WCPS officials cite rising specialty drug costs and GLP‑1 prescriptions as drivers of self‑insurance deficit; board told plan design changes and 10% premium are

Washington County Public Schools’ finance and benefits team briefed the board on its self‑insurance fund, attributing recent deficits largely to a rise in specialty pharmaceutical costs and a recent surge in GLP‑1 weight‑loss medication claims.

Chief Operating Officer Jeff Pru told the board the district uses a self‑insured model and Cigna as its third‑party administrator. Pru said total medical claims climbed from roughly $51 million to nearly $79 million over a six‑year period and that per‑member‑per‑year (PMPY) costs have risen from about $5,009 to a projected $8,005. “The planned fund balance is projected to be at a deficit of about 2 and a half million at the end of this fiscal year,” Pru said.

Consultants and staff identified two large drivers: biologic specialty drugs and a rapid uptick in GLP‑1 weight‑loss medication usage. Sherry Hirschman, an Arthur J. Gallagher consultant, said late‑cycle increases in GLP‑1 prescribing ran “about a half $1,000,000 a month” for roughly 400–500 members before the plan’s health‑care committee agreed to discontinue GLP‑1 coverage for non‑diabetes indications effective Oct. 1.

Staff outlined options to shore up the fund. Those included relying on the district health clinic run by Marathon Health (a $2.2 million‑a‑year operation), using wellness funds and point solutions (for musculoskeletal care, mental health), tighter network contracting and market shopping for better administrative fees and stop‑loss pricing. Consultants also described “small needle movers” (network and vendor management) and “big needle movers” such as plan‑design shifts that transfer more cost to users — for example raising deductibles, introducing HRAs, or altering family‑tier cost shares.

Pru said the district is proposing a 10% premium increase for the coming year and noted the current plan design is richer than k‑12 national benchmarks (deductibles of $100/$200, out‑of‑pocket maximums of $1,000/$2,000, and zero coinsurance). He said earlier reductions in prescription coverage (GLP‑1) and recent copay and drug‑copay adjustments are already moderating pharmacy trends.

Board members pressed consultants on alternatives such as spousal surcharges, pooled purchasing with county or other public entities, and whether the health clinic’s ROI is material. Presenters said pooling is possible but risk profiles differ when including law enforcement, public works or correctional staff. They also said clinic effect on claims typically becomes clearer after two to three years and that the clinic is intended to improve chronic‑disease metrics and reduce overall claims over time.

There was no formal vote. Staff said the health‑care committee and bargaining units will continue plan‑design discussions ahead of next year’s budget and premium decisions.