Committee approves $1.87 million payment to Caremark to settle December 2024 pharmacy claims

The Cuyahoga County Human Resources, Appointments and Equity Committee on Feb. 18 approved Resolution 20250079 to authorize a purchase order to Caremark PCS Health LLC not to exceed $1,868,943.48 to cover outstanding December 2024 pharmacy benefit-management invoices.

Sarah Nemasol, director of human resources, introduced the item and said the payment covered invoices tied to the county’s self-insured prescription benefits plan. Stephen Witt, business services manager for the department, told the committee the contract has expired and that the payment is being handled through a purchase order rather than a contract amendment.

Witt described how the county’s self-insured plan works and why an outstanding balance emerged. “Because we are a self-insured medical plan and prescription drug plan, we pay claims on a weekly basis,” Witt said, explaining that CVS, acting as claims administrator, fronts payments to providers and the county reimburses them via ACH. He said costs exceeded projections and the prior contract included roughly a 5% buffer; the county’s next contract will include a 10% buffer to help prevent similar shortfalls.

Committee members pressed staff on why payments are made weekly and whether a biweekly cadence would be more efficient. Witt said weekly reimbursement reflects providers’ expectations because CVS and other administrators front large weekly sums to providers and then seek prompt reimbursement from the county.

On how projections were created, Witt said the county’s vendor Oswald used actual claims data and industry inflation assumptions. He identified the rapid uptake of GLP‑1 medications—prescription drugs for weight loss and diabetes treatment such as semaglutide (marketed as Wegovy and related products)—as an unanticipated driver of higher-than-projected costs. "Those things are reactionary," Witt said of new medication trends, adding the county implements cost controls after the usage increases are observed.

Witt also told the committee the contract’s rebate structure changed and the county now receives rebates that return to the county quarterly; he estimated rebates of about $2,000,000 every quarter that were not built into the original not-to-exceed authority.

After discussion, the committee voted to approve the purchase order under second-reading suspension. All four members present voted to approve the resolution; one member, Councilmember Conwell, was recorded as absent.

Committee members also asked about employee wellness incentive timing; staff said the incentive payment would appear in Feb. 28 paychecks and that an e-mail notification had been sent to employees.

Resolution 20250079 authorizes a purchase order to Caremark PCS Health LLC in an amount not to exceed $1,868,943.48 as final payment for December 2024 pharmacy benefit-management services rendered under contract no. 1978 covering Jan. 1, 2022, through Dec. 31, 2024. The committee approved the measure and the item was recorded as passed.