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County consultants recommend keeping Highmark for medical, switching pharmacy benefits to Capital Rx to curb drug-cost growth
Summary
BeneTech consultants told the Board that self-funding has unlocked claims data and rebates and recommended Highmark Blue Shield for medical coverage and Capital Rx for pharmacy services; consultants said the county—ould save about $400,000 by capturing higher rebates and adopting a transparent NADAC model.
BeneTech consultants told the Board of Supervisors that the county should retain Highmark Blue Shield for medical coverage while switching its pharmacy benefit manager to Capital Rx, a move the consultants said could slow the county rug-cost trend.
At a presentation that opened the meeting, Darren Mosher of BeneTech reviewed an RFP that drew seven medical carriers, eight pharmacy benefit managers and nine dental carriers. Mosher said the county—enefitted from moving to a self-funded model in June 2023 because it produced detailed claims data and drug rebates that had previously been retained by carriers: "since you guys have been self-funded, you've gotten over $2 million back in drug rebates," he said.
Why the switch? Mosher told supervisors the county—aces outsized drug-cost pressures. "The county's drug costs have gone up 81%" between 2022 and 2025, he said, driven by specialty drugs, new therapies and larger hospital and physician-group consolidation that raises bargaining power. Large claims (defined in the presentation as more than $50,000 per year) also rose and concentrated costs among a small number of members.
The consultants recommended Highmark Blue Shield on the medical side for "best value," citing competitive administrative fees, network continuity and willingness to work with the county. On the prescription side, they recommended Capital Rx and explained its transparent NADAC-based pricing: rather than an AWP-based spread model, Capital Rx "are actually charging the cost of the drug, the acquisition" and collecting an administrative/dispensing fee, Mosher said. That structure, the consultants said, reduces hidden spreads and better aligns incentives.
An actuary—xercise included in the RFP pricing assumed higher rebate capture under Capital Rx (roughly 27% versus the county's current ~19%), which was priced into the proposals and valued at about $400,000 in the submission. BeneTech emphasized that Capital Rx lso offers clinical services and an exceptions/appeal process that could be used to manage formulary decisions under a self-funded structure.
On dental coverage the consultants recommended staying with Delta; their modeling found the self-funded dental option would be effectively cost-neutral and not worth the additional risk.
Board members pressed on implementation details including member disruption, mail-order transitions and how clinical exceptions would be handled. Mosher said Capital Rx can reach out to current mail-order members and that exception reviews could be handled with a pharmacy consultant and county physician input. He cautioned the change would not be a panacea but framed it as a step to slow drug-cost trend and capture more rebates.
The presentation closed with staff saying they will continue to refine plan designs and work with the health-alliance partners on medical strategies; no final contract award was recorded in the meeting minutes provided.
What happens next: staff and consultants will proceed with procurement follow-up and actuarial verification of savings; the consultants said changes to PBMs and mail-order vendors would produce different member ID cards and require communications to employees and dependents.
