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© Hitesman & Wold, P.A. 2019 Cafeteria Plan Summary Description (3-11) 9 (1) Automatic Increase or Decrease for Insignificant Cost Changes. If the cost of coverage increases or decreases during a Plan Year by an insignificant amount, then your election to pay the cost of such coverage through the Cafeteria Plan shall be automatically increased or decreased to reflect such change in the cost. The Plan Administrator (in its sole discretion) will decide, in accordance with prevailing IRS guidance, whether increases or decreases in costs are "insignificant" based upon all the surrounding facts and circumstances (including, but not limited to, the dollar amount or percentage of the cost change). (2) Significant Cost Increases. If the Plan Administrator determines that the cost of coverage significantly increases during a Plan Year, you may either: (i) increase your election to pay the additional cost, (ii) enroll in another benefit package option providing similar coverage and change your election (if necessary) to pay the cost of that option through the Cafeteria Plan, or (iii) cancel the underlying coverage and revoke your election to pay the cost of that coverage through the Cafeteria Plan if no other benefit package option providing similar coverage is available. For example, if the cost of one option under the Group Medical Plan significantly increases during the Plan Year, you may increase your election to pay the increased cost or enroll in another option available under the Group Medical Plan and change your election to correspond to the new cost of Group Medical Plan coverage. If there is only one Group Medical Plan option, you may increase your election to pay the increased cost of that option or cancel Group Medical Plan coverage and revoke your election to pay for that coverage through the Cafeteria Plan. The Plan Administrator (in its sole discretion) will decide, in accordance with prevailing IRS guidance, whether a cost increase is significant and what constitutes "similar coverage" based upon all the surrounding facts and circumstances. (3) Significant Cost Decrease. If the Plan Administrator determines that the cost of coverage significantly decreases during a Plan Year: (i) you may enroll in the coverage and make or change your election to pay the cost of such coverage through the Cafeteria Plan; or (ii) if you are already enrolled in the underlying coverage and are paying the cost of such coverage through the Cafeteria Plan, the Plan Administrator will automatically decrease your election to pay the cost of such coverage in accordance with the cost decrease. For purposes of this rule, a change in cost allowing an election change can result from action taken by you (e.g., switching between full-time and part-time employment) or your Employer (e.g., changing the amount of Employer contribution toward the cost of coverage). (d) Change in Coverage. NOTE: This exception does not allow changes to your election under the Health Flexible Spending Account and the Limited Scope Health Flexible Spending Account. (1) Significant Curtailment. If the Plan Administrator determines your coverage, or the coverage of your spouse or dependent, is significantly curtailed during a Plan Year, you may enroll in another benefit package option providing similar coverage and make a corresponding election change to pay for that new coverage through the Cafeteria Plan. Coverage is "significantly curtailed" only if there is an overall reduction in coverage provided to participants under the plan so as to constitute reduced coverage to all participants in general (e.g., a significant increase in the deductible, copays, or out-of-pocket maximum applicable under