Aetna Announces New HSA-Compatible Health Plans for Small Employers in California; Three New Benefit Designs Supplement 'Pick-A-Plan' Portfolio.

WOODLAND HILLS, Calif. -- Aetna (NYSE:AET) announced today that it has begun offering three new high-deductible health plans, which are compatible with health savings accounts (HSAs) to employers with 2 to 50 employees in California. These plans supplement Aetna's existing Pick-A-Plan portfolio of products for small employers in the state. Pick-A-Plan currently includes one HSA-compatible plan option and provides employers the flexibility of offering their employees a choice of plan types.

"Aetna was one of the first health insurers to offer an HSA-compatible plan to small employers in California, and our experience has helped us develop these new plan options based upon the needs our customers

have expressed to us," said Chris Hakim, Aetna's general manager for small group products in California. "We believe that these new high-deductible health plans provide additional value, choice and flexibility for small business owners and their employees."

The new high-deductible plans were designed to minimize the out-of-pocket expenses to families in California. Most HSA-compatible plans on the market today require that a family reach the family deductible before the plan begins covering expenses. With Aetna's new plans, as soon as one member of the family meets the individual deductible that family member begins having their expenses covered by the plan, which significantly lowers the whole family's out-of-pocket expenses.

"Aetna uniquely understands the dual benefits of HSAs for employers and employees and designed their plans to benefit both constituents. Employers save with lower premiums and employees benefit by having a smoother transition from HMO or low-deductible plans to HSA-qualifying plans, said Roy S. Lyons, Senior Vice President, Marsh Affinity Group Services."

"Employers need to understand exactly how a high-deductible plan works in order to purchase the right plan for their employees. Benefits on a spreadsheet do not always tell the whole story, so in addition to the plan's benefits, an employer should make sure they know how much their employees will need to pay up front before the plan begins to pay benefits," Hakim said.

The addition of these three new plans brings the number of options in the Pick-A-Plan suite of products to 16. Employers with between four and 50 employees enrolling can decide to offer their employees as few or as many of the 16 plan design options as they wish. The Pick-A-Plan suite of products includes five HMO (health maintenance organization), one EPO (exclusive provider organization) and 10 PPO (preferred provider organization) -based plan designs. In California, HMO products are offered by Aetna Health of California and EPO and PPO products are offered by Aetna Life Insurance Company

As one of the nation's leading providers of health care, dental, pharmacy, group life, disability and long-term care benefits, Aetna puts information and helpful resources to work for its approximately 13.6 million medical members, 11.6 million dental members, 8.3 million pharmacy members and 13.3 million group insurance members to help them make better informed decisions about their health care and protect their finances against health-related risks. Aetna provides easy access to cost-effective health care through a nationwide network of more than 646,000 health care professionals, including over 385,000 primary care and specialist doctors and 3,908 hospitals. For more information, please visit www.aetna.com. (Figures as of September 30, 2004)