First Health Announces Enhanced Product Offerings for the Mail Handlers Benefit Plan; Office of Personnel Management Publishes 2005 Rates

DOWNERS GROVE, Ill.--(BUSINESS WIRE)--Sept. 13, 2004--First Health (Nasdaq:FHCC), the administrator for the Mail Handlers Benefit Plan (MHBP), which is open to all federal and postal employees and annuitants, announced today that the Office of Personnel Management has published the rates for Federal Employees Health Benefits Program (FEHBP) plans, including the new and enhanced MHBP offerings for 2005.

After extensive research with federal employees, a number of changes to the MHBP offering have been made for 2005, including the introduction of a new MHBP Consumer Option, which combines a Health Savings Account (HSA) with a High Deductible Health Plan (HDHP), and the MHBP Standard Option, which has been enhanced. The Consumer and Standard Option are two of the best values for federal and postal employees and annuitants nationwide.

“In 2005, MHBP and First Health expect to continue to build on that success, with the added advantage of the new Consumer Option and all of the member service tools we have to support it.”

"This is the first year that HSAs will be offered in the Federal Employees Health Benefits Program, which provides a great opportunity for the MHBP and First Health to become leaders in this area for federal employees," said Susan Fleming, senior vice president, First Health. "First Health has conducted market research with federal employees to design a plan that delivers both short and long term value, coupled with the support First Health is known for - a national PPO network, 24/7/365 assistance by member service representatives and extensive web-based consumer decision tools."

To improve the Standard Option, focus groups were conducted nationally to identify what active and retired federal employees consider most when choosing a health plan. The Standard Option has subsequently been changed to reflect federal employees' desire for predictability, choice and simplicity. The plan will offer an improved preventive screenings benefit, lower annual family medical and prescription drug deductibles, and fixed co-pays for many services.

Research conducted indicates that over 60% of federal employees are seeking dental and vision plans. The National Postal Mail Handlers Union and First Health initially offered a dental and vision supplemental plan to MHBP members in 2004 and, because of the strong response to that offering, these plans are again being offered for 2005.

While MHBP continues to offer the High Option plan, the Consumer and Standard Option plans will be aggressively promoted during Open Season, the time of year when federal employees can select or change health plans.

"We are focusing on promoting the long-term growth of the Mail Handlers Benefit Plan," said Fleming. "We have created a number of solid options which will be actively marketed during Open Season. We expect that as federal and postal employees and annuitants become informed about the benefits of these offerings, they will select MHBP to meet their health care needs."

"In 2004, the Standard Option Plan nearly doubled in size and more than 35,000 supplemental dental and vision policies were purchased," said Fleming. "In 2005, MHBP and First Health expect to continue to build on that success, with the added advantage of the new Consumer Option and all of the member service tools we have to support it."

More details on the contribution rates for federal and postal employees and annuitants are available on the MHBP website, www.mhbp.com. The Mail Handlers Benefit Plan, open to all federal and postal employees and annuitants, is sponsored by the National Postal Mail Handlers Union and is administered by First Health. First Health, the premier national health-benefits services company, specializes in providing large payors with integrated managed care solutions. First Health is a unique national managed care company serving the group health, workers' compensation and state agency markets. Using technology to enable service and managed care innovations, First Health sets the bar for industry performance. For more information, visit the company website at www.firsthealth.com.