Take Action Before Your Enrollment Deadline

Your Total Rewards.Your Choices.Your Better Health.

It’s Your ChoiceMaking informed decisions about your healthcare coverage helps you get the most value from your plans. And now is your opportunity to choose your medical, dental and vision coverage, as well as additional benefits. We encourage you to take advantage of the tools you have available to help you select the coverage that works for your healthcare needs.

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Our Approach to Total Rewards

At McKesson, we’re committed to providing resources to help you live a happy and healthy life. We do this by offering competitive programs and opportunities to reward your contributions to our company’s success. We call these resources Total Rewards. Your Total Rewards include your base pay and programs that support your physical, mental and financial well-being, such as:

• Vitality, Quit For Life®, Weight Watchers® and the Employee Assistance Program (EAP).

• Savings and investment tools — the Profit-Sharing Investment Plan (PSIP), which is our 401(k) plan, and the Employee Stock Purchase Plan (ESPP).

• Assistance to help you achieve personal goals, such as adoption and higher education.

Our Total Rewards invest in your total well-being, and the choices you make during your enrollment period can positively affect your health and the health of our company. We encourage you to take advantage of all the Total Rewards we offer.

Learn more about your Total Rewards at McKNet > Pay & Benefits > Total Rewards.

HR Support Center855.GO.MCKHR (855.466.2547)Press 1 for the McKesson Benefits Center for Health, Vitality and Pension questions. Benefit experts are available 9 a.m. - 5 p.m. Central time. Oprime 1 para recibir asistencia en español a través del McKesson Benefits Center.

Call the HR Support Center if you have enrollment questions. If a benefit expert can’t answer your question, a Personal Health Advocate will contact you within 24-48 hours. Personal Health Advocates are specifically trained to help you with questions about medical, dental and vision coverage.

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What’s Inside

4 McKesson Benefits

5 Your Options at a Glance

6 Medical Plans

7 Medical Plan Accounts

8 Flexible Spending Accounts

9 Prescription Drug Coverage

10 Additional Medical Coverage

11 Dental

11 Vision

12 Supplemental Life and Accidental Death & Dismemberment

12 Long Term Disability

13 401(k)

13 Employee Stock Purchase Plan

14 McKesson-Paid Total Rewards

15 Additional Total Rewards

16 Enrollment Tools

17 Your Enrollment Checklist

18 Enroll on UPoint

19 Contacts

Your Effective Date of CoverageIf you’re a new full-time or part-time employee working 30 or more hours per week, your coverage is effective the first day of the calendar month following your date of hire (as long as you enroll within 31 days of the date printed on your New Hire Kit).

If you’re hired more than 31 days prior to McKesson’s Annual Enrollment period (generally in late October/November), you’ll need to elect benefits twicethis year: once within 31 days of the date printed on your New Hire Kit in order to receive benefits for the current year, and again during Annual Enrollment to continue (or change) your coverage for the following year.

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Eligible DependentsYour eligible dependents include:

• Your spouse, unless legally separated or divorced (including a common-law spouse if recognized in your state of residence), or your domestic partner.

• Your child or your domestic partner’s child under age 26 (regardless of whether that child qualifies as your “dependent” for tax purposes).

• Any unmarried child age 26 or older, if the child is mentally or physically disabled and dependent on you for maintenance and support. The child’s disabling sickness or injury must have begun prior to age 26.

McKesson-Paid Benefits — Automatic Enrollment

Plans Who Pays

• Basic Life

• Basic Accidental Death & Dismemberment (AD&D)

• Short Term Disability

• Vitality

McKesson pays the full cost

Optional Benefits — You Must Enroll to Participate

• Medical

• Dental

• Vision

• Long Term Disability

You and McKesson share the cost

• Employee Supplemental Life and AD&D Insurance

• Dependent Life and AD&D Insurance

• Flexible spending accounts (FSAs)

- Healthcare FSA

- Heath savings account-compatible FSA

- Dependent care FSA

You pay the full cost

Along with our 401(k) plan — the Profit-Sharing Investment Plan (PSIP) — we offer the Employee Stock Purchase Plan (ESPP) as part of your financial wellness resources. You'll be notified when you become eligible to enroll in the PSIP and ESPP (p. 13).

McKesson Benefits

You automatically receive certain McKesson-paid benefits as a member of our team. If you wish to participate in optional benefits — to which you contribute some or all of the cost — you must enroll during your enrollment period. Your coverage is effective the first day of the calendar month following your date of hire (as long as you enroll within 31 days of the date on your New Hire Kit cover letter).

About Enrollment

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Medical Plan CarriersIf you enroll in the HRA Core, HSA Plus or HSA medical plan, your choice of medical plan carrier depends on where you live. Before choosing your carrier, visit each carrier’s website to confirm that your preferred doctors and service providers are in-network. It’s also important to compare each carrier’s tools, resources and services. You may find you prefer one carrier over another.

AetnaAetna Choice POS II http://aetnaresource.com/8778/mckesson877.286.3900Available in all states except Hawaii.

AnthemNational PPO (BlueCard PPO) http://enrollment.anthem.com/McKesson866.820.0763Available in California, Florida, Michigan and Pennsylvania.

Cigna Open Access Plus, OA Plus, Choice Fund OA Plus www.cigna4mckesson.com800.244.6224Available in all states except Hawaii.

Qualified Status ChangeThe options you select during enrollment are for all of 2016 unless you experience a qualified status change, such as marriage or the birth of a child. If you have a qualified status change, you may update certain enrollment choices within 31 days of the change on UPoint under the Life Events tab.

Visit UPoint at http://resources.hewitt.com/mckesson to learn about the Health Insurance Portability and Accountability Act (HIPAA) Special Enrollment Rights that allow you to enroll in coverage outside of your enrollment period, if you qualify.

Medical

• HRA Core plan — comes with a health reimbursement account funded by McKesson.

• HSA Plus plan — comes with a health savings account funded by McKesson, and you, if you choose to contribute.

• HSA plan — comes with a health savings account you fund, if you choose to contribute.

• HMOs — these plans are available only in limited locations.

• EPOs — these plans are available only in limited locations.

Dental

• Cigna Dental Preferred Provider Organization (PPO) — you have two options, PPO and PPO Plus.

• Cigna Dental Health Maintenance Organization (DHMO).

Vision

Vision Service Plan (VSP) — you have two options, VSP and VSP Plus.

Flexible Spending Accounts (FSAs)

• Standard healthcare FSA — you can contribute $100 - $2,550 per year.

• HSA-compatible FSA — you can contribute $100 - $2,550 per year.

• Dependent care FSA — you can contribute $100 - $5,000 per year.

Supplemental Life and Accidental Death & Dismemberment Insurance (Life AD&D)*

You can choose to purchase coverage for yourself (employee only) and your spouse/domestic partner or child(ren).

Long Term Disability Insurance (LTD)

You can choose coverage for up to 60% of your covered pay during long periods of disability (up to $25,000 per month).

* UPoint will prompt you if Evidence of Insurability (EOI) is required for supplemental life and AD&D insurance.

Confirm that you’re tobacco free on UPoint to save on 2016 life insurance premiums.

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Your Options at a Glance

Your Choices

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Medical Plans

Our three primary medical plans feature:

• Comprehensive medical and prescription drug coverage.

• No-cost preventive care when using an in-network provider.

• Coinsurance after meeting your deductible. Coinsurance is the percentage of the cost you share with McKesson. When you receive in-network care or services, you pay 20% of the cost, McKesson pays 80%. If you receive out-of-network care, you pay 40% of the cost, McKesson pays 60%.

• Out-of-pocket maximums that limit how much you pay for medical and prescription drug expenses during the year. Out-of-pocket maximum is the amount you pay in annual deductible plus your share of eligible expenses before the plan pays 100%.

• Accounts to help you pay eligible expenses.

HRA Core Plan Key Features

Premium*

Health reimbursement account

Deductible

Coinsurance out-of-pocket max Out-of-pocket max

McKesson credit

EE contribution In-network Out-of-

network In-network Out-of-network

EE $22-$112 per month $750 N/A $2,125 $2,500 $5,000 $4,625 $7,125

EE + SP/DP or Child(ren)

$79-$315 per month $1,100 N/A $3,175 $3,750 $7,500 $6,925 $10,675

EE + Family $170-$451 per month $1,500 N/A $4,250 $5,000 $10,000 $9,250 $14,250

HSA Plus Plan Key Features

Premium*

Health savings account

Deductible

Coinsurance out-of-pocket max Out-of-pocket max

McKesson contribution

EE contribution** In-network Out-of-

network In-network Out-of-network

EE $22-$112 per month $750 $0-$2,600 $2,125 $2,500 $5,000 $4,625 $7,125

EE + SP/DP or Child(ren)

$79-$315 per month $1,100 $0-$5,650 $3,175 $3,750 $7,500 $6,925 $10,675

EE + Family $170-$451 per month $1,500 $0-$5,250 $4,250 $5,000 $10,000 $9,250 $14,250

HSA Plan Key Features

Premium*

Health savings account

Deductible

Coinsurance out-of-pocket max Out-of-pocket max

McKesson contribution

EE contribution** In-network Out-of-

network In-network Out-of-network

EE $3-$10 per month N/A $0-$3,350 $3,500 $2,750 $5,500 $6,250 $9,000

EE + SP/DP or Child(ren)

$5-$24 per month N/A $0-$6,750 $5,250 $4,125 $8,250 $9,375 $13,500

EE + Family $9-$34 per month N/A $0-$6,750 $7,000 $5,500 $11,000 $12,500 $18,000

** Premiums vary by your pay and the maximum savings earned by participating in Vitality, a voluntary health and wellness program (p. 14).** Contributions to a health savings account are voluntary. You choose how much to contribute, up to the IRS limit (p. 7).

Medical

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HSA Plus and HSA PlanHealth savings account • You own the account and can choose to make before-tax

contributions through payroll deductions. Health savings account dollars can be used to pay eligible medical, prescription drug, dental and vision expenses.

• McKesson makes account contributions under the HSA Plus plan (p. 6). If you were hired between January 1 and March 31, McKesson contributes half of the contribution amount as soon as administratively possible after the first day your HSA Plus coverage begins, and the other half in April.

• If you were hired on or after April 1, you receive the full McKesson contribution amount as soon as administratively possible after the first day your HSA Plus coverage begins.

• Under the HSA plan, McKesson doesn’t contribute to your health savings account.

• Your total annual contribution, including dollars funded by McKesson under the HSA Plus plan, cannot exceed the IRS limits shown in the chart below.

Annual IRS Contribution Limits for 2016 Health Savings Accounts

Individual Coverage Family Coverage

$3,350 $6,750

$1,000 for additional catch-up contributions (age 55 or older)

Medical Plan Accounts

Each of our primary medical plans comes with an account that can save you money on healthcare expenses. Knowing which account works for you is key to choosing the right medical plan. Keep the following plan account differences in mind.

Compare examples of how the accounts cover expenses at www.mckesson.com/totalrewardslibrary > New Hires > How the Medical Plan Accounts Work (New Hires).

Medical

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HRA Core Plan Health reimbursement account• McKesson owns and credits the account.

• The amount McKesson credits depends on who’s covered under your plan (p. 6). McKesson credits the account on the first day your coverage begins.

• Your medical plan carrier administers the account.

• Account dollars are automatically applied to eligible medical and prescription drug expenses, and count toward your deductible.

• Under the HSA Plus or HSA plan, you decide how and when to spend your account dollars. You can use your health savings account debit card to pay eligible healthcare expenses at the time you receive services, or you can pay out of pocket and reimburse yourself from your account dollars later. Eligible healthcare expenses include medical, prescription drug, dental and vision expenses, as well as a variety of expenses not normally covered by your medical plan, such as fertility treatments, LASIK surgery and even guide dogs.

See examples of eligible expenses at www.mckesson.com/ totalrewardslibrary > Flyers > Health Savings Account Qualified Expenses.

• Eligible expenses paid with your account dollars are applied toward your medical or dental plan deductible.

• Once your account balance reaches $500 or more, you can use your account as an investment tool — similar to a 401(k) — to help you reach your long-term financial goals.

• Fidelity administers your account, and McKesson pays the Fidelity administration fees as long as you work at McKesson.

• Account dollars carry over to the following year and are yours to keep, even if you change medical plans, leave McKesson or retire.

Learn more at www.mckesson.com/totalrewardslibrary > Flyers > Health Savings Account Overview.

• Account dollars don’t carry over to the following year — you lose any account dollars you don’t use by December 31 of the calendar year in which the dollars were credited to your account.

• You lose your account dollars if you change medical plans, leave McKesson or retire.

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Other FSA Considerations• If you don’t enroll in one of our primary medical plans, you may still be eligible to enroll in FSAs.

• FSA dollars don’t carry over from one calendar year to the next. Carefully consider your healthcare and dependent care needs before deciding on a contribution amount.

• You can pay for your eligible expenses using your WageWorks® Healthcare Card (similar to a debit card), by filing a claim for reimbursement on the WageWorks website or using the EZ Receipts® mobile app. Be sure to keep all your FSA receipts for verification purposes.

Learn more at www.mckesson.com/totalrewardslibrary > Flyers > Flexible Spending Account Overview.

Standard healthcare FSA HSA-compatible FSA Dependent care FSA

Available to HRA Core plan members

HMO and EPO plan members

All benefit eligible employees not enrolled in the HSA Plus or HSA plan.*

HSA Plus plan members

HSA plan members

All benefit eligible employees

Use for Eligible medical, prescription drug, dental and vision out-of-pocket expenses, including deductible and coinsurance amounts

Eligible dental and vision out-of-pocket expenses only, including deductible and coinsurance amounts

Eligible child care and eldercare out-of-pocket expenses

List of eligible expenses

www.mckemp.com/SHFSA2016

www.mckemp.com/HSAFSA2016

www.mckemp.com/DEPFSA2016

Contribution amounts $100 - $2,550 $100 - $2,550 $100 - $5,000

* If you’re covered under your spouse/domestic partner’s high-deductible health plan and wish to make health savings account contributions in 2016, don’t contribute to a standard healthcare FSA. Contributing to a 2016 standard healthcare FSA disqualifies you and your spouse/domestic partner from making health savings account contributions.

Flexible Spending Accounts

One of the ways we help you take control of your healthcare spending is with the opportunity to enroll in flexible spending accounts (FSAs). FSAs allow you to use before-tax dollars to pay for eligible healthcare and dependent care expenses. There are three FSAs to choose from, all administered by WageWorks. In some cases, the type of FSA you can participate in depends on your medical plan, as shown below.

Medical

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Chronic Condition Medication Discount Program

HRA Core plan members may be eligible to earn discounts on certain chronic condition medications by participating in the Chronic Condition Medication Discount Program and access Condition Support Managers who can help you understand your health condition. Contact your medical plan carrier (p. 19) to connect with a Condition Support Manager.

HSA Plus and HSA plan members aren’t eligible for the Chronic Condition Medication Discount Program. However, as an HSA Plus or HSA plan member, you can access Condition Support Managers who can help you understand your health condition. Contact your medical plan carrier (p. 19) to connect with a Condition Support Manager.

Best Doctors

Best Doctors is a second opinion service that gives you access to expert medical advice from some of the world’s leading physicians. Contact Best Doctors if you’re unsure of a diagnosis, have concerns about the medications you’re taking or want to know if a medical procedure is right for you. You’re eligible to use Best Doctors when you enroll in a McKesson medical plan. Learn more at www.mckesson/totalrewardslibrary > Flyers > Best Doctors Medical Advice.

Best Doctorshttps://members.bestdoctors.com866.904.0910 7 a.m. - 8 p.m. Central time, M-F

Step Therapy

Step therapy requires that you try cost-effective medications before purchasing, or “stepping up” to more expensive medications. CVS Caremark identifies first, second and third choice medications:

• Cost-effective drugs are first choice medications.

• Preferred brand name drugs are second choice medications.

• Non-preferred brand name drugs are third choice medications.

You and your doctor make the final decisions about which medications are right for you. Coverage will be available for more expensive medications if your doctor and CVS Caremark agree that there is a medical reason a lower-priced medication isn’t appropriate for your condition. You can learn more about step therapy at www.mckesson.com/totalrewardslibrary > Flyers > Prescription Drug Overview.

Prescription Drug Coverage

CVS Caremark is your carrier for outpatient prescription drug coverage whether you enroll in the HRA Core, HSA Plus or HSA plan. Under our three primary medical plans, your prescriptions are paid as any other eligible expense, subject to your annual deductible, coinsurance and out-of-pocket maximums. Your CVS Caremark coverage is accepted at many major pharmacies, not just your local CVS. To find a pharmacy near you, go to www2.caremark.com/nlc > Locate a Pharmacy.

If you enroll in the HRA Core plan, your medical plan carrier automatically applies your health reimbursement account dollars to your eligible prescription drug costs. When your account balance reaches zero, you begin paying the full cost of your prescription drugs out of pocket until you meet your deductible. If you participate in a standard healthcare FSA, you can choose to pay your out-of-pocket costs with FSA dollars.

If you enroll in the HSA Plus or HSA plan, you’re responsible for the full cost of your prescription drug costs until you meet your deductible. You can choose to pay your prescriptions out of pocket or with dollars from your health savings account. A money-saving feature of the HSA Plus and HSA plans is certain generic preventive medications are covered at 100% without you having to meet your deductible. You can find the list of these generic preventive medications at www2.caremark.com/mckesson > Check Availability & Cost > HDHP Preventive Drug List – Generics.

How Coinsurance WorksWhen you reach your deductible under any of the primary plans, you begin paying coinsurance until you reach the out-of-pocket maximum. Once you reach your out-of-pocket maximum, you pay nothing for your eligible prescription drugs for the remainder of the year.

Coinsurance (in-network only)

HRA Core plan Generic and preferred brand name drugs You pay 20% — McKesson pays 80%

Non-preferred brand name drugs You pay 40% — McKesson pays 60%

HSA Plus and HSA plansGeneric, preferred and non-preferred brand name drugs You pay 20% — McKesson pays 80%

Medical

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Additional Medical Coverage

HMOs and EPOs — Available in Limited LocationsUnder a Health Maintenance Organization (HMO) or Exclusive Provider Organization (EPO) plan, you’re typically charged a copay (flat dollar amount) for office visits and a coinsurance amount for certain services. Generally an HMO/EPO plan doesn’t cover out-of-network services, except in emergencies. Visit UPoint at http://resources.hewitt.com/mckesson to find out if an HMO/EPO plan is available in your state. If available in your area, compare HMO/EPO plans to the HRA Core, HSA Plus and HSA plans to see which plan is right for you.

Available plans include:

• Aetna HMO — various locations

• Cigna HMO — various locations

• HMSA/Blue Cross HMO — HI

• Kaiser HMO — CA

• Kaiser HMO — CO

• Kaiser HMO — GA

• Kaiser HMO — HI

• Kaiser HMO — Mid-Atlantic

• Kaiser HMO — Northwest OR/WA

• Medical Associates HC Premier CDHP

• Tufts EPO — MA

• UPMC Health Plan HMO — PA

Employed Spouse/Domestic Partner Charge

Just as we offer you resources and programs through your Total Rewards, your spouse/domestic partner’s employer may do the same. To help us better manage our healthcare costs, we apply an employed spouse/domestic partner charge.

As you enroll on UPoint, expect to confirm whether your spouse/domestic partner is eligible for medical coverage at his or her workplace. If you choose to cover your spouse/domestic partner who is eligible for medical coverage through his or her employer, you’ll incur a $100 monthly charge.

If your spouse/domestic partner is not employed or eligible for medical coverage through his or her employer, be sure to answer “no” to avoid the charge.

If your spouse/domestic partner is eligible for coverage through his or her employer and you choose to cover him or her under your McKesson medical plan, answer “yes.” If your spouse/domestic partner loses his or her job or becomes ineligible for coverage through his or her employer, this is considered a qualifying event and you can add him or her to your McKesson coverage without incurring the $100 monthly charge.

To avoid the charge, choose not to cover your employed spouse/domestic partner and encourage him or her to enroll in medical coverage through his or her employer.

Medical

The $100 charge doesn’t apply if you and your spouse/domestic partner both work at McKesson. Additionally, the monthly charge doesn’t apply to dental and vision coverage.

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Vision

Vision Service Plan (VSP) is our vision carrier. You have your choice of two plan options — VSP and VSP Plus — that offer 100% in-network coverage for routine eye exams and prescription glasses after a copay. VSP Plus provides the highest level of coverage, which means you can expect to pay a higher per-paycheck premium in exchange for smaller copays and a higher annual allowance for frames and contact lenses.

You receive the best value under either plan if you visit a VSP doctor. When you see a non-VSP doctor, you’re required to pay in full up front and submit a claim to VSP for partial reimbursement. Visit www.vsp.com or call 800.877.7195 to find a VSP provider in your area.

Vision Options In-Network Benefits*

VSP VSP Plus

Plan pays up toEye exam • 100% after $15 copay

• Once every calendar year

• 100% after $10 copay

• Once every calendar year

Prescription glasses • 100% up to plan allowance after $25 copay for lenses and/or frame

• 100% up to plan allowance after $10 copay for lenses and/or frame

• Frame • Up to $130 allowance

• Once every other calendar year

• Up to $210 allowance

• Once every calendar year

• Lenses (includes single vision, bifocal, trifocal and lenticular lenses)**

• Once every calendar year

• Progressive and other lens enhancements available at a discount

• Once every calendar year

• Progressive lenses covered after $40 copay

• Other lens enhancements available at a discount

Elective contact lenses (instead of prescription glasses)

• Up to $150 allowance

• Once every calendar year

• Up to $200 allowance

• Once every calendar year

* These coverages are also available for out-of-network provider services. However, dollar maximums apply to exams, lenses, frames and contact lenses as shown in the Vision Summary Plan Description (SPD). Find the Vision SPD on the Total Rewards Library under the SPDs tab.

** The plan doesn’t cover the cost associated with other lens options such as anti-reflective coating, color coating, mirror coating, scratch coating, blended lenses, cosmetic lenses, laminated lenses, oversize lenses, polycarbonate lenses (except for children), photochromic lenses, tinted lenses (except Pink #1 and Pink #2), and ultraviolet protected lenses. For more information, refer to the Vision SPD. Find the Vision SPD on the Total Rewards Library under the SPDs tab.

Dental

Cigna is our dental carrier and you can choose between two Dental Preferred Provider Organization (PPO) coverage options — PPO and PPO Plus — and the Dental Health Maintenance Organization (DHMO). The PPO, PPO Plus and DHMO plans cover in-network preventive care at 100%. PPO Plus members pay a smaller percentage of coinsurance for basic and major dental procedures and have a higher calendar year benefit maximum than PPO members. Under the PPO plans, you save money by using in-network providers who have negotiated discounted rates with Cigna dental. Visit Cigna at www.cigna4mckesson.com to find a network dentist in your location.

PPO PPO Plus DHMO

Out-of-network coverage Yes Yes No

Dental cleanings 100% of eligible charges 100% of eligible charges 100% of eligible charges

Deductible $50 individual$150 family

$50 individual$150 family

None

Coinsurance/copay 80% or 50% coinsurance after meeting deductible

90%, 60% or 50% coinsurance after meeting deductible

Fixed copay

Orthodontia coverage For children under age 19 For children under age 19 Adults and children

Calendar year benefit maximum

$1,500 per person $2,000 per person None

Dental and Vision

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Long Term Disability (LTD)

Your Total Rewards include short term disability (STD) at no cost to you. You can choose to enroll in LTD during your enrollment period. LTD coverage protects your income if you’re out of work for more than 180 days due to a prolonged disability. LTD provides 60% of your covered earnings (up to a maximum monthly benefit of $25,000) minus earnings from other income.

You pay only 30% of the cost for LTD coverage. McKesson pays the other 70%. This makes your cost for LTD benefits very affordable in relation to the potential value. For example, if you earn $50,000 a year, you pay $3.99 per month for LTD coverage and receive $2,500 per month in benefits, if you were to become disabled.

LTD doesn’t pay for a disability that results from a pre-existing condition and begins during the first 12 months of coverage.

Supplemental Life and Accidental Death & Dismemberment

You automatically receive basic life and Accidental Death & Dismemberment (AD&D) benefits as part of your Total Rewards. During your enrollment period, you can choose to purchase supplemental coverage for yourself, or your spouse/domestic partner and children.

• Supplemental employee life and AD&D insurance: $10,000 to eight times your pay (or $1.5 million, whichever is less)

• Spouse/domestic partner life and AD&D insurance: $20,000 to $400,000 with Evidence of Insurability (EOI), or up to $60,000 without EOI

• Child life and AD&D insurance: $5,000 to $25,000 per child (in $5,000 increments) without EOI

Supplemental Insurance

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Employee Stock Purchase Plan

The Employee Stock Purchase Plan (ESPP) allows you to invest in your future while also investing in McKesson. You may contribute up to 15% of your eligible compensation; the maximum contribution to the ESPP is $21,250 — this is after applying the 15% discount to the IRS limit of $25,000 in value of shares. You may participate in the program if you:

• Have been employed by McKesson or a designated subsidiary for 60 days prior to the beginning of an offering period.

• Work more than 20 hours per week and you’re expected to work more than five months a year.

You’ll receive an ESPP welcome kit once you meet the eligibility requirements. The ESPP has 3-month offering periods with purchases made every 3 months. New offering periods begin on February 1, May 1, August 1 and November 1. The purchase dates are April 30, July 31, October 31 and January 31. Enroll and find more information on the ESPP though Fidelity at www.netbenefits.com.

401(k)

Your financial health is an important part of your overall wellness. That is why we offer our 401(k) plan, the Profit-Sharing Investment Plan (PSIP), to help you save for retirement. Through automatic payroll deductions, you can contribute between 1%-75% of your paycheck on a pre-tax and/or Roth after-tax basis (up to $18,000 in 2016), and an additional 1%-75% in catch-up contributions if you’re age 50 or older (up to $6,000 in 2016).

The PSIP investment lineup allows you to invest your own employee contributions and Company-matching contributions among the nine Core Options or Vanguard Target Date Retirement Funds. In addition, you may use Fidelity BrokerageLink for access to a wide array of other investment options. These investment options give you the flexibility to build your own strategy to meet your needs and goals. You can even roll over money from any prior 401(k).

With Company-matching contributions to supplement your own savings, the PSIP can help you achieve your individual financial goals quickly. McKesson provides a 1:1 match for the first 3% of your paycheck and a 1:2 match for the next 2%, with McKesson’s contribution capped at 4% of your pay. For example, if you put in 3%, McKesson puts in 3%, if you put in 5%, McKesson puts in 4%. Both your contributions and McKesson’s contributions are 100% vested immediately. If you contribute 5% with an annual salary of $40,000, your semi-monthly paycheck will be reduced by $58. However, your per-paycheck employee contributions will be $77, with an additional $62 from McKesson. This means you’ll save a total of $139 per paycheck, equaling $278 per month.

Retirement Programs

You’ll receive notification when you’re eligible to participate in the PSIP and ESPP. Find additional information on www.netbenefits.com or call the PSIP Service Center at 888.MCK.PSIP (888.625.7747).

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VitalityVitality is a voluntary wellness program that rewards you for taking steps to maintain or improve your health. Activities such as walking, yoga classes or yearly flu shots all generate Vitality Points™. As you increase your Vitality Points, you increase your Vitality Status® and earn rewards, such as savings on your McKesson medical premiums and gym membership discounts or subsidies. You’re eligible to participate in Vitality on your date of hire. To learn more, view the Introduction to Vitality flyer included in your New Hire Kit.

Life and Accident• Basic employee life insurance — this policy pays a $50,000

benefit to your beneficiary if you die from any cause.

• Basic employee accidental death & dismemberment insurance (AD&D) — this policy pays a benefit of $50,000 in the event you die as the result of an accident. You may receive partial benefits if you lose a limb, eye, hearing or speech due to an accident.

Short Term DisabilityShort term disability (STD) benefits begin on the eighth day of disability and continue for up to 26 weeks, as long as you remain disabled. Your benefit amount is equal to a percentage of your pre-disability earnings minus earnings from other income.

Talk to your local Wellness Champion to find out about activities at work that you can participate in to get healthy, have fun and earn Vitality Points. If you aren’t sure who your Wellness Champion is, log on to McKNet and select Pay & Benefits > Health & Wellness > Wellness Champion Directory.

McKesson-Paid Total Rewards

Beyond quality healthcare coverage and tools and resources to take charge of your health, your Total Rewards include a number of McKesson-paid benefits. Here are just a few.

Additional Total Rewards

Complete the Vitality Health Review™ (VHR) as soon as possible to begin saving $35 per month on your McKesson medical premiums. Once you register and log on to www.powerofvitality.com, select Points > Points Planner > Vitality Reviews > Vitality Health Review.

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CastlightCastlight is an online shopping tool that helps you make informed healthcare choices. Once you’re registered on Castlight, you can use the tool to compare local healthcare providers’ costs and quality reviews — much like you would for a plumber or mechanic. You can also track past healthcare expenses, view details of your medical coverage, find an in-network doctor or specialist and research a variety of medical conditions. Castlight is available at no cost to you and your spouse/domestic partner if you’re a member of the HRA Core, HSA Plus or HSA plan.

Learn more at www.mckesson.com/totalrewardslibrary > Flyers > Introducing Castlight.

Commuter ProgramThe WageWorks Commuter Benefits Program rewards you for riding smart by allowing you to use before-tax dollars to pay some of your work-related commute expenses. The program can save you as much as 40% on qualifying purchases depending on your personal tax situation. Work-related commuter benefits for travel between home and work include:

• Public transportation (bus, subway, train)

• Vanpool

• Parking expenses (parking lots and garages)

For more information and to find out how you can enroll in the Commuter Benefits Program, see the WageWorks Commuter flyer in your New Hire Kit or call WageWorks at 877.924.3967.

Additional Total Rewards

Weight Loss Reimbursement Program

Achieving and maintaining a healthy weight is one of the best ways to improve your overall health. Through Vitality, you have the opportunity to join Weight Watchers at no cost to you as long as you meet program requirements. Or, if you prefer a different weight-loss program, you can receive a once-per-lifetime reimbursement.

Quit For LifeQuit For Life is a tobacco cessation program brought to you by the American Cancer Society and Alere Wellbeing, Inc. This program is designed to help you overcome tobacco addiction using a combination of phone-based coaching, web-based learning and social support. The program may also help you determine if nicotine gum, patches or a prescription drug can help you become tobacco free.

Additional Total Rewards

Learn more about smoking cessation, weight loss and additional healthy living programs at www.powerofvitality.com.

Tip

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HR Support Center855.GO.MCKHR (855.466.2547)Press 1 for the McKesson Benefits Center for Health, Vitality and Pension questions. Benefit experts are available 9 a.m. - 5 p.m. Central time, M-F. Oprime 1 para recibir asistencia en español a través del McKesson Benefits Center.

Call the HR Support Center for:• Answers to general questions about all

of your coverage options

• Eligibility and enrollment guidance

• Help resetting your UPoint password

Consult with a Personal Health AdvocateIf a benefit expert is unable to answer your questions, a Personal Health Advocate will contact you within 24-48 hours.

Enrollment Tools

UPointhttp://resources.hewitt.com/mckessonLog on to make your enrollment choices, access enrollment tools, such as cost calculators, medical expense estimators and live Web Chat with an enrollment specialist.

• DecisionDirect™ Use DecisionDirect to help you find the right medical plan for you and your family. DecisionDirect is an online questionnaire that uses your responses to a few simple questions to match you with a medical plan.

• Health Plan Pricing Tool Compare and estimate plan pricing for all of our medical, dental and vision plans. You can also see how much you can expect to save by participating in Vitality and increasing your Vitality Status.

Total Rewards Librarywww.mckesson.com/totalrewardslibrary Find more details about your coverage options, health reimbursement accounts, health savings accounts, FSAs and how you can save on your McKesson medical premiums. The Total Rewards Library is available 24/7 from any computer or mobile device with an Internet connection.

Pay & Benefits Apphttps://employeeapps.mckesson.com/payandbenefits View your healthcare coverage, Vitality Points, 401(k) balance and more Total Rewards information from your mobile device.

Enrollment Tools

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Your Enrollment Checklist

Make sure you’re able to log on to UPoint, the benefits enrollment website, at http://resources.hewitt.com/mckesson.

Think about your healthcare needs — any major procedures scheduled?

Choose a medical plan. Start by deciding if a health reimbursement account or health savings account is right for you.

Compare medical plan carriers by visiting their websites — see p. 19.

Use online tools and resources to understand your options:

• UPoint - DecisionDirect™ — receive personalized plan recommendations.

- Health Plan Comparison Charts — see side-by-side comparisons of deductibles, out-of-pocket maximums and other plan features.

- Medical Expense Estimator — estimate how much you can expect to pay for common healthcare expenses under each medical plan.

• Carrier Websites Visit your current medical plan carrier’s website to review your healthcare expense history, which can help you estimate future expenses and determine which plan makes sense for you.

• Total Rewards Library Find more details about your coverage options. In particular, read How the Medical Plan Accounts Work and watch videos that highlight plan details and examples.

Enroll in medical, dental, vision, flexible spending accounts (FSAs), long term disability (LTD), supplemental life and accidental death & dismemberment (AD&D) coverage.

Provide Social Security Numbers (SSNs) for your covered dependents.

Indicate if your spouse/domestic partner is eligible for medical coverage at his or her workplace.

Print your enrollment confirmation.

Prepare for Enrollment

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Enroll on UPoint

1. Log On to UPointGo to http://resources.hewitt.com/mckesson and enter your username and password.

• If you’re a first-time user, click Log On and select Register as a New User.

2. Make Your Choices• On the homepage, under Action Needed!, click Enroll.

Or select the Health and Insurance tab and under Enroll! click Enroll Now!

• View your enrollment options.

• Choose your coverage.

3. Select “Complete Enrollment” or “Quit”If you select:

Complete Enrollment — you save your choices and complete the enrollment process.

• Print out the “Submitted Successfully” message and reference number as confirmation.

• If you provided an email address, you receive a confirmation email with instructions for viewing your enrollment confirmation on UPoint.

• If Evidence of Insurability (EOI) is required, a “Submitted Successfully - Required Follow-Ups” page appears, and you receive a confirmation number. (You can print this page as confirmation.)

Quit — your choices are not saved and they are cancelled.

• You see a “Cancelled Successfully” message.

• You need to make new choices the next time you log on to UPoint.

Enroll on Your Mobile DeviceLog on to the UPoint Mobile site by visiting http://resources.hewitt.com/mckesson from your mobile device and completing steps 1-3.

Live Web Chat available on UPointChat with a representative on UPoint. Web Chat representatives are available to answer your questions from 9 a.m. - 3 a.m. Central time. Click the Live Help button at the top-right corner of the UPoint homepage to begin a Web Chat session.

Create favorites on your UPoint page for quicker access to the information you use the most.

Tip

Plan Ahead for a Smooth Transition• Find out if your current doctor and pharmacy are in

your new medical plan’s network.

• If you’ll be changing doctors, request copies of your medical records to provide to your new doctor.

• Call your new medical plan carrier or prescription drug carrier if you have coverage questions.

• Connect with a Personal Health Advocate by calling the HR Support Center if you need personalized assistance with a coverage question.

What Comes Next• Medical and dental ID cards (and prescription drug ID

cards if issued separately under a plan) will arrive in the mail within three to four weeks of your enrollment. VSP doesn’t issue ID cards. When visiting a VSP provider, simply provide your Social Security Number.

• FSA debit cards will be sent to healthcare FSA and HSA-compatible FSA plan participants.

• If you enroll in the HSA Plus plan and/or select a health savings account contribution amount on UPoint, a Fidelity account is automatically set up for you. You need to activate your account at www.netbenefits.com before you can access your dollars.

Make Choices by PhoneCall an HR Support Center representative to select your benefits by phone or to ask for help with other matters.

• Dial 855.GO.MCKHR (855.466.2547) and press 1.

• When prompted, enter the requested information.

• After hearing the main menu message, say: “Healthcare.”

• When prompted, enter your password (same as your UPoint password).

Enrollment Steps

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Contacts

Contact Information

Aetnahttp://aetnaresource.com/8778/mckesson 877.286.3900 Available in all states except Hawaii.

Anthemhttp://enrollment.anthem.com/McKesson 866.820.0763 Available in California, Florida, Michigan and Pennsylvania.

Cigna www.cigna4mckesson.com 800.244.6224 Available in all states except Hawaii.

CVS Caremarkwww.caremark.com 800.378.0822

Cigna Dentalwww.cigna4mckesson.com800.CIGNA24 (800.244.6224)

Vision Service Plan (VSP)www.vsp.com800.877.7195 imember@vsp.com

Fidelity Investments (for 2016 health savings accounts, PSIP and ESPP)www.netbenefits.com 888.MCK.PSIP (888.625.7747) 7:30 a.m. - 7 p.m. Central time, M-F

WageWorks (for FSAs and 2015 health savings accounts) www.wageworks.com 877.924.3967

Condition Support Managers

Aetna — Aetna Health Connections 866.269.4500

Anthem — Condition Care 866.820.0763

Cigna — Personal Health Team 800.244.6224

November 2015

UPointhttp://resources.hewitt.com/mckesson Your online destination for reviewing and managing your Total Rewards. Web Chat is available 9 a.m. - 3 a.m. Central time. Click the Live Help button to begin a Web Chat session.

HR Support Center855.GO.MCKHR (855.466.2547) Press 1 for the McKesson Benefits Center for Health, Vitality and Pension questions. Benefit experts are available 9 a.m. - 5 p.m. Central time, M-F. Oprime 1 para recibir asistencia en español a través del McKesson Benefits Center.

Total Rewards Librarywww.mckesson.com/totalrewardslibraryFind more details about your coverage options, health reimbursement accounts, health savings accounts, FSAs and how you can save on your McKesson medical premiums. You can access the Total Rewards Library 24/7 from any computer or mobile device with an Internet connection.