Benefits UpdateGet Ready for 2011

December 2010NIN: 78-22637

Distributed to retired bargained employees of Legacy AT&T IBEW and CWA (including Puerto Rico) who retired on or after March 1, 1990, any associated retired nonmanagement nonunion employees, and any associated LTD recipients, survivors of retirees and COBRA participants.

The new year is just around the corner. Take a moment to review the important benefits updates and reminders in this communication.

This information will help you get the

most out of your benefit plans

and programs.

Where to Go for More InfoYour One-Stop Shop for contacting your Benefits Administrators

Got a question about an employee benefit? The best way to get answers is to contact your administrators directly. AT&T provides contact information for all of your benefits administrators in one location — the Where to Go for More Info website. To access the website, go online to access.att.com. Click on Your Benefits, and then click on Where to Go for More Info.

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ContentsGetting Ready for 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Maximize Your Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Important Reminders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Getting Ready for 2011Medical Transition of Care May Apply to YouThis change applies to those enrolled in the Point of Service (POS) option during 2010.

If you are enrolled in your company-sponsored medical plan and your claims administrator is changing in 2011, the following transition of care guidelines may apply. Please review them carefully.

If you or a covered family member is undergoing medical treatment and/or planning for surgical services that will continue after Dec. 31, 2010, or are planned for 2011, you may need to take the following steps to ensure transition of care:

Step 1: Verify that your current treating provider also is a member of the UnitedHealthcare (UHC) Choice Plus network to receive the highest level of coverage under the plan. If your provider is a member of the network, there are no further actions you need to take.

Step 2: If your treating provider is not in the network, contact UHC at 877-506-7221 to apply for transition of care benefits after you have enrolled.

Step 3: You and your provider must complete a transition of care application form and submit it for consideration. Applications must be received by Jan. 31, 2011, to find out whether you meet the criteria for transition of care benefits.

Step 4: Wait to receive your written confirmation from the administrator. This will be sent to you once your application is approved.

This document was written to make it easier to read. So, sometimes it uses informal language, like “AT&T retirees,” instead of precise legal terms. Also, this is only a summary, and your particular situation could be handled differently. More specific details about your benefits, including eligibility rules, are in the summary plan descriptions (SPDs), summaries of material modifications (SMMs) or the plan documents. In the event of a discrepancy, the plan documents always govern, and they are the final authority on the terms of your benefits. AT&T reserves the right to terminate or amend any and all benefits plans, and your participation in the plan is neither a contract nor a guarantee of future employment.

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If your current treating provider is not a member of the UHC network, and if your application is not approved for transition of care benefits, your claims for 2011 services will be paid at the non-network level of benefits, resulting in higher out-of-pocket expenses.

If you have questions about transition of care, call UHC at 877-506-7221.

TRANSITION OF CARE – QUALIFYING HEALTH CONDITIONS*End-stage renal disease (ESRD) and dialysis (applied to the physician or other provider, or dialysis center)

Nonsurgical cancer therapies, including chemotherapy and radiation

Pregnancy, regardless of trimester, through postpartum follow-up visit

Symptomatic AIDS

Transplants (solid organ and bone marrow)

Conditions where federal law requires transition of care

*For the period of Jan. 1 through March 31, 2011

Don’t Forget to File Your Medical Claims by the DeadlineIf you are enrolled in a non-HMO-type coverage option and your claims administrator is changing for 2011, please remember to:

File all medical claims for services received on or before Dec. 31, 2010, with your current medical claims administrator.

File all medical claims for services received on or after Jan. 1, 2011, with your new 2011 medical claims administrator.

To locate your medical claims administrator’s contact information, visit the Where to Go for More Info website and click on the Your Health tab.

Use of Primary Care Providers (PCPs)You may access care directly from a family practitioner, an internist, a pediatrician for your children or an obstetric or gynecology provider without obtaining prior authorization or a referral. If you enroll in company-sponsored medical coverage that includes a network option, make sure all providers, labs or facilities you are using participate in your medical claims administrator’s network to receive the highest level of coverage. This can be done by visiting the administrator’s website or by calling the number that is included on the medical ID card. If you do not have a network option available to you, you can access care from a licensed health care provider as defined in your plan.

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It is always a good idea to contact your medical claims administrator before receiving any treatment or service to determine whether it would be covered under your medical plan. Some plans still require precertification or preauthorization before receiving some services. If you have questions about providers, contact your medical claims administrator.

Medical ID Cards — TimingYou will receive a new medical ID card for 2011. Don’t worry if you don’t receive the new card before your first appointment in 2011. Your provider can use the information on your annual enrollment confirmation statement, which you were asked to retain for your records, to contact your claims administrator and verify your coverage.

You also may have the option of printing your medical ID cards online at your claims administrator’s website. Not all medical providers offer this option. Locate your claims administrator’s contact information on the Where to Go for More Info website. Simply go online to access.att.com. Click on Your Benefits, and then click on Where to Go for More Info.

Mental Health/Chemical Dependency (MH/CD) Transition of Care May Apply to YouThis article applies only to retired employees of Legacy AT&T Puerto Rico.

New MH/CD Claims Administrator for 2011

Beginning Jan. 1, 2011, if you are enrolled in the Basic Medical Plan (PRI), ValueOptions will become your MH/CD claims administrator. If you or a covered family member is receiving MH/CD treatment before Jan. 1, 2011, and the treatment will continue past Dec. 31, 2010, you must determine whether your provider is a member of the ValueOptions network to receive the highest level of coverage under the plan.

If your provider is not a member of the network, you must apply for transition of care and your request must be received before Jan. 31, 2011, for review and approval. To do this, call ValueOptions at 800-554-6701, or visit www.achievesolutions.net/att. Claims incurred in 2010 should be submitted through your current administrator, CIGNA Behavioral Health.

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Prescription Drug Copayment DeadlinesThis does not apply to U.S. expatriates or inpatriates, or those enrolled in HMOs.

For the 2010 copayment and deductible amounts to apply, you must submit eligible prescription drug orders or refills according to the following guidelines:

Mail Order/FastStart

CVS Caremark must receive mail orders for new prescriptions or refills by 11 a.m. Central time on Dec. 30, 2010. Responses from your physician for any prescriptions requested through FastStart must be received by 11 a.m. Central time on Dec. 30, 2010. Please note: You may want to allow additional time when mailing in prescriptions around the holidays.

Retail Pharmacy

Prescription drugs purchased at a retail pharmacy must be purchased by 11:59 p.m. Central time on Dec. 31, 2010.

IVR and the Internet

IVR and Internet refill orders must be completed by 11:59 p.m. Central time on Dec. 31, 2010. You will receive confirmation from CVS Caremark that your IVR and/or Internet refill order is complete.

Telephone

Telephone refill orders made through a service associate must be completed by 11 p.m. Central time on Dec. 31, 2010. You will receive confirmation from the service associate that your refill order is complete.

Health Reimbursement Account (HRA) Claim Filing DeadlineThis article applies only to those enrolled in a company-sponsored medical plan who are eligible for the HRA.

Claims for reimbursement for 2010 expenses must be submitted and received by the claims administrator by March 31, 2011. Any unused funds in your account will carry over for your use in 2011.

Claim forms may be requested from SHPS, the claims administrator, on its website at www.myshps.com or by calling 800-283-3211 (hearing impaired: 800-952-0450). You also may check your account balance by calling SHPS or by checking the SHPS website.

The earliest date that a

prescription is eligible to be

refilled is printed on your mail

order label. You also can visit

the CVS Caremark website at

www.caremark.com for your

next fill date. Prescription

drugs not eligible to be refilled

until Jan. 1, 2011, or later will

be processed under the 2011

copayment and deductible

amounts, regardless of when

the refill order is placed.

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Note About HRA and the Special Benefits Enrollment Opportunity

If you are eligible for the HRA in 2011, there will be a delay with the funding of your account as a result of the special enrollment opportunity (see page 8). Because HRA eligibility is determined by the medical plan option and tier (individual or family) you choose, AT&T must wait until the special enrollment period has ended to determine your 2011 HRA amount.

Maximize Your BenefitsPreventive Care Services When health problems arise, it’s best to catch and treat them as early as possible. Preventive care services help you do just that — stay on top of your health and identify concerns early. These services include routine wellness screenings and exams. Nonpreventive services, on the other hand, are considered treatment or diagnosis for an existing illness, injury or condition.

There may be limits on how often you can receive preventive care services. Depending on the situation, services might be considered preventive or nonpreventive. Always consult with your health care provider to clarify the type of service you’re receiving.

Here are just a few examples of preventive care services:

Annual routine physicals

Pap smears

Cholesterol screenings

Some immunizations

Mammograms

Well-baby and well-child care

This isn’t a comprehensive list. For more information on what services qualify as preventive care, contact your claims administrator.

CarePlus Covered Procedures and ServicesThis article applies only to those enrolled in CarePlus.

If you are enrolled in CarePlus, you can view the list of procedures and services currently covered in your CarePlus SMMs on the AT&T Benefits Center website or by calling UnitedHealthcare. The list is updated periodically. For more information about CarePlus, or if you have questions concerning the list or the process for obtaining preapproval, contact UnitedHealthcare at 877-261-3340. Customer service representatives are available Monday through Friday from 7 a.m. to 7 p.m. Central time.

If you enroll in the POS option,

eligible preventive care

services are covered at

100 percent when you

receive them from network

providers. Contact your

claims administrator for more

information. If you do not

have a network options,

preventive care services are

covered at 100 percent.

Special CarePlus Enrollment OpportunityBeginning Dec. 27, AT&T is holding

a special enrollment period so you

can take advantage of new covered

services added to CarePlus. Watch

for more information announcing

the special enrollment period and

details about these new services

coming soon!

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Important Reminders Health Care Reform Special Enrollment OpportunityYou should have received (or soon will receive) a notice from AT&T called “Special Benefits Enrollment Opportunity.” This notice provides important information regarding a special enrollment opportunity for employees and retirees to enroll eligible dependents for medical coverage, and CarePlus (if eligible) up to age 26, as well as to re-enroll in coverage if you or a dependent previously exceeded a lifetime maximum under your medical coverage. If you do not receive this notice by Dec. 23, 2010, visit the AT&T Benefits Center website at http://resources.hewitt.com/att to read about the special enrollment opportunity.

Medicare Reminder It’s important to understand how Medicare works, to know when you become eligible and what steps you need to take to enroll. Being informed and making the right decisions can mean lower out-of-pocket expenses.

Your 2011 annual enrollment materials provided a wealth of information about Medicare, including what to do if you or a covered family member is Medicare eligible. For more information, refer to these materials, or contact your medical claims administrator at the number listed on your medical ID card.

Your Ability to Change Medical Options During the Year May Be LimitedThis article applies only to retirees in the Alternative Medical option who are not on long-term disability, survivors of retired employees or COBRA participants.

Depending on the medical plan option you chose during annual enrollment, the changes you’re able to make during the year may be restricted.

If you enrolled in the Alternative Medical Option during annual enrollment, you may move out of that coverage option anytime during 2011. Your new coverage will be effective the first day of the second month following your request.

If you are not Medicare eligible and you enrolled in your existing medical option (POS or TI), you will not be able to switch to a different coverage option during 2011 unless you experience certain qualified change-in-status events.

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Change-in-Status Events Late in the Year There are several big events that happen during your life — getting married or divorced, having or adopting a child, the passing of a loved one. And many of these situations qualify as change-in-status events under your health and welfare benefits plans.

If you’ve experienced a change-in-status event recently or anytime during the coming year, you must report the event to the AT&T Benefits Center within 31 days of the event because you may need to make changes to your coverage. If you do not take action within the 31 day time frame, you may not be able to make changes until the end of 2011. Follow these steps to make sure that you and your dependents are covered:

1. Report your change-in-status event within 31 days. Go to the AT&T Benefits Center website and click on the Health and Insurance tab. Then, select Change Your Coverage. Next, choose the life event that describes the reason for your change, and follow the online instructions. The site also will prompt you to update and confirm your coverage for the remainder of 2010, if applicable.

2. Review or make changes to your 2011 coverage after your change-in-status event appears on the site. Call the AT&T Benefits Center at 877-722-0020 to speak with a service representative to confirm or make changes to your 2011 coverage. Don’t assume the changes you made to your 2010 coverage will carry over.

Voluntary Benefits Through Marsh PersonalPlansRetired employees in Puerto Rico, the U.S. Virgin Islands and Guam are not eligible.

In addition to your company-sponsored benefits, you can take advantage of a variety of voluntary benefits offered at group rates through Marsh PersonalPlans, including:

Auto and homeowners insurance

Group legal services

Accident insurance

ID-theft product

Veterinary pet insurance

Cancer insurance

Financial-planning services

Learn more about these offerings by visiting the Marsh PersonalPlans website, www.volbenefitsadvisor.com.

The offerings available

through Marsh PersonalPlans

are not AT&T-sponsored

benefits plans, nor are they

subject to ERISA. AT&T has

no connection with or control

over them. The availability

of these services is not to be

considered an endorsement

by AT&T.

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Voluntary Benefits Enrollment Period in January

Although you can sign up for most of these voluntary benefits throughout the year, you will need to enroll for group legal services and financial-planning services in January. Your enrollment opportunity is Jan. 3–28, 2011. You will receive a reminder postcard before enrollment begins.

Stay in the Know With Retiree NewsKeep up with what’s happening around the company by signing up for AT&T Retiree News. Retiree News offers several email subscriptions tailored to your interests, whether you’re looking for company news, benefits information or the latest on what’s happening with the Pioneers. This program is specifically for our retirees who still receive benefits through the company.

Your newsletter subscription choices include:

Company News. Find out what we’re doing to achieve our vision: Connect people with their world, everywhere they live and work, and do it better than anyone else. You’ll also hear about industry trends and how you can help us win in the public-policy arena.

eBenefits. The easy, and green, way to receive the latest information about your benefits. When new info becomes available, you’ll receive it via email instead of your mail box. This includes summary plan descriptions, benefits updates and annual enrollment information.

Pioneer News. Learn about volunteer opportunities in and around your community.

Prefer to Refer. Get information about the AT&T customer referral program, and find out how you can earn reward points by using and referring others to AT&T products and services.

Follow these simple steps to get started:

1. Go to access.att.com and log on. If this is your first visit to the site, click on the Retiree Registration link and follow the prompts.

2. After you log on, click on AT&T Retiree News.

3. On the subscription page, select the email newsletters you want to receive, enter your email address(es) and click Submit.

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Got Friends? Refer Them to AT&T!AT&T retirees can participate in the AT&T customer referral program, Prefer to Refer (P2R). When you refer family and friends to AT&T for their communications and entertainment needs, you can earn up to $599 in P2R Reward Points each year.

P2R is an easy, effective way to help people you know get best-in-class AT&T products and services while you earn rewards. Everyone benefits — you, the company and the customers you refer!

You don’t need any special knowledge or expertise to participate in the program. The only requirement is a desire to let family and friends know that AT&T has the products and services to meet their communication and entertainment needs. When you refer them to P2R, the experts at P2R will discuss details and offer solutions.

How to get started:

1. Obtain a personal P2R Login ID and password so you can access the website. To do this, contact P2R Rewards Customer Service at 1-866-REW-4-ATT (1-866-739-4288) Monday through Friday, 7 a.m. to 9 p.m. Central time. A valid email address is required.

2. Next, visit the P2R referral website at https://p2r.att.com to learn more about the program, including how to submit referrals, check the status of your referrals and redeem your points.

Also consider signing up for the P2R option on AT&T Retiree News to receive ongoing communications and available retiree perks. Go to http://access.att.com and choose AT&T Retiree News.

AT&T Inc.and Participating Companies

Human Resources-BenefitsP.O. Box 460582St. Louis, MO 63146

Forwarding Service Requested

NIN: 78-22637