Loss aversion

Requested confirmation of number of members engaged with Case Management – 100%?

3% PCPM 9% medical trend less 6% 5.7% per Aetna report (JM)

ActiveHealth and Beginning Right Annual Savings Projections are based on ACS specific data Beginning Right savings calculation: Plan experienced a 42% drop in admissions per 1,000 and a 25% reduction in length of stay for NICU admits over 2007 Calendar Year. This resulted in a projected savings of $980,127 in 2008. **

Stores in West, Southwest, Rocky Mountain, Midwest and Mid-Atlantic U.S. and Western Canada Safeway, Vons, Pavillions, Dominicks, Genaurdi’s, Randalls, Carrs and Tom Thumb

74% of healthcare costs from disease linked to four chronic diseases Cardiovascular Cancer Diabetes Overweight/obesity And much is attributed to behavior and therefore preventable. Obesity contributes significantly to the cardiovascular disease and type 2 diabetes and is perhaps the single biggest driver of healthcare cost increase.

CDHP 2006 and active, health literate consumers 2007Health Risk Appraisal- Incentive, didn’t know their numbers House insurance to keep trend flat

How the brand ties into Culture of Health what COH means at Safeway what’s driving the need for it

Best Practices in Corporate Wellness: New Challenges, New Solutions Barry Hall – Buck Consultants Bernie Knobbe – ACS, a Xerox Company Dodi Kelleher – Safeway Inc. Lori Meaders – Southern California Edison Company Corporate Wellness Conference Los Angeles September 22, 2010

4th Annual Global Wellness Survey Objective: Assess trends in employer-sponsored wellness strategies and practices Participants: 1,245 participating employers 47 countries 15 million employees All industry categories Reports: Global survey report Executive summary in 8 languages To be released in October 2010 www.BuckSurveys.com 1

Workplace wellness is: Global Growing rapidly Becoming a business imperative 2

Location of Employees 3 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Global Prevalence of Health Promotion Programs 4 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Globalization of Strategy 5 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey * Covers majority of employees regardless of geography

Status of Wellness Strategy 6 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Employer Objectives Driving Wellness Strategy 7 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Cost Burden of Chronic Disease Source: DeVol R, Bedroussian A, et al., An Unhealthy America: The Economic Burden of Chronic Disease. The Milken Institute. Oct. 2007. 8

Health Issues Driving Wellness Strategy 9 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Key Challenges: Motivating/engaging employees Measuring impact Fostering a “culture of health” 10

Prevalence of Incentive Rewards (or Penalties) 11 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

12 Do Incentives Work? Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

13 Source: Taitel et. al, Journal of Occupational & Environmental Medicine, 2008. Maximize Results but Don’t Overpay

14 It’s Not Just About the Money Source: Seaverson et. al, Journal of Occupational & Environmental Medicine, 2009.

15 Loss Aversion: Leaving Money on the Table

Loss Aversion: Don’t Waste Prepaid Wellness 16

Regret Aversion: An Ounce of Prevention… 17

Statistical Optimism: Chances of Chronic Illness 18

Measurement and Outcomes 19 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Measurement and Outcomes 20 Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

Healthcare Cost Trend Impact 21 REDUCTION IN HEALTH CARE TREND RATE – U.S. EMPLOYERS AVERAGE ANNUAL REDUCTION IN HEALTH CARE TREND RATE – U.S. EMPLOYERS Preliminary (pre-publication) results from 2010 Global Health Promotion Survey

22 Building a “Culture of Health” EXTENT TO WHICH THE ORGANIZATION CURRENTLY HAS A CULTURE OF HEALTH 10% 23% 37% 22% 8% 5 = Very much so 4 3 2 1 = Not at All 33% 81%

Executive Summary: Return on Investment Analysis: 2008 Wellness Initiatives Fall, 2009

ACS: Global leader in information technology outsourcing, business processes, and problem solving.

ACS HR Services: Key Clients 25

Spanning the Globe: Centers of Excellence 14 Finance & Accounting | 12 Human Resources | 12 Mega Data Centers Arizona Washington Utah California Guatemala Illinois Michigan New Jersey Pennsylvania Kentucky Texas Mexico Jamaica Dominican Republic Canada Brazil United Kingdom Ireland Poland Switzerland France Spain Ghana India Malaysia China Philippines Fiji Georgia 39 Global Centers of Excellence | 500 locations worldwide | Global Production Model 26

Objectives Summarize historical wellness activities since program inception in 2006 Recap the Healthier Together wellness program initiatives from 2008 Highlight quantifiable financial impact to company and employee out-of-pocket healthcare expenses based on 2008 wellness program initiatives Consider Total Well-Being goals for 2010 -11, including metrics to measure quantifiable results to impact company and employee spend, employee and dependent engagement, and productivity 27

2008 Wellness Program Initiatives Initiatives through Aetna Partnership Simple Steps Health Assessment (Risk Profile) and Online Tools Healthyroads Lifestyle Coaching Program ActiveHealth Disease Management Program Beginning Right Maternity Program Case Management Program for coordinating care for members with more involved healthcare needs, such as cancer and stroke Support Initiatives through ACS Healthier Together wellness newsletter ACS Website Larry North webcasts, newsletter articles, and on-site visits Health fairs, lunch and learns, flu shots, and more 28

Wellness Programs Available to All Employees in 2008 Simple Steps Health Resources are available to all employees and dependents as a guide to understanding and managing health risks. Employees and dependents over the age of 18 who are enrolled in an ACS medical plan are eligible for Healthyroads lifestyle coaching program based on health risks identified through the Simple Steps Health Assessment. # Completed Health Assessments # Identified As High Risk Through Healthyroads # Successfully Completed or Are Currently Engaged with Healthyroads Coach* * As of 12/31/2008 29

Wellness and Condition Management Programs Available Through Partnership with Aetna* * Available for members enrolled in an ACS-sponsored PPO medical plan ** Assumes 50% participation 30

Wellness Management Programs Available through Aetna Partnerships 2008 was the first year that all programs were available to participants in ACS Medical Plans. The PPO medical plans became effective with Aetna, January 1, 2006. Programs included in the initial rollout were Simple Steps, Informed Health Line, Beginning Right, and Case Management ActiveHealth was rolled out in March of 2007 Healthyroads came on board April 1, 2008 The implementation of these programs resulted in a projected bottom line net savings for ACS of $ for 2008, in addition to substantially reduced out-of-pocket expenses for employees.** * Excludes expenses related to Larry North activities ** Employee savings projections for 2008 not available at this time. 31

$ Million* Decrease in Spend for Top 10 Disease States From 2007 to 2008 * Estimated savings reflected above are based on a #% reduction in medical claims expenses through Aetna. Actual savings calculations include increased medical cost trends of approximately #%, shifts in member headcount, and plan migration. #% of the 2008 decrease in spend, or $ million, is attributable to ActiveHealth activities. 32

$ Program Savings through Aetna Wellness Program Initiatives in 2008 1 # Members Identified for Outreach with ActiveHealth Nurse 2 Program implemented on April 1, 2008 3# Members Identified for Outreach by Healthyroads Lifestyle Coach 4 Healthyroads and Simple Steps savings projected by Aetna based on average wellness industry return on investment. 5 Fees assessed for online health assessment for non-Aetna members only. 6 Total Members Actively Engaged does not indicate unique members engaged. 33

Bottom Line Savings * Total ActiveHealth savings for 2008 was $. Of this amount, 86% ($) is included in the reduction in the Top 10 disease states claims. ActiveHealth savings that are not included with the Top 10 Disease States savings total $ of which $ represents employee savings. The total additional employer savings realized due to ActiveHealth activities is $. 34

2008 Wellness Initiatives ACS Wellness Website: ACS Wellness website updated monthly Available to all employees through InfoBank and through the world wide web Average over 7,000 views per month Healthier Together Monthly Newsletter: Distributed to all ACS employees via e-mail on a monthly basis Discuss a variety of health topics with focus on issues most relevant to ACS population Directs employees to view wellness articles on the ACS Wellness website Smoke-Free Environment: Effective January 1, 2009 47 locations nationwide 35

2008 Wellness Initiatives with Larry North Webcasts: Employees can view the live presentation online. Webcasts are recorded and uploaded to the ACS Wellness website for future viewing Average over 200 live viewers per webcast and over 700 viewers per recorded webcast Monthly Newsletter Articles: Each month, a newsletter article written by Larry North highlights various facets of leading a healthy lifestyle, including topics related to nutrition, exercise and fitness, and emotional well-being Average over 700 views per article On-Site Meetings: On-site meetings and health fair promotions were conducted at 5 locations throughout the United States in 2008 with approximately 1,500 attendees. “The number of employee testimonials reporting success in achieving healthcare goals continues to increase each month.” - Larry North 36

Wellness Initiative Program Milestones in 2008 Disease Management Claims Reduction ACS experienced an estimated medical claims reduction of $ for the Top 10 Disease States by Claims Dollars for our Aetna PPO plans in 2008. ActiveHealth Condition Management Program – Savings due to ActiveHealth condition management activities totals $, including $ in reduced medical claim costs for the Top 10 disease states and $ in employee savings, for an additional net employer savings of $ due to disease management claims reductions. Beginning Right Maternity Program NICU expenses decreased due to a 42% drop in admissions per 1,000 and a 25% reduction in length of stay from 2007 to 2008, resulting in an estimated savings of $ in 2008. Healthyroads Healthyroads lifestyle coaching program led to a savings of $ , as estimated by Aetna based on wellness industry standard return on investment, by motivating employees to make healthier lifestyle decisions. Simple Steps to a Healthier Life ACS offered a $200 premium credit in 2009 for medical plan participants who completed the Simple Steps Health Assessment in 2008. Over 30,000 employees completed the Simple Steps to a Healthier Life health assessment and/or used the Simple Steps online educational tools in 2008, resulting in an estimated savings of $. Case Management In 2008, Case Management saved ACS $ by working with physicians and healthcare facilities to help ensure proper care and reduced the length of hospital stays and ICU stays. 37

Healthyroads – Program Success in 2008 * Represents percentage of # Members who completed the applicable coaching program or who were actively engaged with a lifestyle coach as of 12/31/2008. 38

Well-Being Program Goals for 2009-10 Continually enhance our program structure to demonstrate increased savings through our Healthier Together wellness program Realize additional savings by increasing participation in wellness initiatives, including rewards to encourage healthy lifestyle choices and penalties for lack of engagement to change behaviors Partner with Larry North and ActiveHealth to develop the next generation of tools, resources, and communications to increase engagement, enhance business productivity, and proactively manage healthcare costs as they continue to increase nationwide More detail to be provided in the Plan Year 2010-11 Healthcare Strategy later this summer. 39

Details regarding our multi-year healthcare strategy to better define steps to creating a culture of total well-being will follow. Total Well-Being Timeline 40

Glossary of Terms ActiveHealth – Disease and condition management program to help individuals with targeted health conditions better manage their health risks Aetna Navigator – Personalized webpage for members to find health assessment information, claims information, etc. Beginning Right – Maternity program to decrease preventable high claims for at-risk pregnancies Case Management – Individual nurse case management for members with more involved healthcare needs, such as cancer, offered through Aetna Healthyroads – Healthy lifestyle coaching program offered through Aetna partnership Informed Health Line – Live Nurse Hotline and internet knowledgebase of information to help members make healthcare decisions, including whether an issue requires an ER visit or a physician’s office visit MedQuery – Electronic program to share care considerations, such as drug interactions, with physicians available through ActiveHealth. NICU – Neonatal Intensive Care Unit Simple Steps to a Healthier Life - Online program of resources to help members make more informed healthcare decisions, including an online health assessment Total Well-Being – Concept that ACS provides tools, resources, and opportunities to help employees and dependents develop a holistic approach to balancing work and life 41

Building a Comprehensive Health and Well Being Program Dodi Kelleher, DMH Director, Health & Wellness Initiatives September 22, 2010

Getting to Know Safeway One of the largest food and drug retailers in North America 200,000 employees and 1,725 stores across the US and Canada Network of distribution, manufacturing and food processing facilities GroceryWorks.com Safeway health benefits offered to 30,000 corporate and store employees Majority of union population receives benefits through labor trust funds, principally UFCW and Teamsters

Safeway’s Challenge Goal: Safeway seeks to provide high-quality, competitive health care benefits Problem: Rapidly escalating health care costs during the first part of this decade posed a threat to this objective Health care expenditures threatened to be twice as much as net income Solution: Multidisciplinary task force convened to understand cost-drivers and develop a solution

% Preventable / Manageable Four Chronic Conditions Comprise 74% of Disease Costs Cost Distribution by Disease State 74% of Costs 80% 30% / 60% 80% Nearly all Heart Type 2 can improve disease/ stroke Source: CDC, HHS, 2005 data, Safeway analysis

Solution: Safeway’s Programs Strong belief in the efficiency of markets and the power of pricing Knowledge that most health risks, conditions and costs are behaviorally based Confidence that employees can be informed consumers of health care and are willing to be held accountable for their actions

Healthy Measures Reductions to medical benefit premiums if employees show evidence of healthy behaviors Not smoking BMI below 30 No hypertension Healthy ranges for cholesterol and glucose Those who missed one or more of the goals earn retroactive rebate if they improve sufficiently by year end Provide support to set and meet goals

2009 Plan Year Testing Results Employees 75% participation 55% qualified for all 4 discounts 6% qualified for 1 or fewer discounts Spouse / Domestic Partners 51% participation 49% qualified for all 4 discounts 20% qualified for 1 or fewer discounts

Year Over Year Results Percent of Participants Passing in 2009 who did not Pass in 2008 No pass 2008 3,283 1,106 684 4,640 Pass 2009 1,326 336 118 746 Employees and Spouses

How Do We Provide Support Safeway Programs: Smoke-free campus Team health challenges Weight loss programs Healthy cafeterias On-site fitness center On site health clinic with NP Gym memberships Health assessment Programs designed to manage risks before they become health conditions

How Do We Provide Support Personal Health Team: Health and disease prevention information Outreach regarding health risks Coaching and condition management Active and structured collaboration Holistic bio-psycho-social approach Culturally aware Reportable outcomes Programs designed to help eliminate as well as self-manage health conditions

12.2% 17.9% 32.7% 28.6% 0.5% 8.2% Challenge 1 Initial BMI Challenge 2 Post BMI N=609 Shifting The Curve: Results for Participants in Both Team Challenges- May 2009 to May 2010 Obese Population = 23.8% 14% reduction in obesity 12% increase in normal BMI

Those Who Participate are Embracing the Changes When Healthy Measures participants were surveyed . . . 78% rated the program good, very good or excellent 76% of participants suggested more incentives to encourage healthy behavior When team challenge participants were surveyed . . . 80% were satisfied or very satisfied with the program and 78% agreed it had improved their health Over 80% said they were likely or very likely to participate in the next challenge and to encourage a co-worker to participate

What’s Next Culture = “How things get done around here” Attributes of a “culture of health” Corporate values reflect belief that workforce well-being is a business advantage Managers demonstrate consideration for employee health, well-being and safety in operational management and planning Employees believe leadership authentically cares about their well-being Employees take accountability for achieving good health Health = “Physical, emotional and financial well-being” Building a benefit brand to promote a “culture of health”

Our New Brand

Safeway AisleONE Benefits Portal A benefits portal for employees and covered spouses/ partners One-stop shopping experience… available through one URL with one password A “sticky” experience that engages employees Comprehensive site to support all aspects of a “Culture of Health”

AisleONE Overview Active Directory Identity Management Safeway PR H&W Content RSS Feeds Personalized Avatar & Dashboard Personalized Employee Cost Savings Personalized Spouse Dashboard News & Information Usage Statistics & Reporting …The Benefits Portal PeopleSoft Employee Data JP Morgan 401(k) Plan CIGNA Health Risk Assessment ACS BenefitsWeb Administration MedExpert Wellness Ektron Content Management Physicians Biometric Testing Quest Biometric Testing Personalized Employee To-Do Checklist

WELLNESS@EDISON Corporate Wellness Conference September 22, 2010

60 Long History of Wellness@Edison 1951-2000: On-site health clinics/pharmacy operations at 8 Edison locations 1989-2004: Good Health Rebate - $120 toward cost of health care coverage if participant w/in medically acceptable levels of five risk factors: weight, blood pressure, blood sugar level, cholesterol level and smoking 2004: Established Disability Board 2008: Evolved into Health and Productivity Board Expanded Purpose Organizational Integration Wellness Team

Build awareness in the organization of the total costs of avoidable health and productivity losses Maximize the benefits of staying at work and returning to work Monitor overall program costs to ensure projected ROI is met Commit to best practices in the areas of managing health and productivity Approve long-term health and productivity initiatives that complement the overall corporate strategy 61 Health and Productivity Board

Why Focus on Wellness? Estimated 70% of the dollars Edison spends in pharmacy and absenteeism are related to potentially preventable chronic health conditions Identifiable and Modifiable Health Risks (Health Risk Assessment Test – 2,053 unique people 2008 & 2009) 53% -- Unhealthy Weight 39% -- High Blood Pressure 22% -- High Cholesterol Healthier employees are less prone to injuries and have fewer accidents 62

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Wellness Framework Multi-tiered approach focusing on: Environment Nutrition Fitness Prevention Compliance Programs apply to most employees – represented and non-represented 64

Environment – Current Programs Wellness Ambassador Program Volunteer employee peer resource Promote health & wellness; motivate others 24/7 Health Matters portal site Employee and Retiree Communications Health Literacy Wellness tips, Web links, Reminders Ergonomics and Safety Programs Fitness For Duty Policy Return-To-Work Program Employee Assistance Program Health, Wellness & Safety Fairs 65

Environment – Developing & Future Programs Incorporate Health and Wellness vision into SCE vision, values and guiding behaviors Wellness Policy and Corporate Medical Policy Wellness website Launch Annual Wellness Ambassador Symposium Smoke Free campus Prescription and Over-the-Counter drug collection program 66

Nutrition – Current Programs Nutritional information presentations Cafeteria Healthy Choice options Vending Machines Healthy options Snack signage/guidance Weight Watchers program on site 67

Nutrition – Developing & Future Programs Improve and expand vending machine offerings Expand nutritional information program at cafeteria and vending machines Revise meeting catering menu selections – promote healthy choices Offer “lunch and learns” – healthy meal preparation workshops Facilitate Weight Watchers program across company locations Subsidize healthy food options Offer promotional days of free fruit/vegetable giveaways 68

Fitness – Current Programs Fitness Center Health & fitness specialists Personalized attention Large variety of classes Chair and table massages Discounted gym memberships at some locations WebMD – myHealthOnline Personalized website Health risk assessment (self-reported) Lifestyle Improvement Programs Preventative Health Account Reimbursement for health improvement (e.g. fitness, weight loss) 69

Fitness – Current Programs (cont.) Health Advocate Assist w/locating outside resources for weight mgmt & stress mgmt Tangerine Wellness Weight management incentive program Promote behavior change Cash awards WorkSteps Program Pre-employment physical Cost to operate pilot $150,000 Estimated avoided costs $915,622 Net ROI $765,622 $85,069 per person 70

Fitness – Developing and Future Programs Expand WorkSteps Program Fitness Center website Add new Fitness Centers Publicize internally and externally sponsored weekend fitness events Track employee physical activity and reward with a point based redemption system Walking program 71

Prevention - Current Vaccine clinics Executive Health Enhancement Program Pre-employment drug screens Lactation program Hearing conservation program Red Cross blood drives 72

Prevention – Current (cont.) Health plans 100% preventive coverage Online weight management, fitness & nutrition resource Disease mgmt – diagnose/treat before a condition worsens Promote lifelong healthy habits to improve quality of life for chronic conditions 73

Prevention – Developing & Future Programs Establish Corporate Wellness Center to offer on-site “routine” and preventative screenings to employees Provide on-site nutritionist Implement “Stress Management” program Develop programs that target workforce demographics to address workforce health risks 74

Compliance – Current Programs Medical Review Office for DOT and NRC OSHA medical monitoring DOT drug screens and physicals 75

WRAP UP 76