Osceola school health plan sees 16% jump as pharmacy and large claims rise

The School District of Osceola County (SDOC) heard a detailed update in a July 2025 Plan Board workshop on the district’s self‑funded health plan, where the district’s actuary and benefits advisers said the plan is facing a 16% year‑over‑year increase in per‑member medical and pharmacy claims.

The increase is being driven about half by an unexpected rise in “large claim” cases — members with claims above $100,000 — and the other half by pharmacy spending, which staff said is up about 30% year over year. “In this most recently completed fiscal year, we've had 102 claimants at a $100,000 and above,” actuary Jay Miniati told the board, adding that cancers comprised roughly half of the ultra‑high‑cost cases this year.

Why it matters

The district’s plan runs about $80 million annually, staff said, with roughly $65 million paid in claims; a $6 million per‑year increase in monthly run‑rate (about $500,000 a month) is a material budgeting pressure. Under Florida law the district must hold a reserve (actuary cited Florida Statute 112.08) and the actuary presented projections showing how the plan’s reserve and projected expenses would look if plan design and contributions remain unchanged.

Details of the board briefing

Presenters described several linked drivers and mitigation efforts. Miniati, the actuary engaged for SDOC, broke the $65 million in claims into a large‑claim bucket (about $23 million) and everyday claims (about $42 million). On a per‑member‑per‑month basis the overall claim run was reported at about $586; pharmacy accounted for about $125 of that PMPM and had risen roughly 30% year over year.

Staff described the plan design features that aim to control costs while preserving access: a district health center that functions as a medical home, an on‑site retail pharmacy, mobile screening units (mammography, dermatology, vision), and targeted programs such as specialty case management for chronic kidney disease and a pilot oncology (cancer) care/navigation program. Benefits staff said use of the health center and onsite pharmacy tends to lower costs and improve continuity of care for members who use those services.

Pharmacy and rebates

District advisers and vendor partners gave a detailed account of pharmacy management strategies. Staff described a three‑part approach: (1) active sourcing (including past international sourcing for certain specialty drugs), (2) contract and formulary management to shift members to lower‑cost or biosimilar alternatives when clinically appropriate, and (3) real‑time monitoring with the pharmacy benefit manager (PBM). Lauren (benefits operations) said the PBM runs daily pricing feeds and the team reviews high‑cost drugs monthly.

Speakers explained that manufacturer rebates and formulary placement materially affect net cost. As presenters put it, rebates are set by manufacturers and fluctuate; the district’s advisers continually re‑evaluate whether international sourcing or domestic purchasing plus rebates gives the lower net cost. Staff stressed rebates are an imperfect short‑term tool because the net value can change and is typically returned after the plan pays initially.

Large claims, case management and cancer care

The actuary and benefits team said large claims were a major contributor to this year’s uptick. Miniati said the threshold used for a “large claimant” is $100,000 and noted the district averaged 89 such claimants several years ago but saw 102 in the most recent fiscal year. Presenters reported that cancers represent a large share of the very high‑cost cases this year (about half, versus a historical ~1/3), and that breast cancer accounted for a notable share of cancer cases — a pattern consistent with the district’s largely female enrollee population.

Staff described active outreach once a case enters the high‑cost list: specialty case managers contact members, coordinate care, and try to steer patients to quality providers inside the district’s contracted network when clinically appropriate. The district said it is piloting an oncology navigation program to provide specialist case management, help members access manufacturer assistance or clinical trials, and reduce avoidable admissions or long stays.

Care‑site steering and utilization

Presenters emphasized the plan’s focus on steering appropriate care to lower‑cost sites (telehealth, urgent care, health center) rather than emergency departments when clinically suitable. Actuarial and benefits staff showed benchmark comparisons (national K‑12 benchmarks and regional ad hoc comparisons) and noted SDOC’s outpatient utilization and ER use patterns versus those benchmarks. Staff acknowledged long‑standing behavioral and access challenges — for example, members who default to ERs for urgent care needs — and described ongoing education efforts, outreach at onboarding, and on‑site/mobile services to reduce barriers.

Health center and mobile services

Officials highlighted the health center plan, a medical‑home model with lower payroll contributions, reduced deductibles and copays for users, and no referral required for some services (OB‑GYN, pediatric care and mental health in some cases). Staff reported high member satisfaction for the health center: net promoter score (NPS) was reported in the high 80s based on roughly 1,700 monthly survey responses.

The district said use of onsite imaging contracts and mobile clinics (mammogram bus, dermatology bus, mobile vision) has increased preventive screening rates and caught serious conditions — presenters said the dermatology and mammography mobile programs have identified melanomas and other conditions that benefited from early intervention.

Governance, reserves and next steps

Actuary Miniati reviewed statutory reserve requirements under Florida Statute 112.08 and presented projections showing the plan’s funding status under a status‑quo scenario. Staff said they review stop‑loss (reinsurance) attachment points regularly and have considered lowering the individual stop‑loss aggregate deductible (reported in presentation as $135,000 aggregating deductible) but have retained the current levels after cost/benefit analysis.

The board received several operational updates and direction items rather than taking formal votes. Notable next steps or direction reported in the meeting record: the CFO gave approval for staff to research acquisition of a district mobile health unit (a satellite health center on wheels) and benefits staff said they will continue daily/monthly PBM monitoring, refine benchmarking to local peers, and continue the oncology pilot and high‑cost claimant management efforts. Staff also said they will provide more detailed breakdowns requested by board members (for example, pharmacy drivers by drug class and the tenure/newness of high‑cost claimants).

No formal board action or vote was recorded in the transcript of this workshop.

Ending

Presenters framed the increases as a mix of external factors (drug manufacturers, general cost growth and an unusually high number of large claims this year) and internal choices (high uptake of preventive services that can create short‑term pricing pressure). The district’s advisers told the board the team is actively managing contracts, case management and plan design and will return with more detailed follow‑up analysis and recommended options for the board to consider before any change to plan design or employee contributions.