Retiree Dental Insurance Summary Plan Description J. C. Penney Corporation, Inc. January 1, 2015

Contents Dental SPD 1 Dental SPD Overview ....................................................................................... 1 Dental Benefits-At-a-Glance 2 Dental Benefits-At-a-Glance ............................................................................. 2 Aetna's Role 3 Aetna's Role as Claims Administrator/Insurer .................................................. 3 Eligibility 4 Retired Associate Eligibility ............................................................................... 4 Dependent Eligibility.......................................................................................... 4 Eligibility for an Incapacitated Child .................................................................. 5 Continuing Coverage 6 Introduction to Continuing Coverage ................................................................ 6 Disabled Associate Eligibility ............................................................................ 6 Surviving Spouse/DP Eligibility ......................................................................... 7 Enrolling for Benefits 8 Enrolling for Benefits Overview ......................................................................... 8 If You Don’t Enroll ............................................................................................. 9 Coverage 10 When Coverage Begins .................................................................................. 10 Changing Your Coverage ............................................................................... 10 Special Enrollment Rights ............................................................................... 12 When Coverage Ends ..................................................................................... 13 Benefits 15 Benefits Overview ........................................................................................... 15 Cost of Coverage ............................................................................................ 16 Comparing Your Options ................................................................................ 16 Dental Basic and Dental Plus ......................................................................... 17 Dental Maintenance Organization (DMO) ....................................................... 24 Plan Amendment or Termination 27 Plan Amendment or Termination .................................................................... 27 ERISA Disclosures About Your Benefits 28 Plan Name and Related Information ............................................................... 28 Plan Sponsor Information ............................................................................... 28 Participating Employers .................................................................................. 28 Plan Administrator ........................................................................................... 29

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2015 Retiree Dental Insurance SPD

Claims and Appeals 32 Filing Claims .................................................................................................... 32 Claims and Appeals Process .......................................................................... 32 Coordination of Benefits (COB) 40 Coordination of Benefits Overview.................................................................. 40 Coordination with Dental or Medical Plans ..................................................... 40 Determining Which Plan Is Primary ................................................................ 40 Coordination with Auto, Home Owners or Other Insurance ........................... 41 Coordination with Workers' Compensation ..................................................... 41 Children of Divorced or Separated Parents .................................................... 41 Subrogation 42 Reimbursement and Third-Party Recovery Provision..................................... 42 Your Agreement to Subrogation and Reimbursement .................................... 42 Limitation to the Plan's Subrogation and Reimbursement Rights .................. 43 Subrogation and Reimbursement Rights Not Affected by Payment ............... 43 Lien on Proceeds ............................................................................................ 43 Right to Receive and Release Necessary Information ................................... 44 Continuing Your Coverage under COBRA 45 Highlights......................................................................................................... 45 Qualifying Events ............................................................................................ 45 Losing Coverage ............................................................................................. 46 Qualified Beneficiaries .................................................................................... 46 Benefit Eligibility .............................................................................................. 47 COBRA Continuation Period ........................................................................... 47 Notice of Qualifying Event ............................................................................... 48 Notice of Second Qualifying Event ................................................................. 49 All Other Qualifying Events ............................................................................. 49 Returning the Election Form and Payment ..................................................... 49 What Else You Should Know .......................................................................... 49 Domestic Partners and COBRA Benefits........................................................ 50 If You Have Questions .................................................................................... 50 Address Changes............................................................................................ 50 Qualified Medical Child Support Orders (QMCSO) 52 About QMCSOs .............................................................................................. 52 Notice of Privacy Rights 53 The Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rules .................................................................................................. 53

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2015 Retiree Dental Insurance SPD

ERISA Rights Statement 59 The Employee Retirement Income Security Act of 1974 (ERISA).................. 59 Key Terms 61 Key Terms ....................................................................................................... 61

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2015 Retiree Dental Insurance SPD

Dental SPD Dental SPD Overview You may choose from up to three options available through Aetna, depending on where you live: 

Dental Basic



Dental Plus



Dental Maintenance Organization (DMO) — not available in Puerto Rico

Each option provides preventive and basic services through a Dental Network. They differ in the amount of eligible expenses they cover and how service is provided. This SPD is intended to provide highlights of the Plan. It does not replace or supplement the state DMO policies or certificates. Aetna is the Insurer for the DMO option.

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2015 Retiree Dental Insurance SPD

Dental Benefits-At-a-Glance Dental Benefits-At-a-Glance Option

Eligibility

Dental Basic

All Retirees who are eligible for Retiree Benefits and their eligible Dependents

Coverage Levels 

Retiree Only



Retiree + Spouse/DP



Dental Plus All Retirees who are eligible for Retiree Benefits and their eligible Dependents

Key Features 

Preventive Care is covered at 100% with no Deductible



Retiree +

Basic Care is covered at 70% after Deductible

Child(ren)



Major Care is not covered



Retiree + Family



Orthodontia is not covered



Retiree Only



Preventive Care is covered at



Retiree + Spouse/DP





Retiree + Child(ren)



100% with no Deductible Basic Care is covered at 80% after Deductible 

Retiree + Family

Major Care is covered at 50% after Deductible



Orthodontia is covered at 50%

DMO (available in some areas)

All Retirees who are eligible for Retiree Benefits and their eligible Dependents (except those in Puerto Rico) if your home or work ZIP code is in the Network



Retiree Only



No Deductible



Retiree +



Preventive Care is covered at

Spouse/DP 

Retiree +

100% 

Child(ren) 

Retiree + Family

Basic Care is covered at 100%



Major Care is covered at 50%



Orthodontia is covered at 50% only for your covered children when treatment begins before age 19



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Primary Care Dentist required

2015 Retiree Dental Insurance SPD

Aetna's Role Aetna's Role as Claims Administrator/Insurer The Dental benefits are administered by Aetna Life Insurance Company (Aetna). Aetna is the claims administrator and named fiduciary for benefit claims under the Dental Basic and Dental Plus options and the Insurer for the DMO option. You may contact Aetna at 1-866-276-4916 or www.aetnajcpenney.com for more information, to request a free copy of the policy for the DMO option, including a detailed list of what's covered, limitations and exclusions and claims and appeals procedures, or to find out how a specific benefit works. The following information is intended to be a summary of your benefits and may not include all plan or policy provisions, limitations and exclusions. If there is a difference or inconsistency between this summary and the plan(s) established by the Company or policy(ies) issued by Aetna, the terms of the applicable plan or policy will govern. You may obtain a copy of the plan(s) from the Company. You may obtain a copy of the policy(ies) by contacting Aetna. The Company reserves the right to amend or terminate any of its benefit plans at any time.

The following information is intended to be a summary of your benefits as of January 1, 2015 and does not include all plan or policy provisions, limitations and exclusions. If there is a discrepancy between this summary and the plan(s) or policy(ies) issued by the Company or the Insurer, the terms of the plan(s) or policy(ies) will govern. You may obtain copies of the plans from the Company. You may obtain copies of the policies by contacting PowerLine. The Company reserves the right to terminate or amend its benefit plans at any time.

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2015 Retiree Dental Insurance SPD

Eligibility Retired Associate Eligibility When your coverage ends, you may be eligible to enroll as a Retired Associate. You are eligible for Retiree Dental coverage as a Retired Associate if you were hired or rehired before January 1, 2002, and on the date your employment ends (unless due to a summary dismissal or resignation in lieu thereof): 

You are at least age 55;



You are eligible for Retiree Benefits and a Participant in the Dental option;



You have completed at least 10 years of total service, with five consecutive years immediately before your employment ends; and



Your age plus your total years of service is equal to 80 or more (unless you are disabled).

Note: If you were a participant in the Voluntary Early Retirement Program (VERP) under the J. C. Penney Corporation, Inc. Pension Plan and in connection with the VERP you separated from service with the Company between October 1, 2011 and September 30, 2012, you will be credited with up to five years of additional age and up to three years of additional service credit for purposes of determining if you are eligible for retiree benefits under the option. If you do not enroll when you are first eligible, you may not be able to participate in the future. Please see the Enrolling for Benefits Overview section. No Associate hired or rehired on or after January 1, 2002, is eligible to continue Retiree Dental coverage as a Retired Associate, other than by electing to continue Retiree Dental coverage under COBRA, unless the Associate was eligible to continue Retiree Dental coverage as a Retired Associate prior to the date of rehire.

Dependent Eligibility Dental coverage is also available for your eligible Dependents. Eligible Dependents include: 

Spouse



Domestic Partner (DP)



Child

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2015 Retiree Dental Insurance SPD

A Child includes a person who meets the definition of Child under Dependent in the Key Terms section of this SPD. A Child will also include a person under the Retiree Dental option's age limit for whom you are required to provide health care coverage. See the Qualified Medical Child Support Orders (QMCSO) section of this SPD for further information. Legal documentation may be required to prove the eligibility of your Dependents. Benefits will be suspended if documentation is not produced within a reasonable time after a request is made. Your Dependent is not eligible if he or she: 

Is covered as an Associate. An Associate may be covered either as an Associate or a Dependent, but not both, under the Retiree Dental coverage option.



Does not meet the definition of Spouse/DP or Child under the Retiree Dental option.



Is covered as the Dependent of another Associate. Double coverage is not allowed under the Retiree Dental option.

Eligibility for an Incapacitated Child You may continue coverage for an Incapacitated Child who is incapable of self-support and would lose coverage due to age as long as you are also covered under the Retiree Dental option. To continue coverage, you must apply no later than the last day of the month in which the child turns age 26 even if the child is already enrolled. If you want to enroll an Incapacitated Child, you may apply for coverage by completing a Continuation of Coverage for Incapacitated Children form. The form must be approved before coverage is effective. You can obtain this form through PowerLine. From time to time you will also be asked to provide proof that your child is, or continues to be, incapacitated. If you don't timely respond to a request for proof that your child is or remains incapacitated, the child's coverage will be terminated.

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2015 Retiree Dental Insurance SPD

Continuing Coverage Introduction to Continuing Coverage In certain situations, you and/or your eligible Dependents may be able to continue coverage after your coverage would normally end.

Disabled Associate Eligibility If coverage ends due to disability and you are no longer employed, you may be eligible for coverage due to disability. If you were hired or rehired before January 1, 2002, and you are determined to be Social Security Disabled, you are eligible for Retiree Dental coverage if, on the date your employment ends: 

Your disability that began while you were employed by the Company is that same disability that qualifies you for Social Security Disability benefits;



You are eligible for Retiree Benefits and a Participant in Dental coverage; and



You have completed at least 10 years of total service, with five consecutive years immediately before your employment ends.

Note: If you were a participant in the Voluntary Early Retirement Program (VERP) under the J. C. Penney Corporation, Inc. Pension Plan and in connection with the VERP you separated from service with the Company between October 1, 2011 and September 30, 2012, you will be credited with up to five years of additional age and up to three years of additional service credit for purposes of determining if you are eligible for retiree benefits under the option. If you do not enroll when you are first eligible, you may not be able to participate in the future. Please see the Enrolling for Benefits Overview section. If your employment ends before you receive your Social Security Disability Award: 

To continue your Retiree Dental coverage while your application for Social Security Disability benefits is pending, you must continue coverage under COBRA if you are not eligible and enrolled as a disabled Associate.



When you receive your Social Security Disability Award, you must send your complete award to the Recovery Assistance Center (RAC) administered by Liberty Life Assurance Company of Boston (Liberty Mutual) within 60 days of receipt. If you are eligible, PowerLine will enroll you in Retiree Dental as a disabled Associate effective the first of the month after receiving your complete Social Security Disability Award.

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2015 Retiree Dental Insurance SPD

Mailing Address: Recovery Assistance Center (RAC) P.O. Box 7210 London, KY 40742-9949 Fax: (603) 334-0366 No Associate hired on or after January 1, 2002 is eligible for coverage under the Retiree Dental option as a disabled Associate unless the Associate was eligible for coverage as a Retired Associate when first retired.

Surviving Spouse/DP Eligibility If you die before you retire and you were hired or rehired before January 1, 2002, your Spouse/DP and children are eligible for Medical and/or Dental coverage as a surviving Spouse/DP, if on the date of your death: 

You have completed at least 10 years of total service, with five consecutive years immediately before your employment ends; and



You are eligible for Retiree Benefits and are covered by the Retiree Dental option.

Note: If you were a participant in the Voluntary Early Retirement Program (VERP) under the J. C. Penney Corporation, Inc. Pension Plan and in connection with the VERP you separated from service with the Company between October 1, 2011 and September 30, 2012, you will be credited with up to five years of additional age and up to three years of additional service credit for purposes of determining if you are eligible for retiree benefits under the option. Children must be enrolled in the same option as the Spouse/DP. If your Dependents do not enroll when you are first eligible, they may not be able to participate in the future. Please see the Enrolling for Benefits Overview section. A surviving Spouse/DP of any Associate hired on or after January 1, 2002 will no longer qualify for coverage under the Retiree Dental option.

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2015 Retiree Dental Insurance SPD

Enrolling for Benefits Enrolling for Benefits Overview Your active Retiree Dental coverage ends on the last day of the month that your employment ends. You have two options to continue coverage: 

Enroll for coverage as a Retired Associate, Disabled Associate, or Surviving Spouse/DP; or



Elect to continue coverage under COBRA.

Retiree Enrollment Options 

You and your covered Dependents (including any Incapacitated Children) are automatically enrolled in the same Dental option if you were a Participant on the date your employment ended, and you satisfy the Retiree Dental eligibility requirements for participation. You do not have to enroll in Retiree Medical to have Retiree Dental coverage.



You may drop your automatic enrollment coverage for yourself and/or your Dependents.*

* Once coverage is dropped, you may not reenroll yourself and your eligible Dependents in the Dental option at a later date unless you can provide proof of continuous Creditable Coverage for you and your eligible Dependents, as applicable, from the date you dropped coverage until the date you reenroll.

COBRA Enrollment Options 

You may elect to continue coverage under COBRA for 18 months under the same Retiree Dental option.



Your Dependents who are qualified beneficiaries may elect to continue coverage under COBRA (or COBRA-like benefits with respect to a DP or a DP's Dependents) for up to 36 months, depending on your specific circumstances, under the same Retiree Dental option.

If COBRA coverage is elected, you and/or your Dependents who elect COBRA coverage cannot enroll in Retiree Dental coverage as a Retired Associate or a Retired Associate's Dependent at any later date.

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2015 Retiree Dental Insurance SPD

If you want to make changes to your automatic enrollment Retiree Health & Welfare Enrollment material will be mailed to you from PowerLine once your employment ends. If you take no action, you will have Retiree coverage as indicated in the Your Coverage section of the material. If you want to make changes, you must do so within 30 days of the later of the coverage effective date or the statement date listed on the Enrollment Worksheet. To make changes, log on to PowerLine from the Associate Kiosk, the Associate Kiosk@Home (accessible via www.jcpassociates.com) or www.JCPenneypowerline.com or call PowerLine at 1-888-890-8900 and listen to the menu prompts. It is your responsibility to compare your online or printed enrollment information to your "Completed Successfully" page or your confirmation of enrollment to be sure it is correct. You have 30 days from receipt of either of these statements to call PowerLine about any errors. If you elect to continue coverage through COBRA, your automatic enrollment in Retiree Dental will be cancelled by PowerLine.

If You Don’t Enroll If you don’t enroll as a Retired Associate, Disabled Associate, or Surviving Spouse/DP when first eligible or you drop your coverage, you may enroll or reenroll in the Retiree Dental option in the future if you have proof of continuous Creditable Coverage from the date you dropped coverage until the date you enroll or reenroll and you enroll or reenroll as of the earlier of: 

The next Annual Enrollment;



Your or your Spouse's, Domestic Partner's or Child's experiencing a qualified change in status or life event; or



You or your Spouse's, Domestic Partner's, or Child's qualifying for a Special Enrollment Right.

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2015 Retiree Dental Insurance SPD

Coverage When Coverage Begins After you enroll, coverage is effective on: 

Retiree — the first of the month after your retirement date;



Disabled Associate — the first of the month after PowerLine receives our complete Social Security Disability Award;



Surviving Spouse/DP — the first of the month following the date the Employee was terminated due to death;



The Annual Enrollment effective date; or



The first day of the month in which your qualified change in status or Special Enrollment Right, such as marriage or birth of a child, etc. is effective. (See the Special Enrollment Rights section for more information.)

Changing Your Coverage In order to change your coverage levels within a plan year, you must notify PowerLine within 60 days of when you experience a qualified change in status. Proof of the change in status may be required. Any change in coverage must be consistent with your qualified change in status. Changes in status include, but are not limited to: If You...

What Happens to Your Dental Coverage

Get married/form a partnership

You may enroll, add, change options or drop coverage for yourself and/or your new Dependents.

Have a Spouse/DP who loses benefits coverage

You may enroll, add, change options or drop coverage for yourself and/or your new Dependents.

Get divorced/separated/annulment/ terminate a partnership

You may enroll, drop, or change coverage options for yourself and your children. Spouse/DP coverage ends on the last day of the month in which the divorce or legal separation occurs or partnership ends, unless otherwise required by state law. A Qualified Medical Child Support Order (QMCSO) may require you or your Spouse to cover your children. See the Qualified Medical Child Support Orders (QMCSO) section of this SPD for more information.

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2015 Retiree Dental Insurance SPD

If You...

What Happens to Your Dental Coverage

Have or adopt a child

You may enroll, add, change options or drop coverage for yourself and/or your new Dependents.

Have a child who loses eligibility

Child coverage ends on the last day of the later of the month (i) in which he or she reaches age 26, or (ii) is no longer incapacitated.

Are rehired and regain eligibility for You must drop Retiree or Disabled Associate coverage and Plus Benefits after retiring reenroll in active coverage. When you again retire you will be eligible for Retiree Dental if you were a participant in the active Dental option on the date your employment ends again or you can provide proof of other Creditable Coverage from the time you were first eligible to enroll in Retiree Dental or from the time your Retiree Dental coverage ended due to gaining eligibility for Plus Benefits until the time you again retire, unless you are terminated due to a reason constituting summary dismissal or resignation in lieu of a summary dismissal. Become covered by another group health plan

If you were enrolled in Retiree or Disabled Associate coverage, you may drop Dental coverage. If you drop coverage, you may later reenroll for Retiree coverage, if eligible, by providing proof of continuous Creditable Coverage from the date you dropped coverage until the date you reenroll.

Experience the death of a child

You must call PowerLine to drop child coverage unless you have other children covered.

Experience the death of your Spouse/DP

You must call and drop coverage for your Spouse/DP. You and your children may continue coverage or enroll with proof continuous Creditable Coverage as long as they remain eligible and continue the required premium payments.

Die

If you die before you retire, see “Surviving Spouse/DP Eligibility” in the Continuing Coverage section of this SPD. If you were covered as a Retiree, your Spouse/DP and children may enroll in or continue coverage as long as they remain eligible and continue the required premium payments. If your surviving Spouse/DP is an active Associate who is eligible for Plus Benefits and covered under the Dental option as a Dependent of a Retiree, he or she must enroll as an active Associate to continue coverage, along with any covered children. If your surviving Spouse/DP loses coverage, he or she may reenroll as your surviving Spouse/DP. For more information, see “Surviving Spouse/DP Eligibility” in the Continuing Coverage section of this SPD.

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2015 Retiree Dental Insurance SPD

If You...

What Happens to Your Dental Coverage Dependent children can be covered only if your surviving Spouse/DP is covered under the Plan. If you have no surviving Spouse/DP or your Spouse/DP does not enroll for coverage as a surviving Spouse/DP, your eligible children may continue their coverage under COBRA. Your surviving Spouse/DP may continue coverage if he or she remarries or forms a partnership, but may not enroll a new Spouse/DP or new children. Your surviving Spouse/DP and any eligible children must show proof of continuous coverage from the date of your retirement through the date of your death under the JCPenney Dental option or other continuous Creditable Coverage. If your surviving Spouse/DP and children don't elect coverage within 60 days of the date of your death, they can not enroll in the Dental option later.

Special Enrollment Rights If you are declining enrollment for yourself or your Dependents, including your Spouse/DP because you have coverage under another health insurance or group health plan, you may be able to enroll yourself and your Dependents in this Plan if: 1. You declined coverage under this Plan when you were first eligible to enroll due to having other coverage, if required. 2. You and your eligible Dependents did not enroll in the above options when first eligible because you had other Creditable Coverage, and you then lose your other Creditable Coverage as a result of: 

Loss of eligibility due to legal separation, termination of partnership, divorce, death, cessation of Dependent status, termination of employment or termination of the other plan's coverage or the other plan's ceasing to provide coverage to a class of similarly situated individuals;



You no longer live or work in a DMO or HMO service area, as applicable;



Your COBRA coverage under another employer's group health plan is exhausted and does not end as a result of your ceasing to pay the applicable COBRA premium;



Your claims meet or exceed a lifetime maximum on benefits under other coverage; or



The other employer stops making or decreases contributions for your coverage; however, if the other employer is subsidizing the cost of your COBRA coverage and the employer ceases or reduces the subsidy, you will not qualify for a Special Enrollment Right until your COBRA coverage is exhausted and does not end as a result of your ceasing to pay the applicable COBRA premium.

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2015 Retiree Dental Insurance SPD

3. You request enrollment no later than 60 days after your or your Dependents' other coverage ends (or after the employer stops contributing toward the cost of the other coverage) as described. In addition, with respect to the Medical option, you may enroll your Spouse or Dependent Child within 60 days after the qualifying event (court order or lose of coverage) under the following circumstances: 

A court order requires you to enroll your Spouse; or



Your Dependent Child lost coverage under Medicaid (other than coverage solely in connection with the administration of pediatric vaccines) or the State Children's Health Insurance Program (SCHIP)

If you have a new Dependent as a result of marriage, addition of a DP, birth, adoption, placement for adoption or Qualified Medical Child Support Order (QMCSO), you may be able to enroll yourself and your Dependents. However, you must request enrollment no later than 60 days after receipt of the order by your employer or the marriage, birth, adoption, or placement for adoption. To enroll, call PowerLine at 1-888-890-8900.

When Coverage Ends Generally, coverage ends on the last day of the month after: 

You or your Dependent(s) lose eligibility;



The policy ends or is cancelled and is not replaced;



Premiums are not paid;



You cancel coverage, if allowed;



You or your Dependent(s) die;



You cancel coverage for your Dependent(s);



The benefit or policy is no longer offered by your Participating Employer;



For anyone that you fail to properly verify as your Dependent through the Dependent Verification Process;



The Plan is terminated or amended to end coverage for a group or class that includes you or your Dependent(s); or

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2015 Retiree Dental Insurance SPD



You make a misrepresentation or fraudulent claim for benefits.

If your coverage ends, you and your covered Dependent(s) may be eligible to continue coverage under COBRA. COBRA allows you and/or your eligible Dependent(s) to continue your current coverage under the Retiree Dental option if your coverage ends for a reason specified in the regulations. COBRA qualifying events are events that can cause a loss of coverage. These events include: 

The Company or a Participating Employer files for Chapter 11 bankruptcy.



Divorce, legal separation, annulment or termination of partner status (including contemplation of divorce, legal separation, annulment or termination of partner status).



Your Dependent loses eligibility.



Your death.

See the Continuing Your Coverage Under COBRA section of this SPD for more information. What happens if I am enrolled in the DMO option and I am in the middle of treatment when my coverage ends? Most services are not covered after your coverage ends. Some supplies and services are covered if they are ordered by the dentist before coverage ends and are installed or delivered no later than 30 days after coverage ends. Some examples are: 

Inlays or onlays;



Crowns;



Removable or fixed bridgework;



Cast or processed restorations;



Dentures; and



Root canals.

For more information about how your coverage would work in these situations, contact Aetna at 1-866-276-4916.

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2015 Retiree Dental Insurance SPD

Benefits Benefits Overview JCPenney offers three Dental options — Dental Basic, Dental Plus and a DMO. You choose the option that best suits your needs. Dental insurance helps with dental expenses and coordinates with your Medical Plan coverage on some benefits. Aetna is the named administrator for benefit claims processing for the Dental Basic and Dental Plus options and the Insurer for the DMO option. Aetna provides Retired Associates access to a large national Network of dentists that have agreed to provide services at reduced rates. When you use a Network provider, you save money. Quick Tip: Use Network Dentists To Save Money You can use DocFind, Aetna's online provider directory, on the Aetna website via PowerLine to find a dentist in your area. To receive a free list of Network providers for the Dental Basic, Dental Plus or DMO options, contact Aetna at 1-866-276-4916.

Option

Eligibility

Key Features

Dental Basic

All Retirees who are eligible for Retiree Benefits and their eligible Dependents.



Preventive Care is covered at 100% with no Deductible



Basic Care is covered at 70% after Deductible

Dental Plus

All Retirees who are eligible for Retiree Benefits and their eligible Dependents.



Major Care is not covered



Orthodontia is not covered



Preventive Care is covered at 100% with no Deductible



Basic Care is covered at 80% after Deductible



Major Care is covered at 50% after Deductible

DMO (available in

JCPenney

All Retirees who are eligible

15



Orthodontia is covered at 50%



No Deductible

2015 Retiree Dental Insurance SPD

Option

Eligibility

Key Features

some areas)

for Retiree Benefits and their eligible Dependents (except those in Puerto Rico) if your home or work ZIP code is in the Network.



Preventive Care is covered at 100%



Basic Care is covered at 100%



Major Care is covered at 50%



Orthodontia is covered at 50% only for your covered children when treatment begins before age 19



Primary Care Dentist required

Cost of Coverage The cost for Dental coverage is based on the option and coverage level you select. You pay the cost of your (and your eligible Dependents') Dental benefits on an after-tax basis through direct billing. It is your responsibility to remit the amount billed so that it is received by the due date shown on the billing statement. If PowerLine does not receive your payment by the due date, coverage will be canceled as of the last day of the month for which a full month's premium was received. Once coverage is cancelled for nonpayment, it cannot be reinstated. PowerLine will bill you monthly for your dental coverage. You can request that the cost of your coverage be deducted from your monthly pension check or direct debited from your checking or savings account each month. You may also call PowerLine to request a quarterly, semi-annual or annual payment option. In addition to your premiums, you may be responsible for paying Deductibles and Coinsurance depending on the option you elect. For more cost or coverage information, log on to PowerLine via the Associate Kiosk.

Comparing Your Options Review the following chart to compare general information about the Dental options available to you. Plan Feature

Dental Basic*

Dental Plus*

DMO

Per person

$50

$50

None

Family

$150

$150

None

Annual Deductible

The Plan pays up to the amount noted below for covered expenses: Annual Maximum Benefit per person (for all

JCPenney

$1,000

$2,000

16

None (does not include orthodontia)

2015 Retiree Dental Insurance SPD

Plan Feature

Dental Basic*

Dental Plus*

DMO

Preventive Care Oral exams, cleanings, X-rays**, etc.

100% (no Deductible)

100% (no Deductible)

100%

Basic Care Fillings, extractions, sealants, etc.

70% after Deductible

80% after Deductible

100%

Major Care Bridgework, crowns, inlays, etc.

Not covered

50% after Deductible

50%

Special Services Realignment of teeth due to tumors, cysts, accidental injury or birth defects

Not covered

Not covered

Not covered

Orthodontia Braces, retainers, etc.

Not covered

50% (no Deductible)

50% (no Deductible) (for covered Dependent children when treatment begins before age 19)

Lifetime Maximum Orthodontia benefit (per person)

Not applicable

$2,000 per lifetime

One complete course of Treatment per lifetime

Prescription Drugs

Not covered

Not covered

Not covered

services combined except when noted)

* The amount paid is subject to Reasonable and Customary (R&C) limits. ** Certain X-rays are subject to plan limits. Please contact Aetna for more information.

Dental Basic and Dental Plus The Dental Basic and Dental Plus options are dental Preferred Provider Organizations (PPOs). When you use a PPO, you can see any dentist you choose. However, there is a Network of dentists who agree to provide services to PPO members for a discounted rate. Dentists who are not in the Network may charge more than Network dentists and may not file a claim for you. In most cases, your expenses will be lower if you use a Network Provider. The Dental Basic and Dental Plus options only pay for services up to the Reasonable and Customary (R&C) limit. Dentists in the Network have agreed to charge fees that are within the R&C limit. If you elect to receive services from a non-Network Provider, you will be responsible for any charges in excess of R&C.

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2015 Retiree Dental Insurance SPD

Paying for Dental Expenses In addition to the monthly premium, which is based on the option and the coverage level you select, you must pay a Deductible and Coinsurance on eligible Basic Care, Major Care and Orthodontia for the Dental Plus option. You must pay a Deductible and Coinsurance on eligible Basic Services for the Dental Basic option. Deductible Your Deductible is an amount you pay once a year before your Coinsurance begins. There is an individual Deductible ($50) and a family Deductible ($150). The family Deductible is met when eligible expenses for you and/or any covered Dependent reach the family Deductible amount. Each family member can only contribute the individual Deductible amount, $50, toward the family Deductible. Example: You are enrolled in the Dental Basic option and get a filling in-network that costs $200. Here's how it works: 

You would pay your $50 Deductible and there would be a balance of $150



Then, the Plan's Coinsurance would kick in and the Plan would pay $105 (70% Coinsurance of $150) and you would pay the remaining $45 (30% Coinsurance of $150)



You would pay a total of $95 ($50 Deductible + $45 Coinsurance)

Since you have now met your Deductible, you would pay only Coinsurance for the rest of the year. For example, if you had another filling that costs $175 later in the year: 

The Plan would pay $122.50 (70% Coinsurance)



You would pay $52.50 (30% Coinsurance)

The following expenses do not count toward your Deductible: 

Amounts above the level considered R&C (only applies if you receive services out-of-network);



Services not covered by the Dental option;



Prescription drugs purchased under the Prescription Drug Program (see the Medical SPD for further information); and



Charges above the maximum benefit provided for that type of service.

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2015 Retiree Dental Insurance SPD

Annual Maximum The maximum benefit that you and each of your covered Dependents may receive during a calendar year is: 

For the Dental Basic option: $1,000



For the Dental Plus option: $2,000

This maximum includes all covered services (except for orthodontia, which is covered under the Dental Plus option but not under the Dental Basic option). These non-orthodontia covered services include: 

For the Dental Basic option: services for Preventive Care and Basic Care.



For the Dental Plus option: services for Preventive Care, Basic Care and Major Care.

Example: You are enrolled in the Dental Basic option and get some fillings and have other teeth pulled that, innetwork, costs a total of $1,900. Here's how the annual maximum would work: 

You pay your Deductible of $50 leaving a balance of $1,850



The Plan's Coinsurance kicks in and the Plan pays $1,000 toward the balance even though the 70% Coinsurance would equal $1,295 (70% of $1,850). That's because the annual maximum is $1,000



You would be responsible for your Coinsurance amount of $555 (30% of $1,850) plus the $295 over the $1,000 annual maximum



You would pay a total of $900 ($50 Deductible + $295 in excess of annual maximum and your Coinsurance of $555)

Lifetime Maximum The Dental Plus option has a lifetime maximum for orthodontia of $2,000 per person. Emergency Care With the Dental Basic or Dental Plus option, you can use any dentist at any time. If you have an emergency, your services will be paid the same way they would be paid in any other situation. If you must receive emergency care from a non-Network provider, treatment will be covered up to the lesser of the R&C limits or the actual charges.

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2015 Retiree Dental Insurance SPD

Rules and Limitations under the Dental Basic and Dental Plus Options The services listed in this section are the only services eligible for reimbursement under the Dental Basic and Dental Plus options. 

If your dental provider recommends a procedure and you are unsure if it is a covered service, you or your dental provider should request a Pre-Treatment Estimate before beginning treatment.



If two or more of the covered services listed will produce a professionally adequate result for a specific condition, the least expensive service will be considered the covered service.

Preventive Care

Dental Basic

Dental Plus

Plan Pays

100%*

100%*

Annual Deductible

Does not apply

Does not apply

Annual Maximum Benefit**

$1,000 per person

$2,000 per person

Lifetime Maximum Benefit

Does not apply

Does not apply

* The amount paid is subject to Reasonable and Customary (R&C) limits. ** Preventive Care, Basic Care, Major Care, Special Services and Prescription Drug amounts (if covered) are combined.



Oral examination (limited to two times per plan year including exams performed as a part of a procedure other than just for Preventive Care).



Complete X-ray series, including bitewings, if necessary, or panoramic film (limited to one set every three rolling years).



Bitewing X-rays (limited to two sets per plan year).



Vertical bitewing X-rays (limited to one set every three rolling years).



Cleaning (dental prophylaxis) — two cleanings per plan year. 

One additional cleaning allowed per year for cases involving diabetes, maternity or cardiac conditions.



Periodontal maintenance prophylaxis — two cleanings per plan year.



Space maintainers (includes all adjustments within six months of installation): 

Fixed, band type.



Removable acrylic with round wire clasp.



Removable appliance to correct habits.



Fixed or cemented appliance to correct habits.



Topical fluoride treatments for children through age 16 (limited to two times per plan year).



Oral hygiene instruction.



Sealants for children through age 16.



Individual periapical X-rays.

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2015 Retiree Dental Insurance SPD

Basic Care

Dental Basic

Dental Plus

Plan Pays

70%*

80%*

Annual Deductible

$50 per individual, $150 per family

$50 per individual, $150 per family

Annual Maximum Benefit**

$1,000 per person

$2,000 per person

Lifetime Maximum Benefit

Does not apply

Does not apply

* The amount paid is subject to Reasonable and Customary (R&C) limits. ** Preventive Care, Basic Care, Major Care, Special Services and Prescription Drug amounts (if covered) are combined.



Occlusal X-rays.



Extra-oral X-rays.



Biopsy and examination of oral tissue.



Pain relief (palliative treatment), paid as a separate benefit only if no other services are rendered during the visit, except X-rays.



Therapeutic drug injections.

Basic Restorative Treatment Multiple restorations on a single surface will be considered as a single surface restoration. 

Diagnostic casts.



Amalgam restorations (fillings).



Pin retention, covered only with an amalgam or composite restoration (filling build-up).



Composite and resin restorations (fillings), covered only for anterior teeth and non-stress-bearing areas of bicuspid teeth.



Crown build-up, repair or recementing of crowns, inlays, onlays, bridgework or dentures.

Basic Periodontic Treatment 

Scaling and root planing (limited to four separate quadrants once every 18 months).



Occlusal guard (night guard) appliances (limited to one appliance every 24 months).

Basic Endodontic Treatment 

Pulpotomy.



Root canal therapy.



Apicoectomy and retrograde filling (only if performed more than one year after the root canal therapy is completed).



Hemisection (tooth preservation).

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2015 Retiree Dental Insurance SPD

Basic Oral Surgery 

Simple extraction.



Surgical extraction of erupted or impacted tooth.



Root recovery.



Incision and drainage of abscesses.



Laboratory and pathology reports associated with oral surgery.

Major Care (Covered Only under Dental Plus option)

Dental Basic

Dental Plus

Plan Pays

Not covered

50%*

Annual Deductible

Does not apply

$50 per individual, $150 per family

Annual Maximum Benefit**

Does not apply

$2,000 per person

Lifetime Maximum Benefit

Does not apply

Does not apply

* The amount paid is subject to Reasonable and Customary (R&C) limits. ** Preventive Care, Basic Care, Major Care, Special Services and Prescription Drug amounts (if covered) are combined.

Major Restorative Treatment — Inlays, Onlays and Crowns Benefits for the final appliance or restoration include temporary restorations and up to one year of followup care. 

Initial placement of inlays, onlays and crowns only for extensive decay, fracture or non-cosmetic defect, and only when the tooth cannot be restored with a filling.



Replacement of inlays, onlays and crowns. (Replacement of inlays, onlays, and crowns is covered only if at least five years have elapsed since the last placement. However, the five-year rule does not apply to replacements resulting from a traumatic accidental injury due to an external force or blow.)



Post and core for endodontically-treated teeth that require a crown.

Major Prosthodontics Treatment — Dentures and Bridges The initial placement of bridges and dentures is covered if the Participant is enrolled in the Dental Plan at the time the teeth are extracted. Replacement of bridges and dentures is covered if at least five years have elapsed since the last placement, and the bridges and dentures cannot be repaired or restored to function. If the replacement of bridges and dentures results from the extraction of a functioning natural tooth, the five-year rule will be waived.

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2015 Retiree Dental Insurance SPD

Normally, dentures will be replaced with other dentures. If a professionally satisfactory result can be achieved only with fixed bridgework, however, the fixed bridgework will be considered a covered expense. 

Full dentures. (No benefits will be paid for overdentures and associated procedures, customized and duplicated dentures, or specialized techniques.)



Partial dentures, including all clasps, rests, and teeth. (No benefits will be paid for precision or semiprecision attachments.)



Fixed and Maryland bridges.



Denture adjustments, rebases and relining — covered only if performed more than six months after initial placement of dentures.

Major Oral Surgery 

Surgical exposure of impacted or unerupted tooth to aid eruption.



Surgical periodontic treatment, gingivectomy, gingival curettage, mucogingival surgery, osseous surgery, osseous grafts, pedicle grafts and free soft tissue grafts (limited to one of these surgical procedures in each quadrant every 36 months).



Alveoplasty (recontouring/reshaping the upper or lower jawbone, usually in the preparation for full or partial dentures).



Vestibuloplasty (increasing the upper or lower jawbone height, usually in preparation for full or partial dentures).



Removal of exostosis (bony overgrowth projecting from the normal contours of the jawbone).



Frenectomy/frenulectomy (removal/reshaping soft tissues attaching the cheeks and lips to soft tissues of the upper or lower jawbone).



Excision of hyperplastic tissue (removing overgrowths or enlargements of normal tissue).



Excision of periocoronal tissue (removing thick gum tissue around the crown of an emerging tooth).

Anesthesia General anesthesia or intravenous (I.V.) sedation is covered (and reimbursed at the Major Services level) only if it is medically necessary and required for extraction of impacted teeth, root recovery, incision and drainage, stomatoplasty/vestibuloplasty, removal of exostosis, or periodontal osseous surgery. A provider with approved anesthesiology qualifications must administer anesthesia. Orthodontia (Covered Only under Dental Plus option)

Dental Plus

Percentage Covered

50%*

Annual Deductible

Does not apply

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2015 Retiree Dental Insurance SPD

Orthodontia (Covered Only under Dental Plus option)

Dental Plus

Annual Maximum Benefit

Does not apply

Lifetime Maximum Benefit

$2,000 per person

* The amount paid is subject to Reasonable and Customary (R&C) limits.

Coverage for orthodontia is available under the Dental Plus option. Orthodontia is not covered under the Dental Basic option. Orthodontia is the corrective movement of teeth by means of an appliance, such as braces, expanders or retainers, to correct malposition (faulty position) or malocclusion (abnormal bite). Aetna determines if malposition or a malocclusion exists. It is recommended that you or your orthodontist request a PreTreatment Estimate before treatment begins. The Dental Plus option will only cover the following conditions: 

Vertical or horizontal overlap of upper teeth over lower teeth (overbite or overjet);



Faulty alignment (either frontwards or backward) of the upper and lower arches with each other; and



Cross-bite.

Prescription Drugs Medications used for dental treatment are part of the prescription drug services covered under the Medical Plan's Prescription Drug Program. See your Medical SPD for details on prescription drug coverage under the Prescription Drug Program. (If you are enrolled in an HMO in Puerto Rico, your prescription drug coverage remains with your HMO.)

Dental Maintenance Organization (DMO) The DMO is a dental maintenance organization. When you choose this option, you can only use dentists in the DMO Network. Dental care is not covered when you use a non-Network dentist, except in certain emergency situations. When you call for an appointment with a Network provider, it's a good idea to double check that the provider is still in the Aetna DMO Network. Primary Care Dentist If you choose the DMO, you must have a Primary Care Dentist (PCD) on file with Aetna. The PCD is the dentist that you'll see for all your dental care. If your PCD leaves the DMO Network, you must select a new PCD to be covered, even if you have treatment in process. You may change your PCD at any time by calling Aetna at 1-866-276-4916. If you change your PCD on or before the 15th of the month, your change goes into effect on the first day of the following month. If you call after the 15th of the month, your change goes into effect on the first day of the second following month. You will receive a new Dental ID card if you are in the DMO and select a new PCD.

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2015 Retiree Dental Insurance SPD

If you were referred to a specialty dentist who leaves the DMO Network while treatment is in progress, you may complete the treatment and charges will still be covered. Paying for Dental Expenses In addition to the monthly premium, which is based on the option and the coverage level you select, you must pay Coinsurance on Major Care and orthodontia. Annual Maximum There are no annual maximums for the DMO option. Lifetime Maximum The DMO option limits you to one complete course of orthodontia per lifetime per person. Emergency Care Your emergency care is covered 24 hours a day, seven days a week. If you need emergency care after regular office hours, contact your PCD at the telephone number shown on the front of your Dental ID card. If you can't reach your PCD or you are out of town, call Aetna at 1-866-276-4916 for help. If you must receive emergency care from a non-Network provider, treatment will be covered up to the lesser of the Reasonable and Customary (R&C) limits or the actual charges up to a maximum of $100. Alternate Procedures In some cases, there may be more than one way to treat your dental condition. When that happens, Dental pays for the least expensive treatment that will give you a result that meets professional dentistry standards. For example, if you need a filling on one of your back teeth, Dental will only cover the R&C cost of a silver-colored filling. If your dentist fills your tooth with an enamel, tooth-colored material, you will have to pay the difference between the silver filling and the enamel one. Because you will have to pay for any additional costs if you choose — or your dentist performs a more costly procedure — it's very important that you get a pretreatment estimate. Pre-Treatment Estimates A Pre-Treatment Estimate is an estimate of how Dental will cover upcoming dental work. It's a good idea to have your dentist provide a Pre-Treatment Estimate when you are planning to have services that will cost more than $350 or when your dentist suggests: 

Orthodontia;



Oral surgery;



Periodontia (treatment of gums);

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2015 Retiree Dental Insurance SPD



Full or partial dentures;



Fixed bridgework;



Crowns; or



Any significant dental treatments.

While the Pre-Treatment Estimate is a good indication of what you will be expected to pay, it is not a guarantee of how your services will be covered.

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2015 Retiree Dental Insurance SPD

Plan Amendment or Termination Plan Amendment or Termination The Plan, policies and programs described in this SPD can be amended or terminated at any time, with or without prior notice or approval by you or any other Participant, including anyone making claims through you or any other Participant. The right to amend or terminate includes: 

The right to reduce or eliminate coverage for any treatment, procedure or service regardless of whether any Participant is receiving benefits on such treatment for an injury, defect or disability that occurred before the effective date of the amendment;



The right to limit any Participating Employers' contributions made to the Plan on behalf of Participants; and



The right to require Participants to pay the balance of Plan costs.

Neither the Plan nor the benefits described in this SPD can be orally amended. All oral statements and representations shall be without force or effect. Only written statements by the applicable committee of the Plan shall bind the Plan.

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2015 Retiree Dental Insurance SPD

ERISA Disclosures About Your Benefits Plan Name and Related Information Retiree Dental coverage is a benefit option under the J. C. Penney Corporation, Inc. Health and Welfare Benefit Plan (the "Plan"). The Plan is sponsored by the Company and is an employer-sponsored, health and welfare employee benefit plan governed under ERISA. Some benefits offered under the Plan are insured through contracts with insurance companies. The insurance companies are the named fiduciaries for fully-insured options; they administer claims and appeals and are solely responsible for providing the applicable benefit under the Plan. Eligibility to participate in Retiree Dental coverage under the Plan is determined by a third-party administrator on behalf of the Plan Administrator. See the Eligibility and Enrolling for Benefits sections for further information on the eligibility and enrollment administrators.

Plan Sponsor Information Plan Sponsor J. C. Penney Corporation, Inc. 6501 Legacy Drive Plano, TX 75024-3698 Plan Sponsor's Employer Identification Number 13-5583779 Plan Identification Number 501 Plan Year January 1 – December 31

Participating Employers The following employers participate in the Retiree Dental option under the Health and Welfare Plan: J.C. Penney Company, Inc. 6501 Legacy Drive Plano, Texas 75024-3698 J.C. Penney Corporation, Inc. 6501 Legacy Drive Plano, TX 75024-3698

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2015 Retiree Dental Insurance SPD

JCPenney Puerto Rico, Inc. Plaza Las Americas F.D. Roosevelt Ave. Hato Rey, PR 00918 J.C. Penney Purchasing Corporation 6501 Legacy Drive Plano, Texas 75024-3698 JCP Media, Inc. 6501 Legacy Drive Plano, TX 75024-3698 JCP Procurement, Inc. 6501 Legacy Drive Plano, TX 75024-3698 JCP Logistics, Inc. 6501 Legacy Drive Plano, TX 75024-3698 JCPSSC, Inc. 6501 Legacy Drive Plano, TX 75024-3698

Plan Administrator The Plan Administrator is: Benefits Administration Committee J.C. Penney Corporation, Inc. 6501 Legacy Drive Plano, TX 75024-3698 The Benefits Administration Committee (BAC) is the Plan Administrator. The Plan Administrator is the named fiduciary for the Retiree Dental option and has the authority to control, administer and manage the operation of the Retiree Dental option. The rights to carry out responsibilities and use maximum discretionary authority permitted by law are assigned to the Plan Administrator. The Plan Administrator has the authority to appoint other persons to be named fiduciaries and/or Claims Administrator and to appoint trustees under the Plan. The Plan expressly gives the BAC or a named fiduciary discretionary authority to resolve all disputes concerning the administration, interpretation, or application of the Plan. An Insurer is the Claims Administrator and named fiduciary of any insured benefit. Any Claims Administrator appointed by the BAC shall perform all of the duties and may exercise all of the powers and discretion that the Claims Administrator deems necessary or appropriate for the administration of the Plan and will do so in a uniform and non-discriminatory manner. Any failure of the Claims Administrator to

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2015 Retiree Dental Insurance SPD

apply any provision of the Plan to any particular situation shall not represent a waiver of the Claims Administrator's authority to apply such provisions thereafter. Except to the extent delegated to an Insurer, as a result of the benefit being fully insured, or other fiduciary, the Plan Administrator shall have some or all of the duties and powers necessary to carry out its responsibilities under the Plan, including, but in no way limited to the following: 1. Discretionary authority to construe and interpret the Plan, to decide all questions of eligibility, to determine the amount, manner and time of payment of any benefits under the Plan, and to resolve any ambiguities with respect to any terms and provisions of the Plan, either as written or as applied in the operation of the Plan. 2. To prescribe procedures to be followed in an application for benefits. 3. To prepare and distribute information explaining the Plan in such a manner as the Plan Administrator determines appropriate. 4. To receive from the Employer and covered Participants in the Plan the information necessary for the proper administration of the Plan. 5. To furnish the Employer and covered Participants, on request, such annual reports as are reasonable and appropriate with respect to the administration of the Plan. 6. To receive, review and keep on file such reports on receipts and disbursements of the Plan as the Plan Administrator considers appropriate. 7. To appoint or employ agents, subcontractors, and Representatives to assist in the administration of the Plan and such other agents, including claims processors, administrators, accounts, actuaries and legal counsel. The Plan Administrator, Insurer or other fiduciary, as applicable, will exercise the authority and responsibility that is appropriate in order to comply with ERISA and governmental regulations issued thereunder. The Plan Administrator, Insurer or other fiduciary, as applicable, may act in writing and keep a record of all its acts. All decisions of the applicable fiduciary shall be made by the fiduciary or by the duly authorized agents and employees of the fiduciary. Every interpretation, choice, determination or other exercise of any power or discretion given either expressly or by implication to the BAC or other fiduciary shall be conclusive and binding upon all parties having or claiming to have an interest under the Plan or otherwise directly or indirectly affected by such action, without restriction, however, on the right of the BAC or other fiduciary to reconsider and redetermine such action. Any decision by the BAC or other fiduciary and any review of such decision shall be limited to determining whether the decision was so arbitrary and unpredictable as to be an abuse of discretion. The Claims Administrator may adopt rules and procedures that are consistent with the terms of the Plan for the administration of the Plan.

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2015 Retiree Dental Insurance SPD

Plan Administration The Plan is self-administered by the Plan Administrator. The Plan Administrator has, however, by contract secured the services of a Claims Administrator for the purpose of handling certain administrative functions, including the review, processing, and payment of claims. The name, address and telephone number of the Claims Administrators for the Retiree Dental benefits under the Plan are: Dental Basic and Dental Plus Aetna P.O. Box 14094 Lexington, KY 40512-4094 1-866-276-4916 www.aetna.com DMO Aetna DMO P.O. Box 14094 Lexington, KY 40512-4094 1-866-276-4916 www.aetna.com Source of Contributions and Funding Related to Retiree Dental Benefits The benefits under the Plan are self-funded. This means that benefits are paid out of the general assets of the Plan Sponsor. Contributions for Retiree Dental benefits are determined by the Plan Sponsor and include Employee contributions by Participants and contributions by the Company. Your Employee contributions are based on the level, the type of benefit coverages that you elect and the cost of providing the benefits. Agent for Service of Legal Process Legal process for the Plan may be served on the Plan Sponsor, the Plan Administrator, or the Claims Administrator, or, with respect to an insured benefit, the Insurer.

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2015 Retiree Dental Insurance SPD

Claims and Appeals Filing Claims When you visit a Network Provider, your dentist will file your claim for you. If your dentist isn't in the Network, he or she may file the claim for you or ask you to pay for the services up front. If you pay your dentist up front, you can file a claim to be reimbursed. Instructions for filing the claim are on the claim form. Claim forms are available online. Be sure to keep copies of your claims and receipts. You must send your claim to the Claims Administrator by June 30 of the year following the date the covered expense was incurred. If the Claims Administrator does not receive your claim by June 30, you will not receive reimbursement for the claim unless the reason you failed to submit the claim was beyond your control. The Dental option pays benefits for certain dental services and supplies based on the date the expense is incurred. The following rules are used to determine when an expense is incurred: 

Full and partial dentures — The Plan pays based on when the final impression is taken.



Fixed bridges, crowns, inlays and onlays — The Plan pays based on when the teeth are first prepared.



Root canal therapy — The Plan pays based on when the pulp chamber is opened.



Orthodontia — The Plan pays based on when the appliances or bands are placed.

Claims and Appeals Process The Company has contracted with Aetna to be the Claims Administrator for the Retiree Dental coverage option. As such, Aetna, or its designee, has full discretionary authority to make decisions regarding claims for benefits under the Retiree Dental option, as applicable. Filing a Claim for Eligibility or Enrollment If you feel that you or your Dependent(s) were incorrectly denied eligibility or enrollment rights, you may file a written claim for eligibility or enrollment with Claims and Appeals Management (CAM) as soon as possible. You may submit your claim either by completing the Claim Initiation Form or by writing a letter including your name, Employee ID number, Unit Number, benefit option involved and the reason for your claim. Call PowerLine at 1-888-890-8900 to request a Claim Initiation Form. Send your letter or Claim Initiation Form to CAM: Fax (do not include a cover sheet): 1-847-554-1394

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2015 Retiree Dental Insurance SPD

Or mail to: JCPenney — Claims and Appeals Management P.O. Box 1407 Lincolnshire, IL 60069-1407 CAM will respond to any claim it receives within 60 days (unless the eligibility or enrollment claim arises in connection with a denied claim for dental benefits, in which case the applicable time frame described below will apply). If due to special circumstances more time is needed to respond to your claim, CAM will notify you that it needs an extension of up to 60 days. Filing an Appeal for Eligibility or Enrollment If CAM denies your claim for eligibility or enrollment in the benefit plan, you (or your authorized Representative) have the right to file an appeal. You may appeal this denial to the Benefits Administration Committee (BAC) within 180 days from the date you receive this letter. If you do not submit an appeal to the BAC during this time period, no further action will be taken and you may not file an appeal at a later date. Submit your appeal in writing to: Benefits Administration Committee J. C. Penney Corporation, Inc. 6501 Legacy Drive Plano, TX 75024-3698 In preparing your appeal, you have the right to receive upon request and without charge, reasonable access to, or copies of, any relevant documents, records or other information relied upon by CAM in making its determination. Send your request to CAM at the address or fax number provided under "Filing a Claim for Eligibility or Enrollment." If you have any additional information or documentation to support your claim, you must submit it with your appeal. The BAC will review the facts, the reason for CAM's decision, and any additional information you have provided. You should receive a written response from the BAC within 60 days following the BAC's receipt of your appeal. If your appeal is denied, in whole or in part, the BAC's written response will list the specific reason(s) for the decision and the specific plan provisions on which the decision was based. If special circumstances would make the rendering of a decision within the 60-day period impossible, the BAC will have up to 120 days after its receipt of a request for review to render a decision regarding your appeal for eligibility or enrollment. If the BAC needs additional time to render a decision in your appeal it will furnish you, or your authorized Representative, written notice of the need for the extension of time in which to render a decision regarding your appeal prior to the date the extension period begins. Review of Claims Time Frame for Initial Claim Determination For all ERISA plans, the law allows a reasonable amount of time for the Claims Administrator to evaluate a claim and to decide whether to pay benefits based on the information contained in the written claim.

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2015 Retiree Dental Insurance SPD

The Claims Administrator for the Dental option is: Options

Fiduciary/Appeals Address

Dental Basic, Dental Plus or DMO

Aetna P.O. Box 14080 Lexington, KY 40512

The Claims Administrator has full discretionary authority to make decisions regarding claims for benefits under the Dental option. While Aetna, or its designee, may have its own claims procedures, including multiple levels of appeal with respect to the denial of a claim, those procedures must, at a minimum, comply with the time frames described below. For urgent care claims and pre-service claims (claims that require approval of the benefit before receiving medical care), the Claims Administrator will notify you of its benefit determination (whether adverse or not) within the following time frames: 

72 hours after receipt of a claim initiated for Urgent Care (a decision can be provided to you orally, as long as a written or electronic notification is provided to you within three days after the oral notification); or



15 days after receipt of a pre-service claim.

For post-service claims (claims that are submitted for payment after receiving medical care), the Claims Administrator will notify you of an adverse benefit determination within 30 days after receipt of a claim. An adverse benefit determination is any denial, reduction or termination of a benefit, or a failure to provide or make a payment, in whole or in part, for a benefit. For urgent care claims, if the Retiree Dental option requires advance approval of a service, supply or procedure before a benefit will be payable, you will be notified of the decision, whether adverse or not, as soon as possible, but not later than 24 hours after the claim is received. Further, if your claim is an urgent care claim and you fail to provide the Claims Administrator with sufficient information to determine whether, or to what extent, benefits are covered or payable under the Plan, the Claims Administrator must notify you of the specific information needed to complete the claim within 24 hours of receiving the claim. You will then have at least 48 hours to provide the information needed to process the claim. You will be notified of a determination no later than 48 hours after the earlier of: 

The Claims Administrator's receipt of the requested information; or



The end of the 48-hour period within which you were to provide the additional information, if the information is not received within that time.

For pre- and post-service claims, a 15-day extension may be allowed to make a determination, provided that the Claims Administrator determines that the extension is necessary due to matters beyond its control. If such an extension is necessary, the Claims Administrator must notify you before the end of the 15- or 30-day benefit determination period, as applicable, of the reason(s) requiring the extension and the

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2015 Retiree Dental Insurance SPD

date it expects to provide a decision on your claim. If such an extension is necessary due to your failure to submit the information necessary to decide the claim, the Claims Administrator's notice of extension must also specifically describe the required information. You then have 45 days to provide the information needed to process the claim. If an extension is necessary for a pre- or post-service claim due to your failure to submit the necessary information, the Plan's time frame for making a benefit determination is suspended from the date the Claims Administrator sends you the notice requesting additional information. With respect to a pre- or post-service claim, the initial 15- or 30-day benefit determination period, respectively, ends on the date the notice requesting additional information is sent. The extension period (i.e., the 15-day extension) within which a decision on the claim must be made by the Claims Administrator will begin on the date on which your response is received by the Claims Administrator (without regard to whether all of the requested information is provided), or, if earlier, the due date established by the Claims Administrator for furnishing the requested information (which must be at least 45 days). In addition, if you or your authorized Representative fails to follow the Plan's procedures for filing a preservice claim (including a pre-service claim involving Urgent Care), you or your authorized Representative must be notified of the failure and the proper procedures to be followed in filing a pre-service claim for benefits. This notification must be provided within five days (24 hours in the case of a failure to properly file a pre-service claim involving Urgent Care) following the failure. Notification may be oral, unless you or your authorized Representative requests written notification. This paragraph only applies to a failure that is a communication: 

By you or your authorized Representative that is received by a person or organizational unit customarily responsible for handling benefit matters; and



That names you, a specific medical condition or symptom, and a specific treatment, service or product for which approval is requested.

Urgent Care Claims Urgent care claims are those that either could seriously jeopardize the patient's life, health or ability to regain maximum function, or in the opinion of a Physician with knowledge of the patient's medical condition, would subject the patient to severe pain that cannot be adequately managed without the care or treatment requested in the claim for benefits — unless the special Urgent Care deadlines for response to a claim are not followed. An individual acting on behalf of the Plan, applying the judgment of a prudent layperson who has an average knowledge of health and medicine, can determine whether the Urgent Care definition has been satisfied. If, however, a Physician with knowledge of the patient's medical condition determines that the claim involves Urgent Care, it must be considered an urgent care claim. Concurrent Care Claims If an ongoing course of treatment that was previously approved by the Claims Administrator for a specific period of time or number of treatments is an urgent care claim as defined above, and you or your authorized Representative requests to extend the treatment, your request will be decided within 24 hours,

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2015 Retiree Dental Insurance SPD

provided the request is made at least 24 hours prior to the end of the approved treatment. If your or your authorized Representative's request for extended treatment is not made within 24 hours before the end of the approved treatment, the request will be treated as an urgent care claim and decided according to the urgent care claim time frames described earlier. If an ongoing course of treatment that was previously approved by the Claims Administrator for a specific period of time or number of treatments is a non-urgent circumstance, and your request to extend the treatment is a non-urgent circumstance, the request will be considered a new claim and decided according to the pre- or post-service time frames, whichever applies. Note: Any reduction or termination of a course of treatment will not be considered an adverse benefit determination if the reduction or termination of the treatment is the result of a Plan amendment or Plan termination. Adverse Benefit Determination The Claims Administrator will provide you with notification of any adverse benefit determination within the applicable time frame described above, which will set forth: 

The specific reason(s) for the adverse benefit determination;



Reference to the specific plan provisions on which the benefit determination is based;



A description of any additional material or information needed to process the claim and an explanation of why that material or information is necessary;



A description of the Plan's appeal procedures and the time limits applicable to those procedures, including a statement of your right to bring a civil action under section 502(a) of ERISA after an appeal of an adverse benefit determination;



Any internal rule, guideline, protocol or other similar criterion relied upon in making the adverse benefit determination, or a statement that a copy of this information will be provided free of charge upon request;



If the adverse benefit determination was based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the adverse determination, applying the terms of the Plan to your medical circumstances, or a statement that such explanation will be provided free of charge upon request; and



If the adverse benefit determination is for a claim involving Urgent Care, a description of the expedited review process applicable to the claim.

Procedures for Appealing an Adverse Benefit Determination If you receive an adverse benefit determination, you may ask for a review. You (or your authorized Representative) have 180 days following the receipt of a notification of an adverse benefit determination within which to appeal the determination. Any appeal of an adverse benefit determination must be submitted in writing to the Claims Administrator and must include the claim number, Participant's name, relevant date(s) and other information to describe your appeal. In addition, if you have an authorized

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2015 Retiree Dental Insurance SPD

Representative, evidence that the Representative is authorized to act on your behalf must be provided in writing to the Claims Administrator. For this purpose, an assignment of your rights to benefits under the Plan to a third party is not sufficient to make that third party your authorized Representative. When appealing an adverse benefit determination, you have the right to: 

Submit written comments, documents, records and other information relating to the claim for benefits.



Request free of charge reasonable access to, and copies of, all documents, records and other information relevant to your claim for benefits. For this purpose, a document, record, or other information is treated as relevant to your claim if it: 

Was relied upon in making the benefit determination;



Was submitted, considered or generated in the course of making the benefit determination, regardless of whether such document, record or other information was relied upon in making the benefit determination;



Demonstrates compliance with the administrative processes and safeguards required in making the benefit determination; or



Constitutes a statement of policy or guidance with respect to the Plan concerning the denied benefit for your diagnosis, regardless of whether such statement was relied upon in making the benefit determination.



A review that takes into account all comments, documents, records and other information submitted by you related to the claim, regardless of whether the information was submitted or considered in the initial benefit determination.



A review that does not defer to the initial adverse benefit determination and that is conducted neither by the individual who made the adverse determination nor by that person's subordinate.



If the appeal involves an adverse benefit determination based in whole or in part on a medical judgment (including whether a particular treatment, drug or other item is experimental), a review in which the named fiduciary consults with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment, and who was neither consulted in connection with the initial adverse benefit determination, nor the subordinate of any such individual.



The identification of medical or vocational experts whose advice was obtained in connection with the adverse benefit determination, regardless of whether the advice was relied upon in making the decision.



In the case of a claim for Urgent Care, an expedited review process in which: 

You may submit a request in writing or by a telephone call to the Plan Sponsor for an expedited appeal of an adverse benefit determination; and

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2015 Retiree Dental Insurance SPD



All necessary information, including the Plan's benefit determination on review, will be transmitted between the Plan and you by telephone, facsimile or other available similarly prompt method.

Ordinarily, a decision regarding an appeal of an adverse benefit determination will be reached within: 

72 hours after receipt of a request for review of an urgent care claim;



30 days after receipt of a request for review of a pre-service claim; or



60 days after receipt of a request for review of a post-service claim.

If an adverse benefit determination is upheld by the Claims Administrator on appeal, the Claims Administrator will provide you with written notice of its decision on appeal. The Claims Administrator's notice of adverse benefit determination on appeal will contain all of the following information: 

The specific reason(s) for the adverse benefit determination;



References to the specific plan provisions on which the benefit determination is based;



A statement that upon request you are entitled to receive, free of charge, reasonable access to, and copies of, all documents, records and other information relevant to your claim;



A statement describing any voluntary appeal procedures offered by the Plan and your right to obtain the information about such procedures, and a statement of your right to bring a civil action under section 502(a) of ERISA;



Any internal rule, guideline, protocol or other similar criterion relied upon in making the adverse benefit determination, or a statement that a copy of this information will be provided free of charge upon request; and



If the adverse benefit determination was based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the adverse determination, applying the terms of the Plan to your medical circumstances, or a statement that such explanation will be provided, free of charge, upon request.

Clerical Error If a clerical error or other mistake occurs, that error does not create a right to benefits. These errors include, but are not limited to, providing misinformation on eligibility or benefit coverages or entitlements. You are responsible for confirming the accuracy of statements made by the Plan Administrator, PowerLine or the Claims Administrator, in accordance with the terms of this and other plan documents. Information and Records At times, the Claims Administrator may need additional information from you. You agree to furnish all information and proof that may reasonably be required regarding any matters pertaining to the Plan. If you do not provide this information when it is requested, benefit payments may be delayed or denied.

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2015 Retiree Dental Insurance SPD

By accepting benefits under the Plan, you authorize and direct any person or institution that has provided services to you to furnish the Plan or the Claims Administrator with all information or copies of records relating to the services provided to you. The Claims Administrator has the right to request this information at any reasonable time. This applies to all covered persons, including Dependents. The Claims Administrator will treat such information and records as confidential information. Limitation of Action You cannot bring any legal action against the Company or the Claims Administrator to recover reimbursement until 90 days after you have properly submitted a Claim as described in this SPD and all required reviews of your Claim have been completed. If you want to bring a legal action against the Company or the Claims Administrator, you must do so within three years from the expiration of the time period in which a Claim must be submitted or you lose any rights to bring such an action against the Company or the Claims Administrator. You cannot bring any legal action against the Company or the Claims Administrator for any other reason unless you first exhaust all of the administrative remedies available to you under the Plan as described in this SPD. If you want to bring a legal action against the Company or the Claims Administrator after you have exhausted all of the administrative remedies available to you under the Plan, you must do so within (i) three years of the date of service giving rise to your Claim or (ii) two years after you are notified of the final decision on your appeal, whichever is later, or you lose any rights to bring such an action against the Company or the Claims Administrator.

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2015 Retiree Dental Insurance SPD

Coordination of Benefits (COB) Coordination of Benefits Overview If you and any of your Dependents are covered by more than one group health plan or any other insurance plan or policy, reimbursements are coordinated between the plans so that benefits are not duplicated. When you are covered by more than one medical plan, dental plan or any other insurance plan or policy, the plan or policy that pays benefits first is called the "primary plan." The primary plan pays its benefits without considering what the other plan may pay. The other plan, called the "secondary plan," may pay additional benefits depending on its Coordination of Benefits (COB) provisions.

Coordination with Dental or Medical Plans When you are covered by more than one medical plan or more than one dental plan and the JCPenney plan is secondary, your reimbursement is adjusted so that the total amount you receive from both plans is not more than the amount paid by the plan with the highest reimbursement level. This way, neither plan pays more than it would have without COB. If you have coverage under a dental plan, including the Dental option, the Dental plan pays benefits for dental services before a Medical plan, including the Medical option. In other words, a medical plan will be secondary.

Determining Which Plan Is Primary The following rules determine which plan pays benefits first: 

If one of the plans has no COB provision, that plan is always primary.



When both plans have a COB provision: 

If you and your Spouse/DP both cover your children and you are not separated or divorced, the plan of the parent whose birthday (month and day) occurs first in the calendar year is primary. This is called the "birthday rule." (If one plan does not have the birthday rule, the father's, or the Retired Associate's if the separation or divorce involves Domestic Partners, plan is primary.)



The Dental option is primary for all covered Retired Associates.



The plan covering an active Associate or Dependent is primary to a plan covering someone who is retired or laid off or the plan of a Dependent of someone who is retired or laid off. (But if the other plan does not include this rule, it will not apply.)

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2015 Retiree Dental Insurance SPD



The plan covering an active Associate or Dependent is primary to a plan of someone who is covered as a COBRA Participant. If the plan has a Pre-Existing Condition exclusion, expenses for the Pre-Existing Condition will be paid first by the COBRA plan.

If none of these rules apply, the plan that has covered the person longest is the primary plan.

Coordination with Auto, Home Owners or Other Insurance Any auto, home owners or other insurance you have is considered primary for expenses due to injuries resulting from an accident. If injuries are due to an auto accident, any auto insurance is primary, even when the auto insurance is "no fault" coverage required by law.

Coordination with Workers' Compensation Any Workers' Compensation or Texas Worker Injury Plan (TWIP) coverage will be considered primary.

Children of Divorced or Separated Parents If you and your Spouse are divorced or legally separated and you both cover your children, the following rules apply: 

If a court or administrative order makes one parent financially responsible for the child's health care coverage, that parent's plan is primary.



If the parent with sole custody remarries, the order of payment is: 

The plan of the parent with custody is primary



The plan of the stepparent is secondary, or



The plan of the parent without custody is third.

If the court does not assign financial responsibility for the child's health care coverage and the parents have joint custody, the 'birthday rule," explained in Determining Which Plan Is Primary, will apply.

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2015 Retiree Dental Insurance SPD

Subrogation Reimbursement and Third-Party Recovery Provision In the event of any benefit payments made under the Retiree Dental option under the Plan to or on behalf of you or your Dependent, an automatic equitable subrogation lien, to the extent of such payments, attaches in favor of the Plan to all the rights of recovery and other rights you or your Dependent may have arising out of any claim or cause of action that may accrue because of the alleged malpractice, accidental, negligent, intentional, or tortuous conduct, act or omission, even without admission or fault of another person or entity (hereinafter all such persons or entities will be individually and collectively referred to as a "third party"). By participation in this Plan you and your Dependents agree that as a result of this equitable subrogation lien estate, and the legal Representatives of your or your Dependent's estate, will be obligated and that the Plan will be fully subrogated under this automatic equitable subrogation lien to any recovery or right of recovery that you or your Dependents or the estate may have against any third party, including without limitation, any wrongful death claim. State law doctrines and rules, such as the "make whole" doctrine, the "antiassignment" rule or any other state law or rule, will not prevent the Plan from recovering 100% of its payments from the proceeds of the recovery. You, your Dependent or the legal Representative of beneficiaries of you or your estate, must notify the Plan Administrator of any claim or lawsuit against a third party or insurance carrier within 30 days of the date that the claim is made or the lawsuit is filed. The Plan Administrator, on behalf of the Plan, also has the right to pursue any action to enforce its automatic equitable subrogation lien against a third party or insurance carrier.

Your Agreement to Subrogation and Reimbursement You and your Dependents, on behalf of you and your Dependents and each beneficiary of a payment made on you and your Dependents' behalf, by accepting any benefits under the Plan, consent and agree: 1. That the Plan will be promptly reimbursed for 100% of the payments made to or on your and your Dependent's behalf under the Plan out of the first monies recovered as a result of any lawsuit, judgment, order, award, settlement, compromise, arbitration or other arrangement (regardless of whether there has been a full recovery or such sums are allocated to any particular type of loss, damage or expense and regardless of whether you or your Dependent has been fully compensated for your losses or "made whole"); and 2. To include all benefits paid or payable under the Plan in any liability or other claim against a third party or its insurance carrier. Furthermore, you or your Dependent and your beneficiaries promise and agree to take such action, to furnish such information and assistance, to execute and deliver any assignments, subrogation and reimbursement agreements, and other instruments as the Plan Administrator or its agent may require to facilitate enforcement of the Plan's equitable subrogation lien and reimbursement rights, and not to prejudice, or in any way detrimentally affect, such rights. The Plan's rights will not be affected by any release, including a partial release, that is entered into without the consent of the Plan Administrator. The Plan's automatic equitable subrogation lien and reimbursement rights will extend to: 1. All conceivable sources of recovery, other than the Plan itself, including, by way of example and not limitation, any and all automobile insurance coverage (including uninsured/underinsured motorist coverage), no-fault coverage, medical insurance coverage, school insurance coverage,

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2015 Retiree Dental Insurance SPD

disability coverage, personal injury awards or settlements, and medical malpractice awards or settlements; and 2. All types of payments made by or on behalf of a third party, regardless of how designated, including without limitation, payments for medical expenses, disability, accidental death or dismemberment, past or future wages or loss of earnings capacity, pain and suffering, mental anguish, loss of consortium or companionship, and exemplary damages of any kind. For purposes of clarity and not limitation, to the extent that a recovery from a third party is obtained by an attorney for you or your Dependent, the full amount that the Plan is entitled to recover hereunder will not be offset or otherwise reduced by any attorney's fees or other costs of recovery that were not specifically approved in advance, in writing by the Plan Administrator or its designated agent.

Limitation to the Plan's Subrogation and Reimbursement Rights The Plan's automatic equitable subrogation lien and reimbursement rights: 1. Will extend only to the recovery by the Plan of the benefits that it has paid or will pay to or on behalf of your or your Dependent or beneficiary and the cost of prosecuting the claim for recovery, including reasonable attorney's fees and court and collection costs; and 2. Will fully apply and control even if you or your Dependent or beneficiary thereof has only received a partial recovery from a third party.

Subrogation and Reimbursement Rights Not Affected by Payment The Plan's automatic equitable subrogation lien and reimbursement rights will not be affected if benefits are paid under the Plan before the Plan Administrator or its agent obtains any additional agreements from you or your Dependent (or from any other payee) or if the Plan Administrator does not request any such agreement. In addition, the failure or refusal of you or your Dependent (or other payee, if applicable) to sign an agreement at the request of the Plan Administrator or its agent recognizing the Plan's automatic equitable subrogation lien and reimbursement rights may result in a forfeiture of all benefits payable to you or your Dependent (or other payee), as determined by the Plan Administrator, even if such benefits have already been paid. The Plan Administrator will retain a right to recover paid benefits which are forfeited in such a manner; moreover, any such failure or refusal will not affect the Plan's rights, which will remain in full force and effect.

Lien on Proceeds The Plan Administrator, on behalf of the Plan, will have a first and primary equitable lien against the proceeds of any settlement, award or judgment that result from a claim, lawsuit or other action by or on behalf of your or your Dependent who received benefits under the Plan. Notice of the lien is sufficient to establish the Plan's lien against the third party or insurance carrier. The Plan Administrator will be entitled to: 1. Deduct the amount of the lien from any future claims payable to or on behalf of you or your Dependent if: 1. The lien is not repaid or otherwise recovered by the Plan Administrator; or 2. You, your Dependent or other claimant fails to promptly notify the Plan Administrator of such a payment received from a third party or insurance carrier that is subject to the Plan's subrogation and to reimbursement rights.

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2015 Retiree Dental Insurance SPD

2. Otherwise take any action that the Plan Administrator deems necessary or appropriate, in its discretion, to enforce the Plan's rights to automatic equitable subrogation lien and reimbursement rights to the full extent permitted by law.

Right to Receive and Release Necessary Information For the purposes of determining the applicability of and implementing the terms of this Plan or any other plan, the Plan Administrator or Claims Administrator may, without the consent of or notice to any person, release to or obtain from any insurance company or other organization or person any information that the Plan Administrator or Claims Administrator deems to be necessary for such purposes, with respect to any person claiming benefits under this Plan. Any person claiming benefits under this Plan shall furnish to the Plan Administrator or Claims Administrator such information as may be necessary to implement this provision. This paragraph does not apply to obtaining and releasing Protected Health Information, which is addressed in a separate section of this SPD. If it becomes necessary for the Plan to enforce this provision by initiating any action against the Employee, then the Employee agrees to pay the Plan's attorney's fees and costs associated with the action regardless of the action's outcome. The Plan Sponsor has sole discretion to interpret the terms of this provision in its entirety and reserves the right to make changes as it deems necessary. If the Employee takes no action to recover money from any source, then the Employee agrees to allow the Plan to initiate its own direct action for reimbursement.

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2015 Retiree Dental Insurance SPD

Continuing Your Coverage under COBRA Highlights When a covered Retiree and/or the Retiree's covered Dependents would otherwise lose coverage under the Retiree Dental option, a federal law known as "COBRA" may allow the covered Retiree and/or the Retiree's covered Dependents to temporarily continue coverage under the Retiree Dental option in certain circumstances. This section summarizes a Retiree's options for COBRA continuation of health care coverage. Except as may otherwise be expressly and unambiguously described in this SPD, the coverage described in this SPD provides no greater COBRA rights than what COBRA requires, and nothing in this SPD is intended to expand a Participant's rights beyond COBRA's minimum statutory requirements. COBRA applies if a "qualifying event" occurs that would otherwise cause a covered Retiree or a covered Dependent to "lose coverage." COBRA calls each person who would lose coverage as a result of a qualifying event a "qualified beneficiary." Each qualified beneficiary has an independent right to elect COBRA coverage. For the Retiree Dental option, COBRA coverage can last up to 18 or 36 months, depending on the qualifying event. The 18 months of COBRA coverage can be extended to 29 months if a disability is involved, as described below. COBRA coverage is the same coverage that other Retirees or Dependents, who are not receiving COBRA coverage, have under the Retiree Dental option. Each qualified beneficiary that elects COBRA coverage will have the same rights under the Retiree Dental option as Retirees under the Retiree Dental option who are not receiving COBRA coverage including Annual Enrollment and, as applicable, rights as a result of a change in status or life event and Special Enrollment Rights. Qualified beneficiaries who elect COBRA must pay for COBRA coverage. COBRA coverage can be expensive. COBRA premiums can be as much as 102% of the actual cost of providing coverage (150% for disability extensions, explained later). Remember that the Company subsidizes part of the cost of non-COBRA coverage under the Retiree Dental option for Retirees and their covered Dependents. COBRA does not include this employer subsidy, so COBRA premiums may be quite a bit higher than what a non-COBRA Retiree is required to pay.

Qualifying Events A qualifying event is any of the following events that causes a Retiree and/or a covered Dependent to lose coverage under the Retiree Dental option. Covered Retirees You become a COBRA qualified beneficiary if you lose your coverage under the medical plan because of the following qualifying event: 

The Company or a Participating Employer commences Chapter 11 bankruptcy proceedings.

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2015 Retiree Dental Insurance SPD

Spouse Your Spouse becomes a COBRA qualified beneficiary if he or she loses coverage under the Retiree Dental option because of one of the following qualifying events: 

You die.



You become divorced from your spouse.



The Company or a Participating Employer commences Chapter 11 bankruptcy proceedings.

Dependent Child A Dependent child becomes a COBRA qualified beneficiary if he or she loses coverage under the Retiree Dental option because of one of the following qualifying events: 

The parent-covered Retiree dies.



The parents become divorced.



The child loses eligibility for coverage as a "Dependent child" under the terms of the Retiree Dental option.



The Company or a Participating Employer commences Chapter 11 bankruptcy proceedings.

Losing Coverage A loss of coverage means that, because of the qualifying event, a Retiree or the Retiree's covered Dependents cease to be covered on the same terms and conditions as were in effect immediately before the qualifying event. This includes the loss of eligibility for coverage as well as an increase in the cost of coverage caused by the qualifying event. A loss of COBRA coverage itself, however, is not a qualifying event.

Qualified Beneficiaries A qualified beneficiary is each person who, on the day before a qualifying event, is a Participant under the Retiree Dental option, as applicable (other than COBRA continuation coverage), and who would lose that coverage because of the qualifying event. For example, in the case of a Retiree with Dependent coverage, this would be the Retiree and each covered Dependent. Qualified beneficiaries also include Children who are born to or placed for adoption with a Retiree during the term of a Retiree's COBRA continuation coverage. Each qualified beneficiary has an independent right to elect COBRA continuation coverage. This means qualified beneficiaries may elect COBRA coverage for themselves, regardless of whether other family members who are also qualified beneficiaries elect or decline coverage. Qualified beneficiaries who elect COBRA continuation coverage may change health plans or add/drop eligible Dependents at Annual Enrollment; however, Dependents who are not themselves qualified beneficiaries do not become qualified beneficiaries if they are added or dropped at Annual Enrollment. For example, if a Retiree who is a qualified beneficiary with You-only coverage adds a Dependent Child

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2015 Retiree Dental Insurance SPD

who (i) is not a newborn or a Child placed for adoption with the Retiree and (ii) was not covered under the Retiree Dental option on the day before the qualifying event to the Retiree's coverage during Annual Enrollment, that Dependent is not a qualified beneficiary. Special Enrollment Periods may permit a qualified beneficiary to add coverage for new Dependents or Dependents who lose other coverage; however, the Dependent(s) will not themselves become qualified beneficiaries (except if the Dependent is a newborn or adopted Child of a Retiree, or a Child placed for adoption with a Retiree during the Retiree's COBRA continuation period).

Benefit Eligibility COBRA coverage is the same group health care coverage that is offered to similarly situated nonCOBRA, Retirees and their Dependents. The right to elect COBRA continuation coverage applies only if the person had the corresponding coverage when the qualifying event occurred. For example, if a Retiree had coverage under the Medical option, but not the Dental option, then the Retiree would be offered COBRA coverage under the Medical option, but not COBRA coverage under the Dental option; however, because a qualified beneficiary who elects COBRA continuation coverage has the same rights as a similarly situated Retiree, a qualified beneficiary may elect to add coverage under the Dental option during any Annual Enrollment period which occurs during the qualified beneficiary's COBRA continuation period. Each qualified beneficiary has an independent right to elect COBRA continuation for the Retiree Dental coverage he or she would lose. For example, if a Retiree had family coverage under the Retiree Dental option, then the Retiree and each covered Dependent could elect COBRA continuation under the Retiree Dental option. A parent may elect continuation with respect to any Dependent Child who is a qualified beneficiary. A Retiree, however, cannot decline COBRA coverage for his or her Spouse; the Retiree's Spouse must decline coverage.

COBRA Continuation Period COBRA continuation coverage is a temporary continuation of coverage. It lasts for up to a total of 36 months when the qualifying event is: 

The death of the covered Retiree.



Your divorce.



A Dependent child losing eligibility as a Dependent child.

In the case of a bankruptcy proceeding, COBRA continuation coverage generally lasts for the covered Retiree until the date of the covered Retiree's death. For a Spouse, surviving Spouse, or Dependent child, COBRA continuation coverage ends on the earlier of: 

The date of the Spouse's, surviving Spouse's, or Dependent child's death; or



36 months after the date of the covered Retiree's death.

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2015 Retiree Dental Insurance SPD

COBRA qualifying events Maximum continuation period (months) for: Qualifying event

You

Spouse

Covered child

Your covered child no longer qualifies as a Dependent

N/A

N/A

36

N/A

36

36

N/A

36

36

Until the date of covered Retiree's death

Earlier of Spouse's (including surviving Spouse's) death or 36 months after covered Retiree's death

Earlier of Dependent Child's death or 36 months after covered Retiree's death

You die

1

You and your Spouse divorce JCPenney commences Chapter 11 bankruptcy proceeding

1

If you die while you are a covered Retiree, a surviving Spouse may continue health coverage under the Retiree Dental option's surviving Spouse provisions for your surviving Spouse and Dependent children by paying 100% of the premium. If your Dependents elect to continue coverage under COBRA, they will not be eligible for Retiree Dental coverage later.

You and your eligible Dependents have 60 days from the date coverage ends due to a qualifying event or from the date of your COBRA notice, whichever is later, to elect continued participation under COBRA.

Notice of Qualifying Event Divorce or Separation or Dependent Child Becoming Ineligible If a Retiree and the Retiree's Spouse divorce or become legally separated, or a Retiree's Dependent child reaches the maximum age for coverage and the Retiree has health care coverage for any of these persons, then the Retiree or the Retiree's Spouse or Dependent Child must call PowerLine at 1-888-8908900 within 60 days from the date of the event or, if later, from the date the Retiree's Spouse or Dependent Child would lose coverage under the terms of the Retiree Dental option, as applicable, because of the qualifying event. The Plan Administrator will then send any affected qualified beneficiaries a COBRA notice to their last known address(es), describing the continuation options and premiums, along with a form for electing continuation coverage. A Retiree or the Retiree's Dependent who is already continuing coverage through COBRA should contact PowerLine directly. The Retiree may also provide notice via the PowerLine website (accessible via www.jcpassociates.com or www.JCPenneypowerline.com). If the Retiree or the Retiree's Dependent provides notice of the qualifying event in writing, he or she will receive instructions to call PowerLine at 1-888-890-8900.

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2015 Retiree Dental Insurance SPD

Notice of Second Qualifying Event The deadline for providing the notice of a second qualifying event is 60 days after the later of (i) the second qualifying event (i.e., a divorce or legal separation, the covered Retiree's death, or a child's loss of Dependent status); or (ii) the date on which the Participant would lose coverage under the terms of the Retiree Dental option, as applicable, as a result of the qualifying event. The Retiree or the Retiree's Spouse or Dependent child must call PowerLine at 1-888-890-8900. The Retiree may also provide notice via the PowerLine website (accessible via www.jcpassociates.com or www.JCPenneypowerline.com). If the Retiree or the Retiree's Dependent provides notice of the qualifying event in writing, he or she will receive instructions to call PowerLine at 1-888-890-8900.

All Other Qualifying Events For all other qualifying events, the Plan Administrator will notify any qualified beneficiaries — at the qualified beneficiary's last known address — of the right to elect COBRA continuation coverage under the Plan. The notice will describe the continuation options and premiums, and will contain a form for electing continuation coverage.

Returning the Election Form and Payment Any qualified beneficiaries who wish to elect COBRA continuation coverage must return the election form to the Plan Administrator within 60 days from the later of (i) the date notice is provided; or (ii) the date coverage is lost because of the qualifying event. Each qualified beneficiary has an independent right to elect COBRA coverage. If, however, a Retiree or a Retiree's covered Spouse elects coverage but does not specify that it is only for himself or herself, then that election is deemed to include an election of coverage on behalf of all other qualified beneficiaries with respect to that qualifying event. If a qualified beneficiary rejects COBRA continuation coverage before the due date for returning the election form described in the previous paragraph, the qualified beneficiary may change his or her mind and elect COBRA continuation coverage as long as the election form is provided before the due date. A qualified beneficiary does not have to send any payment with the COBRA continuation coverage election. For questions about COBRA eligibility or coverage, call PowerLine at 1-888-890-8900. If no response is made by the deadline, then the right to COBRA continuation coverage is lost for all qualifying beneficiaries. Mental incapacity or death may extend this deadline.

What Else You Should Know Cost COBRA coverage can be expensive. COBRA premiums can be as much as 102% of the actual cost of providing coverage (150% for certain disability extensions, discussed below). This may be quite a bit higher than the amount paid as a Retiree because your Employer subsidizes part of the cost of nonCOBRA Medical and Dental coverage for Retirees and their families. COBRA coverage does not qualify for this subsidy.

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2015 Retiree Dental Insurance SPD

When a qualified beneficiary becomes entitled to COBRA continuation coverage, a notice explaining the continuation options and how to elect them will be provided to the qualified beneficiary. That notice will state the premium costs associated with those options. All COBRA premiums must be paid at the times specified. If you elect COBRA continuation coverage, you may, but do not have to, send any payment with the election form; however, the initial payment (including all unpaid premiums retroactive to the date coverage otherwise would have ended) is due within 45 days after the date you elect COBRA continuation coverage. All other premium payments are due on the first day of the month to which they apply; however, there is a 45-day grace period for each monthly payment. Your payment is considered to have been made on the date that it is postmarked. You will not be considered to have made any payment if any check received is returned due to insufficient funds or otherwise. Claims for reimbursement will not be processed and paid until you have elected COBRA continuation coverage and made the first payment. Notice of Other Group Health Coverage If any qualified beneficiary becomes entitled to (i.e., enrolled in) Medicare Part A or B or becomes covered under another group health plan after COBRA continuation coverage has been elected, that qualified beneficiary must notify PowerLine immediately. COBRA coverage for that qualified beneficiary will be terminated once the qualified beneficiary becomes entitled to Medicare Part A or B, or becomes covered under another group health plan if the other coverage does not contain a Pre-Existing Condition limitation that applies to the qualified beneficiary.

Domestic Partners and COBRA Benefits Domestic Partners and their Children are eligible for COBRA-like coverage under the same terms and conditions as Spouses and Children who are eligible for COBRA coverage.

If You Have Questions If you have any questions about your COBRA continuation coverage, log on to PowerLine from the Associate Kiosk, the Associate Kiosk@Home (accessible via www.jcpassociates.com) or www.JCPenneypowerline.com or call PowerLine at 1-888-890-8900 and listen to the menu prompts. You may also contact the nearest Regional or District Office of the U.S. Department of Labor's Employee Benefits Security Administration (EBSA). Addresses and phone numbers are available through EBSA's website at www.dol.gov/ebsa.

Address Changes In order to protect your family's rights, you must keep PowerLine informed of any changes in the addresses of family members. If your address changes during your COBRA continuation period, call PowerLine at 1-888-890-8900 (and say "health care") to see the extent, if any, to which it could impact your coverage under the Retiree Dental option, as applicable, no longer being available. If necessary, you will receive an Enrollment Worksheet showing the options available based on your new address. You have 30 days from the date on this worksheet to change your options. The effective date of the coverage

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2015 Retiree Dental Insurance SPD

change will be the first of the month of, or following the date of, the address change. You may request to have the change effective the first day of the preceding month. You should keep a copy of any notices you send to or receive from PowerLine for your records.

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2015 Retiree Dental Insurance SPD

Qualified Medical Child Support Orders (QMCSO) About QMCSOs You may be required to provide health care coverage for a Child under a court or state administrative agency order. If a court or state administrative agency order satisfies the legal requirements for a QMCSO and you are eligible for Retiree Benefits, you should enroll yourself and the Child covered by the QMCSO in the Plan's Medical, Dental or Vision options as required. If you don't promptly enroll, JCPenney is required to enroll you and your Child(ren). In this situation, you will be enrolled in HSA 2000 under the Medical option, and Dental Basic coverage under the Dental option, as applicable, and you will not be able to change these options until the earlier of a Special Enrollment Right, a qualified change in status or the next Annual Enrollment. The necessary premiums will be deducted from your paycheck. You may be able to drop coverage for your child following a divorce, legal separation or termination of partnership if you have a QMCSO and can prove coverage is being provided by another party. If PowerLine receives a National Medical Child Support Order (NMCSO), the Plan Administrator is required to enroll you and your Child in the Plan's Medical, Dental and/or Vision options elected by the state administrative agency. The required contributions will be deducted from your paycheck. As soon as you learn of any legal proceeding that may require you to provide Medical, Dental and/or Vision coverage for your Child, call PowerLine at 1-888-890-8900. If you would like a copy of the policies and procedures for the submission and approval of a Medical Child Support Order, call PowerLine.

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2015 Retiree Dental Insurance SPD

Notice of Privacy Rights The Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rules The Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rules require any health or welfare plan sponsored by the Company or one of its affiliates and subject to the HIPAA Privacy Requirements (the "Plan") to take certain actions to protect the privacy of your health information, sometimes referred to as Protected Health Information (PHI). This Notice has been prepared to advise you of the uses and disclosures of your Protected Health Information that may be made by the Medical option (including the HMO), the Dental option (including the DMO), and the Health Care FSA option under the Plan, as applicable (the "Health Care Options"), and to advise you of your rights and the Plan's legal duties with regard to that information. If you have a question about whether a particular plan is covered by this Notice, contact the Plan's Privacy Officer. The Plan has delegated administration of the privacy rights under this Notice to the health care vendors (called "Business Associates") identified at the end of this Notice for the option(s) that the particular vendor administers on behalf of the Plan. The HMO and DMO options (i.e., fully insured options, who are not Business Associates) are required by law to provide you with their own privacy rights notice and have responsibility for administration of your privacy rights. What is Protected Health Information (PHI)? PHI means information under the Plan's Health Care Options related to a past or present health condition that identifies you or could reasonably be used to identify you and that is transferred or maintained by any of the Health Care Options under the Plan in written, electronic or any other form. Will the Plan have access to my PHI? Yes. As an individual enrolled in any of the Health Care Options under the Plan, you should be aware that the Plan (and certain designated Associates) may have access to your PHI. The Plan may receive your PHI in a variety of ways. For example, the Plan may receive PHI when your health care Provider submits bills to be paid by the Plan for services rendered to you. When may the Plan use or disclose my PHI? The Plan may use or disclose PHI for "treatment," "payment" and other "health care operations." When the Plan makes, uses or discloses of your PHI for these purposes, the Plan is not required to notify you or obtain your authorization. Treatment: Treatment means the provision, coordination or management of health care and related services by health care Providers, including the coordination or management of health care with the Plan and its Business Associates. For example, the Plan may use or disclose your PHI in order to make preauthorization decisions. Payment: Payment means activities undertaken by any one of the Heath Care Options under the Plan to determine or fulfill its responsibility for coverage and provision of benefits. Examples of when the Plan

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2015 Retiree Dental Insurance SPD

might use or disclose PHI for payment purposes under a Health Care Option include disclosures to facilitate the payment of claims made on the Plan by health care Providers, the Plan's activities under a Health Care Option to obtain or provide reimbursement for the provision of health care, or the Plan's activities in obtaining premiums for any of the Health Care Options. Health Care Operations: The term "health care operations" means those other functions and activities that the Plan performs in connection with providing health care benefits. For example, the Plan may use or disclose PHI for business planning purposes, to assess compliance with applicable law or to ensure proper record-keeping and accounting procedures. Health care operations include, but are not limited to, quality assessment and improvement, reviewing the competence or qualifications of health care professionals or a Health Care Option's Business Associates, selecting and contracting with Network Providers, underwriting, premium rating and other insurance or Health Care Options' activities related to creating or renewing contracts with Insurers or Business Associates. It also includes disease management, wellness programs, weight management, tobacco cessation, case management, conducting or arranging for independent medical reviews, benefit claims and appeals processing, subrogation services, legal and auditing functions including fraud and abuse detection, compliance programs, business planning and development, plan design, data aggregation, vendor selection, business management and general administrative activities. Health care operations also include providing Explanations of Benefits to you that include information about amounts owed by you and amounts paid by the applicable Health Care Option for health care services provided to you and any Dependents. The Health Care Options may need to use and disclose your PHI in connection with their day-to-day health care operations (for example, for utilization review, Network Provider selection, contracting with Network Providers and coordinating your care). The Health Care Options have established certain arrangements with each other such that they will share your PHI with each other. For example, the Medical option (except the HMO options) and the Dental option automatically share PHI with the Health Care FSA option so you can be reimbursed without filing a claim. Similarly, the Medical and Dental options share PHI for prescription drug coverage and Coordination of Benefits purposes. May the Plan use or disclose my PHI for other purposes? Yes. For uses or disclosures of PHI that are not made for treatment, payment or health care operations purposes and for which no exception regarding the requirement to obtain an authorization from you applies, the Plan must obtain your authorization to disclose your PHI to a particular person or entity for a particular purpose. You may revoke an authorization at any time, but a revocation is not effective if the Plan has already relied on your authorization. For example, an authorization would be required if the Plan uses or discloses PHI to your employer for disability, fitness for duty or drug testing purposes or if you request that the Plan use or disclose your PHI to a third party. When might the Plan make a use or disclosure of my PHI without my authorization? As discussed above, the Plan is not required to obtain your authorization to make uses or disclosures of your PHI for treatment, payments or health care operations purposes. Additionally, there are some limited exceptions in which the Plan may make uses or disclosures of your PHI for purposes other than

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2015 Retiree Dental Insurance SPD

treatment, payment or health care operations and without your authorization. Most of these uses or disclosures are permitted to promote the government's need to ensure a safe and healthy society. In some cases, you may be given an opportunity to agree or object before the use or disclosure is made; in other cases, you may not be given this opportunity. The types of uses or disclosures of PHI that may be made without your authorization and without giving you the opportunity to object include those made: to avert communicable or spreading diseases; for public health activities; for federal intelligence, counter-intelligence and national security purposes; to properly assist law enforcement to carry out their duties; when a judge or administrative tribunal orders the release of such PHI (subject to any required protections); for cadaveric organ, eye and tissue donations (where appropriate); to help apprehend criminals; to assist armed forces personnel and operations; for military service, veterans affairs separation/discharge matters; for coroner/medical examiner purposes; for health oversight purposes (such as when the government requests certain information from the Plan to determine its compliance with applicable laws); to assist victims of abuse, neglect or domestic violence; to address work-related illness/workplace injuries and for Workers' Compensation purposes; to carry out clinical research that involves treatment where the proper body has determined the importance for doing so; for FDA-related purposes; for certain health and safety purposes; for funeral/funeral director purposes; to help determine veterans eligibility status; to protect Presidential and other high-ranking officials; and for reporting to correctional institutions/law enforcement officials acting in a custodian capacity. There are also several types of uses or disclosures of PHI that the Plan may make without your authorization as long as, whenever possible, you are given an opportunity to agree or object before the Plan makes the use or disclosure. These exceptions are very limited and generally involve the release of a limited amount of PHI to aid your family members, close friends or disaster relief personnel in locating you in an emergency or in case of your incapacity. Will the Plan disclose my PHI to my employer? The Plan has the right to disclose your PHI to the Plan Sponsor, which is usually your employer or an affiliate of your employer, subject to certain limitations. The Plan may disclose to the Plan Sponsor information regarding whether you are enrolled in the Plan and "summary health information," which means information that summarizes the claims history and experiences of the individuals enrolled in the plan without specifically identifying you. The Plan may disclose this information without your authorization, and the Plan Sponsor may only use the information for its activities relating its sponsorship of the Plan. For example, the Plan Sponsor may use this information to seek bids from health insurers or to analyze its health plan expenses. If the Plan Sponsor needs more than "summary health information" or enrollment information to carry out its responsibilities, then documents that govern the Plan will determine the extent to which PHI may be used or disclosed, except that in no case may the Plan Sponsor use or disclose your PHI for employment-related decisions or for any other purpose other than as permitted by the Plan documents or by law. Do I have the right to request additional restrictions on the uses or disclosures of my PHI? Yes. You have the right to request additional restrictions relating to the Plan's use or disclosure of your PHI beyond those otherwise required under the HIPAA Privacy Rules. Although the Plan is not legally required to grant these requests, it is your right to make such a request. If you would like to make such a request, please contact the Plan's Privacy Officer.

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2015 Retiree Dental Insurance SPD

May I request that certain communications of my PHI be made to me at alternate locations? Yes. The Plan may communicate your PHI to you in a variety of ways, including by mail or telephone. If you believe that the Plan's communications to you by the usual means will endanger you or your health care and you would like the Plan to make its communications that involve PHI to you at an alternate location, you may contact the Plan's Privacy Officer to obtain the appropriate request form. The Plan will only accommodate reasonable requests and may require information as to how payment will be handled. Do I have the right to obtain access to my PHI? Generally, yes. You have the right to request and obtain access to your PHI maintained by the Plan unless an exception applies. The Plan may deny you access to your PHI if the information is not required to be accessible under the HIPAA Privacy Rules or other applicable law. For example, you do not have a right to access information compiled by the Plan in anticipation of or for use in a civil, criminal, or administrative proceeding. The Plan may charge you a reasonable, cost-based fee for copying as well as any postage costs and costs associated with preparing an explanation or summary of the PHI necessary to adequately respond to your request. If you would like to request access to your PHI, please notify the Plan's Privacy Officer. Do I have the right to request an amendment to my PHI? Yes. You have the right to request that the Plan amend your PHI. The Plan reserves the right to deny or partially deny requests for amendments that are not required to be granted under the HIPAA Privacy Rules. For example, the Plan may deny a request for amendment when the PHI at issue is accurate and complete or if the Plan is not the creator of the PHI. If you would like to request an amendment, please notify the Plan's Privacy Officer. Do I have the right to an accounting of disclosures of my PHI made by the Plan? Yes. You have the right to request and obtain an accounting of disclosures the Plan has made of your PHI. The Plan is not required to account for all uses and disclosures of PHI that the Plan makes. For example, the Plan is not required to provide an accounting for disclosures made for treatment, payment, or health care operations purposes or for disclosures made with your authorization. Additionally, the Plan reserves the right to limit its accountings to disclosures made after the compliance date of the HIPAA Privacy Rules. The Plan will provide you with your first accounting at no charge to you. If you request any additional accountings within a 12-month period, the Plan may charge you a reasonable, cost-based fee. If you request a subsequent accounting, the Plan will provide you with information regarding the fees, and you will have the opportunity to withdraw or modify your request if you wish to do so. Neither the Plan nor Business Associates is required to give you an accounting of disclosures made before April 14, 2003, the date the HIPAA Privacy Rules became effective. If I have an objection to the way my PHI is being handled, may I file a complaint? Yes. If you believe that the Plan has violated your privacy rights or has acted inconsistently with its obligations under the HIPAA Privacy Rules, you may file a complaint by contacting the Plan's Privacy Officer. The Plan requests that you first attempt to resolve your complaint with the Plan via these

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2015 Retiree Dental Insurance SPD

complaint procedures. If, however, you believe the Plan has violated your privacy rights, you may also file a complaint with the Office of Civil Rights at the United States Department of Health and Human Services by calling the Voice Hotline Number at 1-800-368-1019, or accessing it online at www.hhs.gov/ocr. It is against the policies and procedures of the Plan to retaliate against any person who has filed a privacy complaint, either with us or with the government. Should you believe that you are being retaliated against in any way, please immediately contact the Plan's Privacy Officer. May the Plan amend this Notice? Yes. This Notice is generally effective January 1, 2015. The Plan reserves the right to change the terms of this Notice at any time and to make the new Notice effective for all PHI maintained by the Plan. May I obtain a paper copy of this Notice? Yes. If you would like to receive a paper copy of this Notice, please contact the Plan's Privacy Officer. To request a copy of a particular Business Associate's privacy notice, if applicable, you should contact the Business Associate directly at the appropriate address listed in the table below. If you are...

Contact: Business Associate Address

Phone

Aetna

Legal Support Services Department 151 Farmington Avenue, W121 Hartford, CT 06156

1-860-952-8600

Enrolled in the CDHP, OOA or UnitedHealthcare MOFD options under Medical (UHC) or if you are a Participant in the Health Care FSA

Customer Service - Privacy Unit P.O. Box 740815 Atlanta, GA 30374-0815

1-800-765-6741

Enrolled in the Puerto Rico HMO

Humana Privacy Office P.O. Box 1430 Louisville, KY 40202

1-866-861-2762

Receiving prescription drug Express Scripts, Inc. management services provided under Medical (if you participate in an HMO, your HMO should be contacted to exercise your rights related to the prescription drug Provider)

Express Scripts, Inc. P.O. Box 66561 St. Louis, MO 63166-6561

1-800-791-8919

A Participant with a subrogation claim

Vengroff, Williams & Associates, Inc.

Vengroff, Williams & Associates, Inc. 2211 Fruitville Road Sarasota, FL 34237

1-941-363-5200 1-800-813-4054

Enrolled in the part-time

Aetna

Legal Support Services

1-860-952-8600

Enrolled in any of the Dental or DMO options

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Humana Health Plan (POS)

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2015 Retiree Dental Insurance SPD

If you are...

Contact: Business Associate Address

Dental option

Enrolled in the Vision option

Phone

Department 151 Farmington Avenue, W121 Hartford, CT 06156 EyeMed

EyeMed Vision Care, Attn: Privacy Officer P.O. Box 3104 Mason, OH 45050-7111

1-888-594-9834

What if I have additional questions that are not answered in this Notice? If you have any questions, concerns or issues relating to the privacy of your PHI that are not covered in this Notice, or if you want to file a complaint against a Business Associate or exercise your rights for PHI held by the Company, PowerLine or the Plan, please contact the Plan's Privacy Officer. How do I contact the Plan's Privacy Officer? You can contact the Privacy Officer by writing or calling: Health Plans Privacy Officer J. C. Penney Corporation, Inc. 6501 Legacy Drive Plano, TX 75024-3698 Telephone Number: (972) 431-8300

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2015 Retiree Dental Insurance SPD

ERISA Rights Statement The Employee Retirement Income Security Act of 1974 (ERISA) As Participants in the Plan, Employees, Surviving Spouses and their covered Dependents are entitled to certain rights and protection under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan Participants shall be entitled to: Receiving Information About Your Plan and Benefits 1. Examine, without charge, at the Plan Sponsor's office and at other specified locations, such as work sites or union halls, all documents governing the Plan, including insurance contracts and collective bargaining agreements and copies of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of Labor, and available at the Public Disclosure Room of the Employee Benefits Security Administration; 2. Obtain copies of all plan documents and other Plan information upon written request to the Plan Sponsor (the Plan Sponsor may make a reasonable charge for the copies); and 3. Receive a summary of the Plan's annual financial report. The Plan Sponsor is required by law to furnish each Plan Participant with a copy of this summary annual report. Continue Group Health Plan Coverage You may continue health care coverage for yourself, Spouse or Dependents if there is a loss of coverage under the Plan as a result of a qualifying event. You or your Dependents may have to pay for such coverage. Review this Summary Plan Description and the documents governing the Plan on the rules governing your COBRA continuation coverage rights. You are entitled to reduction or elimination of exclusionary periods of coverage for Pre-Existing Conditions under your group health plan, if you have Creditable Coverage from another plan. You should be provided a certificate of Creditable Coverage, free of charge, from your group health plan or health insurance issuer when you lose coverage under the plan, when you become entitled to elect COBRA continuation coverage, when your COBRA continuation coverage ceases, if you request it before losing coverage, or if you request it up to 24 months after losing coverage. Without evidence of Creditable Coverage, you may be subject to a Pre-Existing Condition exclusion for 12 months (18 months for late enrollees) after your enrollment date in your coverage. Prudent Actions by Plan Fiduciaries In addition to creating rights for Plan Participants, ERISA imposes duties upon persons who are responsible for the operation of the employee welfare benefit plan. The people who operate the Plan are called "fiduciaries" of the Plan and have a duty to do so prudently and in the interest of all Plan Participants. The law provides that fiduciaries that violate ERISA requirements may be removed. Obligations of Employees No one, including the Plan Sponsor or any other person, may exclude a Plan Participant or otherwise discriminate against or in any way prevent a Plan Participant from obtaining a welfare benefit or exercising his or her rights under ERISA.

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2015 Retiree Dental Insurance SPD

If a claim for a welfare benefit is denied, in whole or in part, the Plan Sponsor must provide the Plan Participant a written explanation of the reason for the denial. Plan Participants have the right to have the Plan Sponsor review and reconsider a claim. Conditions for Legal Action Under ERISA, there are steps Plan Participants may take to enforce the above rights. For instance, if materials are requested from the Plan Sponsor and the Plan Participant does not receive them within 30 days, the Plan Participant may file suit in a federal court. In such a case, the court may require the Plan Sponsor to provide the materials and pay the Plan Participant up to $110 per day until the materials are furnished, unless the materials are not furnished because of reasons beyond the control of the Plan Sponsor. If a Plan Participant has a claim for benefits that is denied or ignored, in whole or in part, the Plan Participant may file suit in a state or federal court. If it should happen that the Plan fiduciaries have misused the Plan's money or if a Plan Participant is discriminated against for asserting his or her rights, the Plan Participant should contact the U.S. Department of Labor for assistance or file suit in a federal court. The court will decide who should pay court costs and legal fees. If the Plan Participant is successful, the court may order the person sued to pay these costs and fees. If the Plan Participant loses (e.g., if the court finds the Plan Participant's claim to be frivolous), the court may order that he or she pay these costs and fees. If a Plan Participant has any questions about the Plan, he or she should contact the Plan Sponsor. If the Plan Participant has questions about this statement or about his or her rights under ERISA, he or she should contact the nearest area office of the Employee Benefits Security Administration, Department of Labor. The right is reserved in the Plan for the Plan Sponsor to terminate, suspend, withdraw, amend or modify the Plan in whole or in part, at any time, subject to the applicable provisions of the Plan. If the covered Employee has any questions about this statement or rights under ERISA, the covered Employee should contact the nearest area office of the Employee Benefits Security Administration, Department of Labor, listed in the telephone directory, or write to the Division of Technical Assistance and Inquires, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, Northwest, Washington, D.C. 20210.

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2015 Retiree Dental Insurance SPD

Key Terms Key Terms This is a collection of the definitions used throughout this SPD for Retiree Dental coverage. Appeal A way for you to have a denied claim for eligibility or benefits reviewed by the Benefits Administration Committee (BAC), the Claims Administrator or the Insurer. Associate, Employee, You Each person who is employed by JCPenney, and paid through the Company's or Participating Employer's payroll system. The term does not include a person covered by a collective bargaining agreement that does not expressly provide for participation in the Plan, provided that the Representative of the person with whom the collective bargaining agreement is executed has had an opportunity to bargain in good faith concerning Plan benefits. The term also does not include a person who is classified as an independent contractor by the Participating Employer for purposes of federal income tax reporting and withholding. The designation of an "Employee" by the Company shall be final and not subject to any redetermination of employment classification by any taxing authority such as the Internal Revenue Service or any other governmental authority or agency or arbitration committee. The term does not include any person who performs services for a Participating Employer as a "leased employee" within the meaning of Code § 414(n), or who performs services through an agreement with a leasing organization or by a similar arrangement. Benefits Administration Committee (BAC) A committee appointed by J. C. Penney Corporation, Inc. to act as the Plan Administrator for the benefit plans and programs. Certificate of Group Health Coverage A certificate showing the amount of time you were "continuously covered" under Retiree Dental or any other Creditable Coverage. "Continuously covered" means that you did not have a break in coverage of 63 or more days. Continuous coverage under Retiree Dental or any other Creditable Coverage will count toward any Pre-Existing Condition waiting periods that may apply. Civil Union Member A Retiree and a person of the same gender who are registered as being in a civil union under the laws of the state in which they reside. If requested, proof of the relationship satisfactory to the Plan Administrator must be provided. For purposes of BTA Insurance and AD&D Insurance, a "Civil Union Member" does not include a person on active duty in the military of any country.

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2015 Retiree Dental Insurance SPD

Claim Your request for coverage, eligibility, benefits or reimbursement of eligible expenses submitted to the Claims Administrator/Insurer. COB See Coordination of Benefits. COBRA The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) laws allow you and/or your eligible Dependents to continue your current coverage under Medical and Dental if your coverage ends for a reason specified in the regulations. See the Continuing Your Coverage Under COBRA section of this SPD for more details. Code The Internal Revenue Code of 1986, as amended, and the regulations that apply under the Code. Coinsurance The percentage of a covered expense that is shared by you and JCPenney. Company J. C. Penney Corporation, Inc. Coordination of Benefits (COB) The coordination of reimbursements between different health plan coverages you may have or be eligible for so that you do not receive duplicate payments for the same disability, illness or injury. Creditable Coverage The amount of time you have participated in a group health plan, including any continuous coverage identified on a Certificate of Group Health Coverage from a prior group health plan. Deductible The amount you must pay in a plan year before the Dental coverage will reimburse you for any covered expenses. There may be both an individual and a family Deductible. The following expenses do not count toward your annual Deductible (i) amounts above the level considered Reasonable and Customary (only applies if you receive services out-of-network), (ii) services not covered by the Dental coverage, (iii) prescription drugs purchased under the Prescription Drug Program under the Medical option, and (iv) charges above the maximum benefit provided for that type of service.

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2015 Retiree Dental Insurance SPD

Dependent One or more of the following persons: 1. A Retiree's Spouse or Domestic Partner; 2. A Retiree's, Spouse's or Domestic Partner's Child or Children who are under 26 years of age; or 3. An Incapacitated Child. If requested, proof of the relationship and the Dependent's status that is satisfactory to the Plan Administrator must be provided. "Child" means your, your Spouse's or your Domestic Partner's: 

Natural Child(ren);



Legally adopted Child(ren) (including a Child living with the adopting parents during the period of probation);



Child(ren) placed with you for adoption, provided that you assume and retain a legal obligation for total or partial support of such Child(ren) in anticipation of adoption, and such placement ends upon termination of such legal obligation;



Stepchild(ren);



Child(ren) to whom the Retiree, Spouse or Domestic Partner is the sole foster parent, courtappointed legal guardian, court-appointed legal custodian, or court-appointed managing conservator;



Grandchild (or grandchildren), niece(s), nephew(s) and/or sibling(s) if you have legal custody of the Child; or



Child(ren) for whom the Retiree, Spouse or Domestic Partner has received a court order requiring the Retiree to have the financial responsibility for providing health care coverage.

For the purpose of the Dental option, the definition of Dependent does not include any person who is a member of the armed forces of any country. The Plan Sponsor reserves the right to require whatever documentation necessary to establish such defined Dependent(s) satisfactorily to the Plan Sponsor. A Retiree may elect to be covered only as a Retiree or Surviving Spouse or as a Dependent, but not both simultaneously. If and when you terminate under the Dental option as a Retiree or Dependent, you will have a right to continue coverage under either definition that applies. Domestic Partner/DP Includes a person of the same gender who meets all of the following: (i) a Civil Union Member; (ii) a Registered Domestic Partner, and (iii) a Partner. For purposes of this definition a "Partner" means a person of the same gender for whom, with respect to the Retiree, all of the following are true: (i) the Retiree and other person have been in an exclusive committed relationship for the last 12 months; (ii) the

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2015 Retiree Dental Insurance SPD

Retiree and other person are neither married to anyone else nor a Partner of anyone else; (iii) the Retiree and other person are not related by blood to a degree that would prevent marriage in their state of residence; (iv) the Retiree and other person are each age 18 or over and competent to contract in their state of residence; and (v) the Retiree and other person are jointly responsible for the common welfare of each other. In addition, at least two of the following must be true: (i) the Retiree and other person have joint ownership of a residence; (ii) the Retiree and other person have at least two of the following: (a) joint ownership of a motor vehicle, or (b) joint checking account, bank or investment account, or (c) joint credit account, or (d) lease showing both Retiree and the other person as tenants, or (e) driver's licenses listing a common address; (iii) the Retiree and other person have designated each other as beneficiaries on their wills and/or life insurance policies; or (iv) the Retiree and other person have obtained a Domestic Partner or Civil Union Certificate from a jurisdiction other than their state of residence. If requested, proof of the relationship satisfactory to the Plan Administrator must be provided. For purposes of BTA Insurance and AD&D, a "Partner" does not include a person on active duty in the military of any country. ERISA The Employee Retirement Income Security Act of 1974, as amended, and the regulations that apply under that Act. ERISA is the federal legislation that regulates retirement and employee health and welfare benefit programs maintained by employers. Explanation of Benefits (EOB) A statement provided by the insurance carrier to you and your provider that explains: 

The benefits provided (if any);

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The allowable reimbursement amounts;

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Deductibles;

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Coinsurance;

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Any other reductions taken;

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The net amount paid by the Plan; and

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The reason(s) why the service or supply was not covered by the Plan.

HIPAA The Health Insurance Portability and Accountability Act of 1996, as amended, and the regulations issued thereunder. Reference to any section or subsection of HIPAA includes references to any comparable or succeeding provisions of any legislation that amends, supplements or replaces such section or subsection. Incapacitated Child An unmarried person who has the same principal place of abode as the covered Retiree for more than one half of the plan year, and who does not provide over one half of his or her own support for the plan year, and (i) who is not able to earn a living (i.e., earnings from wages must be less than the poverty threshold income level for a single person living alone as published by the U.S. Department of Commerce Bureau of the Census) because of mental retardation, any other mental handicap (e.g., severe chronic

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2015 Retiree Dental Insurance SPD

emotional problems, psychosis, autism or behavior problems secondary to organic brain disorder), or a physical handicap, and (ii) who is related to the Retiree as a child but became mentally or physically handicapped prior to the last day of the month in which the child turns age 26. If requested, proof of the relationship satisfactory to the Plan Administrator must be provided. Insurer The insurance company or companies issuing the Policy or Policies. JCPenney J. C. Penney Corporation, Inc. as well as any subsidiary or affiliate of J. C. Penney Corporation, Inc. that is a Participating Employer in the Plan. Network A group of dentists that agree to provide services at negotiated rates to people who belong to certain options. Because the fees are pre-set, the cost for in-network care is lower. Participant Someone who has satisfied all eligibility and enrollment requirements for participation in a plan, and whose participation has not terminated or whose coverage has not ended. Participating Employer Any subsidiary or affiliate of J. C. Penney Corporation, Inc. that is designated as a Participating Employer by the Human Resources Committee. Participating Employer excludes any division of the J. C. Penney Corporation, Inc. or a subsidiary or affiliate that is designated by the Human Resources Committee as not eligible to participate. See the ERISA Disclosures About Your Benefits section of this SPD for a list of Participating Employers. Pre-Existing Condition A sickness or physical condition that, within the six-month period prior to the effective date of your certificate, either: 

Resulted in your receiving medical advice or treatment; or

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Caused symptoms for which an ordinarily prudent person would seek medical advice or treatment.

Pre-Treatment Estimate (Pre-Determination) Advance notice of what expenses Dental will consider for reimbursement before work is begun.

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2015 Retiree Dental Insurance SPD

Primary Care Dentist (PCD) A dentist who is responsible for providing and managing all your dental care. When you are enrolled in the DMO, you and each covered family member must choose a PCD. All your dental care, except orthodontia, must be coordinated through your PCD (or a specialty dentist for orthodontia). Protected Health Information (PHI) Protected Health Information as defined under the regulations promulgated under HIPAA. Reference to any section or subsection of HIPAA includes reference to any comparable or succeeding provisions of any legislation that amends, supplements or replaces such section or subsection. Qualified Medical Child Support Order (QMCSO) A final court or administrative agency order that requires you or the other parent or guardian to provide health care coverage for Children after a divorce or Child custody proceeding. See the Qualified Medical Child Support Orders (QMCSO) section of this SPD for more information. Reasonable and Customary (R&C) A range of fees typically charged by most Dental Providers in your area. R&C applies to all dental services — including cleanings, X-rays, fillings, dentures, and oral surgery. Network dentists automatically charge R&C for their services. Dentists outside the Network may charge more than R&C. Before you have dental work, you can call Aetna to find out in advance if the charge will be R&C. You will have to pay any charges that are more than the R&C costs. Registered Domestic Partner A Retiree and a person of the same gender who are registered as Domestic Partners under the laws of the state in which they reside. Representative A person you authorize in writing to act on your behalf. The Plan will recognize a legally valid power of attorney or court order giving a person authority to act on your behalf. In the case of an urgent care claim, a doctor or other health care professional with knowledge of your health condition may act as your Representative. Special Enrollment Right A special 60-day enrollment period for health care coverage if you are otherwise eligible to participate and: 

You get married, form a partnership or acquire a Child through birth, adoption or placement for adoption.



You, your Spouse/DP or your Child did not enroll when first eligible because you had other coverage, and then lose your other coverage because of:

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2015 Retiree Dental Insurance SPD



Loss of eligibility due to legal separation, termination of a partnership, divorce, death, termination of employment or reduction in hours worked;

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Your COBRA coverage under another employer's group health plan ends; or

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The other employer stops making or decreases contributions for your coverage.

See “Special Enrollment Rights” under the Coverage section of this SPD for more information. Spouse The individual to whom an Associate (or a Retired or Disabled Associate) is legally married under the laws of the state (within the meaning of §3(10) of ERISA) or jurisdiction in which the marriage was celebrated. You The eligible JCPenney Retiree. Also includes "your" and "yours."

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2015 Retiree Dental Insurance SPD