Last Fall, the Trustees of the NASI Welfare Fund advised you of our efforts to pursue Blue Cross and Blue Shield to gain access to their national network of doctors and hospitals. For the most part, our efforts have succeeded.

Effective May 1, 2003 all persons eligible for benefits under the National Automatic Sprinkler Industry (NASI) Welfare Fund (except for residents of the State of Alabama) will be enrolled in the BlueCross BlueShield ("BCBS") national PPO network. As of May 1, 2003, the NASI Welfare Fund will no longer use the various PPO networks previously available to you. BCBS is widely regarded as the most recognized network of health care providers in the world. More than 85% of all doctors and hospitals throughout the United States currently contract with BCBS.

The BCBS PPO network gives you and your family access to doctors and hospitals almost everywhere, giving you peace of mind that you will always find the care you need. To find a doctor, hospital or other medical provider in the BCBS PPO network, visit the website or call 1-800-810-BLUE (2583).

There will be no change in benefits for members and dependents covered under the Plan in the BCBS PPO network. Health care benefits will continue to be provided by the NASI Welfare Fund and they will continue to be administered by the Fund Office in Landover, Maryland. Any 2003 deductible you met before May 1st will apply to you for the rest of the year.

Active participants and retirees not eligible for Medicare will be receiving new NASI Welfare Fund/BlueCross BlueShield medical identification cards in April. Your old identification card will not be valid after April 30, 2003. Beginning on May 1, 2003 you should use your new BlueCross BlueShield identification card. Medicare eligible retirees may continue to use their old ID cards and do not need to use PPO doctors and hospitals. Medicare already deeply discounts doctor and hospital bills and the Trustees do not wish to interfere in that process.

The BlueCross BlueShield card will include the participant's name, identification number, plan name and group number. On the back will be complete instructions for medical providers and members regarding verification of eligibility, filing claims and inquiries. Medicare recipients will continue to file their claims with Medicare first and then file any unpaid claims directly with the Fund Office for secondary coverage.

Because of the large number of medical providers in the BCBS PPO network throughout the nation, all Plan participants and their eligible dependents will be classified as "In Area" as of May 1, 2003 for benefit level determinations. Montana and Wyoming residents have access to the BCBS "Traditional Network" of doctors and hospitals. To insure that you receive the highest level of benefits under the Plan, be sure to use a BCBS PPO provider for medical services. If you do not use a BCBS PPO provider when one is available, the Plan requires that benefits be paid at lower levels (i.e., 60% of the usual and customary cost of covered services paid by the Plan with the balance payable by the patient). Of course, all Plan benefits are first subject to the applicable annual individual and family deductibles.

The Trustees could not come to terms with Blue Cross and Blue Shield of Alabama. Therefore, participants in Alabama will continue to have access to the Beech Street PPO.

The NASI Welfare Fund is using the BlueCross PPO network in California. When you contact BCBS to see if your doctor is in the network, they will know that you are accessing the BlueCross network and not the BlueShield network.

BCBS PPO network providers should be used for medical care services. The BCBS PPO network does not apply to dental care. Those with dental benefits may use any dental provider they wish. The following relationships will continue unchanged: Caremark for prescription drugs, Vision Service Plan, and National Ear Care.

The Trustees of the NASI Welfare Fund believe that this relationship with BCBS will provide greater access to preferred doctors and hospitals at an overall lower cost to the Fund and to you than was possible using the previous PPO networks. Issues with the telephones and claims processing at the Fund office are being addressed. The Fund office has taken steps that should assure that these items will no longer be issues in the very near future.