may help your spouse improve his/her earnings potential by paying certain of his/her education or job placement expenses. You and your spouse must meet all of the following conditions for this benefit to be payable: Your spouse may be eligible for assistance with his/her earnings potential through the Spouse Rehabilitation Benefit while you are on a long term disabilityrelated leave of absence. you must have been continuously disabled for 12 months your spouse s earnings cannot be more than 60% of your pre-disability covered earnings Aetna must consider your spouse to be a suitable candidate your condition must prohibit you from participating in an Approved Rehabilitation Program. You must request this benefit in writing from Aetna. If your spouse s earnings are more than 80% of your adjusted pre-disability earnings as a result of participation in this program, the LTD Plan will reduce your LTD benefit by 50% of your spouse s earnings. If your spouse was working prior to your disability and his/her earnings increase by more than 20% as a result of participation in the program, the LTD Plan will reduce your LTD benefit by 50% of your spouse s increase in earnings. Approved Rehabilitation Program If Aetna determines you are a suitable candidate for a rehabilitation program that provides services and supplies intended to enable you to return to work, it will evaluate you and work with you to formulate an approved rehabilitation program. This program may include vocational testing or training, alternative treatments (e.g., support groups, physical therapy), workplace modification, part-time employment and/or job placement. Aetna will pay for all pre-approved services and supplies, except those for which you can be reimbursed by another payer. Survivor Benefits If you die while totally disabled and receiving monthly LTD Plan benefits, the LTD Plan will pay a single lump-sum benefit to your eligible survivor. The lump-sum survivor benefit amount will be equal to six times the monthly LTD benefit for which you were eligible in the full month prior to the month of your death, not reduced by any other income benefits. For example, if you received a $2,000 LTD benefit in September and die in October, your eligible survivor will receive a lump-sum payment of $12,000 ($2,000 x 6 = $12,000) following your death. If you have no surviving legally married spouse, the survivor benefit will be paid in equal shares to your unmarried biological or legally adopted children under age 25 who depended on you for support at the time of your death. 12 h o w t h e LT D p l a n w o r k s

16 What s Not Covered Under the LTD Plan The LTD Plan does not cover any disability that occurs while you are confined to a penal or correctional institution for conviction of a criminal act or other public offense. LTD Plan benefits also are not payable for disabilities that result directly or indirectly from: intentionally self-inflicted injuries participation in a riot or insurrection war or an act of war (declared or undeclared) commission of, or attempted commission of, a felony a motor vehicle accident caused by your driving while under the influence of alcohol (as determined by state law). Pre-existing conditions. Aetna will not pay benefits for any disability that is caused by, contributed to by, or results from a pre-existing condition until you have been covered under the LTD Plan for 12 consecutive months (six months if you are age 65 or older). A pre-existing condition is any illness or injury for which you did, or for which a reasonable person would have done, any of the following within three months before the date you became covered by the LTD Plan: The LTD Plan will not pay benefits for a pre-existing condition until you have been covered under the LTD Plan for 12 consecutive months (six consecutive months if you are age 65 or older). incurred expenses were diagnosed or treated, or received diagnostic or treatment services took drugs or medicines that were prescribed or recommended by a physician. Please note if you are a new hire, or you are joining the LTD Plan as a result of L-3 s acquisition of your employer, and you were covered under a group disability plan (whether insured or employer-provided) at least 60 days before the date you became covered under the L-3 LTD Plan, Aetna will credit you for time you were covered under the other plan in determining whether a pre-existing condition applies. When LTD Benefits End LTD Plan benefits will end on the earliest of the following: the date you no longer meet LTD Plan s definition of totally disabled the date you are no longer under the regular care of a physician the date Aetna finds out you have withheld information about working or being able to work at a reasonable occupation the date you fail to provide requested proof of your disability the date you refuse to be examined by or cooperate with an independent physician or a licensed and certified health care physician, as requested by Aetna h o w t h e LT D p l a n w o r k s 13

17 the date an independent medical exam report or functional capacity evaluation does not, in Aetna s opinion, confirm that you meet the LTD Plan s definition of totally disabled the date you reach the end of the maximum benefit duration period, as shown on page 10 LTD benefits will end on the date you no longer meet the LTD Plan s definition of disabled. if alcoholism and drug abuse are the cause (or part of the cause) of your disability, the date you are no longer receiving effective treatment for alcoholism or drug abuse, as determined by Aetna the date you refuse to cooperate with or accept changes to your work site or job process designed to suit your identified medical limitations the date you refuse to cooperate with or accept any adaptive equipment or devices designed to suit your identified medical limitations that would allow you to perform your pre-disability occupation the date you refuse treatment recommended by your physician that would, in Aetna s opinion, cure, correct or limit your disability the date your condition would allow you to work, increase the hours you work, or increase the number or type of duties you perform in your pre-disability occupation, and you refuse to do so the date of your death. 14 h o w t h e LT D p l a n w o r k s

18 Claiming Benefits If you become disabled and expect to be absent from work for more than seven calendar days, follow this process to claim disability benefits: Immediately contact your local Human Resources Department to report your injury, illness or scheduled absence. Report the absence to Aetna by calling or going online to You must contact Aetna to initiate your claim as soon as you expect a disability-related absence to last more than seven calendar days. Scheduled disabilities (e.g., surgery, pregnancy, etc.) should be reported no more than 30 days prior to the disability. Your Human Resources Department will explain how it works. Submit claims to Aetna by calling or going online to Aetna has the right to require you to submit a signed statement identifying all other income benefits for which you are eligible and proof that you and your dependents have applied for them. Your claim for benefits will be delayed or denied if you do not return any information requested by the insurance company on a timely basis. Responding to Your STD Claim For newly filed STD claims, Aetna will attempt to collect any missing information through a combination of written and telephonic inquiries to you, your employer and/or your physician, as applicable. Aetna will conduct a minimum of three telephone outreach calls per employee, employer and physician. In the event that the missing information is still not received 10 business days following the date your claim was filed, Aetna will approve, suspend or deny the claim at that point and notify you of its decision. Responding to Your LTD Claim For properly filed LTD claims, Aetna will make a decision on the claim and notify you of its decision within 45 days. If Aetna needs more time for reasons beyond its control, it will notify you of the reason for the delay and the date the decision will be made, and it will do so before the 45-day period expires. Aetna will make its decision within 30 days of notifying you of the delay, although it may take an additional 30 days as long as it notifies you, before the first 30-day extension period expires, of the circumstances requiring the second extension and the date by which Aetna expects to make a decision. If Aetna needs an extension because it needs additional information from you, the extension notice will specify the information needed. In that case, you will have 45 days from receipt of the notification to supply the additional information. If you do not provide the information within that time, your claim will be denied. Aetna will notify you of its decision within 30 days of receiving in a timely manner the additional information that it requested. c l a i m i n g b e n e f i t s 15

19 How Benefits Can Be Delayed or Denied Benefit payments may be delayed or denied if: you or your beneficiary do not properly file a claim for benefits on time You may have an authorized representative act on your behalf in filing a claim or an appeal of a denied claim. you, your doctor or your beneficiary do not furnish information required to complete or verify a claim your or your beneficiary s current address is not on file with L-3 or the Plan Administrator. If you improperly file a claim, Aetna will notify you as soon as possible and give you the opportunity to properly refile the claim. Keep in mind that if a claim form has to be returned to you for more information, delays in payment may result. If the Plan mistakenly pays you a greater benefit than you are entitled to, Aetna may seek permissible remedies (as allowed by law) to recover benefits paid to you in error. Claims Denial Notification Aetna will notify you in writing if your claim has been denied, either in full or in part. This notice will state: the specific reason(s) for the denial reference to the specific Plan provision(s) on which the denial is based a description of any additional material or information necessary to support the claim, and an explanation of why the material or information is necessary an explanation of the appeal procedures, including a statement that you may bring a civil action under Section 502(a) of ERISA but only after you have followed the Plan s claims procedures and received an adverse decision on appeal a copy of any internal rule, guideline or protocol that was relied on in making the determination or a statement that it is available upon request at no charge an explanation of any scientific or clinical judgment that formed the basis for the determination, or a statement that it is available upon request at no charge. 16 c l a i m i n g b e n e f i t s

20 Appealing a Denied Claim If your claim is denied in whole or in part, or if you disagree with the decision made on a claim, you may ask for a review. Your request for review must be made in writing to Aetna within 180 days after you receive notice of denial. How the review process works. You have the right to review documents relevant to your claim. You may submit written comments, documents, records and other information relevant to the claim. In addition, as part of the review procedure, you will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claim. A document, record or other information is relevant if it falls into any of the following categories: Aetna relied on it in making the decision You must complete each step of the claim and appeal procedure before you can take legal action. Aetna submitted, considered or generated it (regardless of whether it was relied upon) it demonstrates compliance with the Plan s administrative processes for ensuring consistent decision-making it constitutes a statement of Plan policy regarding the denied treatment or service. Upon request, you will be provided with the identification of medical or vocational experts, if any, who gave advice to Aetna on your claim, without regard to whether their advice was relied upon in deciding your claim. A different person will review your claim than the one who originally denied the claim. The reviewer will not give deference to the initial adverse benefit determination. The decision will be made on the basis of the record, including such additional documents and comments that you may submit. If your claim was denied on the basis of a medical judgment, a health care professional who has appropriate training and experience in a relevant field of medicine will be consulted. When you ll be notified. You will be sent a notice of decision on review within 45 days after you file your appeal. If Aetna requires up to an additional 45 days for reasons beyond its control, it will notify you of the reason for the delay and the date the decision will be made. You will be notified before the expiration of the original 45-day period. c l a i m i n g b e n e f i t s 17

21 How you ll be notified. Aetna will notify you in writing of its decision on your appeal of a denied claim. This notice will state: the specific reason(s) for the decision reference to the specific Plan provision(s) on which the decision is based If you have any questions regarding the claims appeal process, contact the Aetna Appeal Department at a statement that you may have access to or copies of all documents or records that are relevant to your claim free of charge a statement that you have a right to bring a court action under Section 502(a) of ERISA following an adverse benefit determination on review if an internal rule, guideline or protocol was relied upon in making the decision, you will receive either a copy of the rule, guideline or protocol or a statement that it is available upon request at no charge if the determination is based on medical reasons, you will receive an explanation of the scientific or clinical judgment for the determination applying the terms of the Plan to your claim, or a statement that it is available upon request at no charge. Please note that you may not start a lawsuit to obtain benefits until after you have requested a review and a final decision has been reached on review, or until the appropriate timeframe described in this booklet has elapsed since you filed a request for review and you have not received a final decision or notice that an extension will be necessary to reach a final decision. The law also permits you to pursue your remedies under section 502(a) of the Employee Retirement Income Security Act without exhausting these appeal procedures if the Plan has failed to follow them. No action at law or in equity (that is, no lawsuit) may be brought (started) more than three years after written proof of loss must be furnished. If you have any questions regarding the claims appeal process, contact the Aetna Appeal Department at c l a i m i n g b e n e f i t s

22 Other Information You Should Know This booklet is provided to you so that you may generally know about the benefits offered under the L-3-sponsored Short Term Disability and Long Term Disability Plans (the Plans ) and the steps you must follow to take full advantage of the Plans. The previous sections describe the most important features of the Plans; what you will find here is important administrative information and facts about your rights as a participant in these Plans. This booklet and the accompanying Supplement constitute the Summary Plan Description (SPD) for L-3 s Short Term Disability and Long Term Disability Plans. The actual provisions of the Plans are set forth in the insurance policies and claims fiduciary agreements between L-3 Communications Corporation and Aetna. Should this Summary Plan Description differ from the insurance policies and claims fiduciary agreements, the terms of the insurance policies and claims fiduciary agreements will govern. This section contains important administrative information and facts about your rights as a participant in the Plans. When Your Earnings Change Your Plan coverage is based on your pre-disability earnings. If your earnings increase while you are on a disability leave, your benefit will not be increased. The increased coverage will go into effect on the day you return to work. How Other Benefits Are Affected Your other benefit coverage continues throughout a disability-related leave of absence, as long as you continue to make any required contributions. After 12 months, your other coverage will end, but you may be eligible to continue medical, dental and/or vision coverage through COBRA. Contact the L-3 Benefit Center at for more information. When Coverage Ends Your coverage under the Plans will end when the earliest of the following happens: your employment with L-3 terminates you are laid off you are no longer an eligible employee you do not make any required contributions (if applicable) the date the Plans are terminated. o t h e r i n f o r m a t i o n 19

23 Converting LTD Coverage to an Individual Policy You may be eligible for LTD conversion coverage if, for at least 12 consecutive months, you have been insured for disability benefits under the LTD Plan and are actively at work. You must apply for conversion insurance within 31 days after your insurance under the LTD Plan ends. Being a member of the Plan described in this booklet does not give you any right of continued employment with L-3. The conversion plan s benefits will be those offered by Aetna at the time you apply. The premium will be the rates in effect for conversion plans at that time. Conversion insurance is not available if any of the following apply: you have not been covered under the LTD Plan for at least 12 consecutive months your LTD coverage is ending for any of the following reasons: the L-3 LTD Plan is being terminated the L-3 LTD Plan is being amended to exclude from coverage the class of employees to which you belong you no longer meet the eligibility criteria you retire you fail to pay the required contributions you are disabled you recover from a disability and do not return to work at L-3 you are currently unable to work due to a mental or physical condition you are on a leave of absence you become covered under another employer s group long term disability plan within 31 days of your L-3 coverage terminating. Ownership of Benefits The benefits described here are exclusively for Plan participants or their properly designated beneficiaries. These benefits cannot be sold, transferred or assigned for any reason (except as provided by law). 20 o t h e r i n f o r m a t i o n

24 Plan Administration L-3 Communications Corporation, as the Plan Administrator, is responsible for the administration of the Plans. The L-3 Benefit Center and L-3 s Human Resources Department act on behalf of the Plan Administrator and are responsible for routine plan administration and answering questions about eligibility and coverage. The Plan Administrator has the full and complete discretionary authority and responsibility to administer the Plans and may delegate any or all of its authority and responsibility to any individuals or entities. The Plan Administrator has delegated to Aetna the full and complete discretionary authority and responsibility to decide all questions of eligibility for benefits under the Plans. For example, Aetna has the full and complete discretionary authority and responsibility to decide whether you are disabled under the terms of the Plans. Aetna s decisions are final and binding on all persons to the full extent permitted by law. Compliance With Federal and State Law Premium and contribution rates (if applicable) may change each year, subject to applicable collective bargaining agreements. In general, ERISA pre-empts state law. However, ERISA does not pre-empt state laws that regulate insurance. The Plans will always be construed to comply with applicable federal and state law. In the event there is no controlling federal or state law, the law of the State of New York will apply. Future of the Plans L-3 intends to continue the Short Term Disability and Long Term Disability Plans indefinitely, but reserves the right to change, terminate, amend or modify the Plans at any time, in any manner, at L-3 s sole discretion by action of the Vice President, Human Resources of L-3 Communications Corporation, according to the procedures spelled out in the official Plan documents and subject to applicable collective bargaining agreements. You will be notified of any change; however, the change, amendment, termination or modification may become effective before notice is given to you. Premium and contribution rates (if applicable) may change each year, subject to applicable collective bargaining agreements. f u t u re o f t h e p l a n s 21