Midyear review: pharmacy costs drive plan changes as PBM switch yields early rebates

Presenter: In a midyear review ahead of the plan’s May 1 renewal, staff told the group that inpatient claims were down by more than $1,000,000 compared with the same point last year, though some costs shifted to outpatient services. ‘‘Inpatient claims are down over $1,000,000,’’ the Presenter said, and added that overall year-to-date claims are running about $890,000 over budget.

Presenter: Pharmacy has become the plan’s largest spending category. Staff reported pharmacy totals rising from about $11.2 million in 2022 to roughly $13.5 million in 2024 and said the increase has slowed but remains significant. The Presenter said the plan moved its pharmacy benefit to an Express Scripts arrangement through Crumdale Partners effective May 1 to secure deeper discounts and more-transparent reporting.

Staff member: ‘‘The rebate payment for the first two months was $1,581,000,’’ a staff member said, ‘‘which equates to about $110.73 per member in savings,’’ and noted those rebate dollars will be counted when setting next year’s rates. Staff also said the plan’s generic fill rate is about 87 percent and that specialty medications account for roughly 45.6 percent of plan specialty spend versus a peer benchmark of 51.5 percent.

Presenter: Staff described an operational problem after the PBM change that temporarily moved 34 members away from a local hospital specialty pharmacy. ‘‘We later contracted directly with Lake Charles Memorial Hospital’s pharmacy,’’ the Presenter said, restoring local specialty fills for affected members and preserving access while keeping the specialty-management network in place.

Committee member: During Q&A, a committee member raised concerns about patients who use manufacturer coupons or who are undergoing chemotherapy and asked whether plan design tweaks (copay and deductible changes) should be considered. The Presenter said actuarial analysis had modeled several options and that moving one plan option from a $1,250 deductible to a $1,650 HSA-eligible deductible could lower required funding by roughly $1,300,000. Another scenario presented — a $2,000 option with a $4,000 out-of-pocket cap — showed a different funding profile (staff presented a $3,400,000 figure for that scenario).

Staff member: On large claimants and reinsurance, staff said the plan saw five large claimants this year (four last year) and that reinsurance covers claims above $750,000; reinsurance recoveries were slightly below last year but the stop-loss program remains in force.

Nut graf: The midyear presentation framed pharmacy-management changes and targeted plan-design adjustments as the primary levers to curb spending before the May renewal. Staff urged additional member education (videos, in‑service sessions and vendor meetings) and recommended monitoring the high-deductible migration closely to protect actuarial integrity.

What happens next: Staff told the group they will receive another detailed report in January with updated rebate and claims data; staff also said they will incorporate the rebate figures into next-year rate calculations and will present specific plan-change recommendations before the renewal vote.