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Durham County keeps Cigna for 2025'26 health plan after RFP; pharmacy guarantees reduce projected cost
Summary
After a competitive RFP, county staff recommended staying with Cigna for the self-funded health plan and securing improved pharmacy cost guarantees; staff warned that medical claim frequency, high-cost specialty drugs and stop-loss renewals are driving projected benefit cost increases of roughly $6.3 million for 2025'26.
Durham County benefits staff told the Board of Commissioners on May 13 that a competitive request for proposals (RFP) covering medical administration, pharmacy benefit management and stop-loss insurance produced better pricing and stronger performance guarantees from incumbent Cigna.
Chief human-resources and benefits staff said the county keeps a self-funded medical plan where the county pays claims below a stop-loss threshold and buys stop-loss insurance for catastrophic claims (current attachment point $225,000). The county received multiple proposals for medical administration, pharmacy benefits and stop-loss coverage and evaluated total cost, provider network access and member disruption.
Staff reported the renewed Cigna proposal included materially stronger pharmacy cost guarantees and no so-called "lasers" (individual claim exclusions) on renewal; they estimated about $2 million in pharmacy-related cost reductions from the new contract. Cigna also proposed increased wellness funding and service guarantees that staff said reduced member disruption by allowing continuity of provider networks.
Why it matters: benefits are among the largest nonpayroll costs in the recommended budget. Staff told commissioners that employer-paid benefits are increasing by roughly $6.3 million for 2025'26 and that the largest driver is overall claim experience, an aging employee population and high-cost specialty medications (for example GLP-1 weight-loss/diabetes drugs). The county plans utilization-management and prior-authorization changes for GLP-1 medications effective July 1 to limit inappropriate use for weight loss and to manage program cost.
Plan design and employee contributions: the county currently offers a two-tiered medical plan (a lower-cost base plan and a buy-up option with lower deductibles). Staff said the base employee-only contribution remains competitive in peer benchmarking and that the buy-up option is paid partially by employees who choose it. The county also provides an HRA credit to participating employees who complete a biometric screening and wellness activities.
Next steps and board requests: staff said they will provide additional detail on dental and vision trend questions raised by commissioners and agreed to follow up with specific cost-savings numbers by plan tier, the count of employees who purchased the buy-up option, and participation metrics for wellness programs including the county's on-site clinic and Choose-to-Move program.
Ending: Commissioners thanked benefits staff for the work; staff stressed the county's aim to preserve a competitive benefits package while containing cost growth through RFP competition, targeted utilization management and expanded wellness and clinic use.
