AGENDA State and Public School Life and Health Insurance Board January 17, 2017 1:00 p.m. EBD Board Room – 501 Building, Suite 500 I. Call to Order .........................................................................Carla Haugen, Chairman II. Approval of Dec. 15, 2016 & Dec. 21, 2016 Minutes ...........Carla Haugen, Chairman III. ASE-PSE Financial December, 2016 ................. Marla Wallace, EBD Fiscal Officer IV. Benefits Sub-Committee Report .............................. Janis Harrison, Board Member V. DUEC Report. ............................................... Chris Howlett, EBD Executive Director VI. Director’s Report .......................................... Chris Howlett, EBD Executive Director Upcoming Meetings February 21, 2017, March 21, 2017, April 18, 2017 NOTE: All material for this meeting will be available by electronic means only [email protected]. Notice: Silence your cell phones. Keep your personal conversations to a minimum. Observe restrictions designating areas as “Members and Staff only”
Transcript
AGENDA
State and Public School Life and Health Insurance Board
January 17, 2017
1:00 p.m.
EBD Board Room – 501 Building, Suite 500
I. Call to Order ......................................................................... Carla Haugen, Chairman
II. Approval of Dec. 15, 2016 & Dec. 21, 2016 Minutes ........... Carla Haugen, Chairman
And Health Insurance Board Meeting Special Board Meeting Minutes
January 17, 2017
The 168th meeting of the State and Public School Life and Health Insurance Board (hereinafter called the Board), met on January 17, 2016 at 1:00 p.m. in the EBD Board Room, 501 Woodlane, Suite 500, Little Rock, AR 72201.
Dr. John Kirtley Lori Freno-Engman Janis Harrison - phone
Renee Mallory Dr. Tony Thurman Shelby McCook
Dr. Joseph Thompson Robert Boyd Dr. Andrew Kumpuris
Chris Howlett, EBD Executive Director, Employee Benefits Division
OTHERS PRESENT: Ethel Whittaker, Gretchen Baggett, Eric Gallo, Ellen Justus, Terri Freeman, Drew Higginbotham, Marla Wallace, Matt, Turner, Cecilia Walker, Stella Greene, EBD; Kristi Jackson, Jennifer Vaughn, ComPsych; Tracy Gaddie, ABCBS; Sylvia Landers, Minnesota Life; Jackie Baker, ASP; Scott Yielding, DPAS; Ronda Walthall, AR Highway & Transportation Dept; Karyn Langley, Qual Choice; Andy Davis, Arkansas Democrat-Gazette; Nina Reed, ActiveHealth; Wayne Whitley, AHTD; Dwight Davis, UAMS; Will Cottrell, DHS; Allison Drennon, Dylan Howell, Insurance Advantage; Bill Clary, H&H; David Kizzia, AEA; Marc Watts, ASEA; Randy Loggins, Mike Motley, Elizabeth Whittington, ACHI; Treg Long, ACS; Suzanne Woodall, Bill Flaring, MedImpact; Marc Bagby, LILLY; Jon Arnett, Genzyme; Jessica Akins; Bethany Boyle, ASBP; Greg Jones, Mainstream; Pam Lawrence, AHH; Robyn Keene, AAEA; Sean Seago, Merck
CALL TO ORDER: Meeting was called to order by Carla Haugen, Chair
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Board Meeting
January 15, 2016
I. APPROVAL OF MINUTES: by Carla Haugen, Chair
Haugen asked for a motion to approve the December 15 and 21, 2016 minutes.
McCook motioned for adoption of the minutes. Harrison seconded; all were in favor.
Minutes approved.
II. FINANCIALS: by Marla Wallace, EBD Chief Fiscal Officer
Wallace reported financials for December 2016. For December PSE, five (5) weeks of medical and pharmacy claims were paid. The FICA savings for the month is $487,000. There was a net loss of $3.375 million for the month. The net gain for the year-to-date is $20.22 million. Net assets available are $52.299 million. For ASE the month of December, five (5) weeks of medical and pharmacy claims were paid. The net loss was $917,000 for the month. The net gain for the year-to-date is $20.108 million. The fifth week of claims were $4.879 million. Net assets available are $20.467 million. At the request of the Board, an additional report was provided, which outlines the projected amount of medical claims, pharmacy claims, and expenses. Also, the report provides projected and actual amounts for each month and year-to-date.
Benefits Sub-Committee Report: by Janis Harrison, Board Member
The following report resulted from a meeting of the Benefits Sub-Committee on January 13, 2017, with Jeff Altemus presiding.
Topics Discussed:
- December Financials - Wallace reported the financials for December 2016. Please see the attached report.
- ACHI Updates - Health Risk Assessment Analysis, Obesity, and Patient Center Medical Home Data Analysis.
- ActiveHealth Wellness update
- Catapult Wellness update
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Board Meeting
January 15, 2016
Harrison reported the committee had had several presentations from ActiveHealth and Catapult. ActiveHealth is EBD's new medical management vendor. They have been speaking of information that would be in addition to our current contract. It would be a screening for members and spouses for an additional $60. Catapult’s cost would be $130 per member or spouse. It is more of a preventative check-up and not just a screening.
There haven’t been any decisions to bring before the board at this time. The Division is still in discussion in terms of what’s best for the plan and the members. We have 89% wellness compliance with our members and spouses. The focus remains if we seek to reach those 11% that are noncompliant or find a better way to deliver services to our members.
McCook inquired about whether this would be for the members, or will it include dependents and spouses as well. Howlett said It hasn't been discussed at this time; there is still a need for comparing the two before a decision is made.
McCook would like an outline of how many people are receiving a check-up before the Division seek to implement a $75 discount.
DUEC REPORT: by Chris Howlett, EBD Executive Director
Howlett reported on the recent Special DUEC meeting. The purpose of the special meeting is to consider recommendations for EBD’s future, opioid-related policies in light of the March 2016 “CDC Guidelines for Prescribing Opioids for Chronic Pain __United States, 2016”. The topics up for discussion are: weight to be placed on the CDC guidelines, working definitions for targets, general restrictions, new prescriptions, and ongoing prescriptions for established chronic pain. There will be a full recommendation for the Board on February 21st
DIRECTOR’S REPORT: by Chris Howlett, EBD Executive Director
The Benefits Committee requested that Howlett further investigate the UAMS Telemedicine program, which is currently under discussion. The division is communicating with UAMS on the infrastructure and logistics to get Kiosks in some of the rural schools as well as online. Another key component is inquiring if the plan would qualify for zero cost instead of a provider billed claim. There has been a ruling on Mandate 1557. A Texas Judge co-joined both cases, and the appeal decision will be heard January 20, 2017. After the judgment, the Division will take steps to comply. ActiveHealth and EBD are transitioning and is set to go live 03/01/2017.
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Board Meeting
January 15, 2016
The transition from WageWorks to Datapath is going well. There will be a clarified language on those fees. As discussed, there are no fees for anything that isn’t member initiated. Howlett reported that 80 ASE and 80 PSE members have enrolled in the Bariatric program thus far. The program terminates 12/31/2017. However, a new curriculum may need to be reviewed in the 2018 General Assembly Session and possibly a new bill. Dr. Thompson requested additional information regarding opioids and the employee assistance program. Dr. Bemberg stated from a DUEC perspective they are focusing on new start prescriptions first. McCook inquired if there had been any communication in the current legislative session purposing a bill regarding opioid limits? Dr. Kirtley reported there has been communication regarding prescription monitoring and required checks. Dr. Kirtley also said there had been the discussion with the Medical Board and the Medical Society regarding the CDC guidelines. However, there has been no action to adopt any policies.
New Topics:
Dr. Kirtley reported on the article from CVS and securing epinephrine auto-injectors with Adrenaclick at the price of about $110. Mylan Pharmaceuticals produces an authorized generic with the same doses that are equivalent to the EpiPen with a different label but is half the cost. It is not an "A" rated generic due to not having to fill out additional documents for the FDA. It is “BX” rated meaning a pharmacist cannot automatically substitute it. Dr. Thompson inquired who is responsible for the BX rating? Dr. Kirtley reported the issue is with the FDA. The argument reads; If there is an authorized Generic, a Brand Company has the authorization to produce the drug, so it will not have to apply for additional documents. Therefore, the FDA does not complete a review explaining that it is an equivalent product. Dr. Kirtley reported the Orange Book explicitly states that “an authorized generic is considered to be therapeutically equivalent to the branded product, even if the branded product is a single source or coded as non-equivalent." Dr. Kirtley reported in 2016 3rd Quarter there were 411 claims paid at $250,000, which equates to the Brand named priced at $730.00 and the Generic Brand is $375.00. If the plan covered all named brand, the cost would be $300,000.
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Board Meeting
January 15, 2016
Dr. Kirtley motioned to exclude the name brand EpiPen and cover the equivalent generic (pharmacists will have to get approval to dispense) at a Tier 2 copay and move the Adrenaclick to Tier 3. Harrison seconded.
Harrison inquired what is the process for pharmacists to dispense the product? Kirtley stated that the pharmacist would need to call the prescriber and obtain approval by asking if the plan can substitute the equivalent generic that is produced by the same company. Because of the rating, they are looking to see if there is a potential legislative or regulatory fix where by the innovator company can produce the drug and modify the label, and then it may be considered as a different company and coded as equivalent. McCook requested that copies of Dr. Kirtley’s letter regarding the Orange book policies be included in the minutes. Howlett inquired, the effective date for the change is? Kirtley stated that it would be 90 days from today. Motion approved Dr. Thompson motioned to draft a letter through the Arkansas Medical Society to send their members that would explain how to prescribe the alternative drug and that it’s going into effect. McCook seconded. Motion approved.
Howlett asked Dr. Kirtley if he would be responsible for drafting the letter, providing the information for the minutes, and sending the letter? Dr. Kirtley replied, yes. Meeting adjourn.
BASIC
CLASSIC
PREMIUM
PRIMARY
TOTAL
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
(7,560,000)$
(5,040,000)$
Arkansas State Employees (ASE) Financials - January 1, 2015 through December 31, 2015
EMPLOYEE ONLY EMPLOYEE + DEPENDENTS
ACTIVES RETIREES MEDICARE TOTAL ACTIVES RETIREES MEDICARE TOTAL
1207 26 1233 2032 42 2074
2929
23741 2183 25924 41406 2821 44227
1679 64 1743 2839 90
11843 12271
26627 2482 9041 38150 46277 3381 11843 61501
209 9041 9250 428
7,831,375$ 95,297,662$
Other 730,081$ 12,228,949$
REVENUES & EXPENDITURES
Funding
Current
Month
Year to Date
(12 Months)
State Contribution 14,694,568$ 174,319,824$
Expenses
Medical Expenses
Total Funding 24,227,691$ 293,506,436$
Allocation for Actives - Plan Year 2015 971,667$ 11,660,000$
Employee Contribution
1,148,247$ 13,182,703$
Refunds -$ (89,076)$
Claims Expense 17,464,371$ 168,366,261$
Claims IBNR -$ -$
355,504$ 6,707,010$
RX Claims 7,300,147$ 74,030,721$
RX IBNR -$ -$
Employee Assistance Program (EAP) 55,467$ 671,441$
Pharmacy Expenses
Life Insurance 54,118$
Medical Administration Fees
Net Income/(Loss) (2,358,632)$ 27,455,038$
Total Expenses 26,586,323$ 266,051,398$
RX Administration 208,469$ 2,527,398$
Plan Administration
Bank Account 2,358,152$
State Treasury 86,333,482$
BALANCE SHEET
Assets
Accounts Receivable 18,058$
Total Assets 93,905,678$
Due from Cafeteria Plan 5,195,886$
Due from PSE 101$
Due to Cafeteria 512$
Due to PSE -$
Liabilities
Total Liabilities 26,506,206$
Net Assets 67,399,473$
Health IBNR 24,700,000$
RX IBNR 1,800,000$
Premiums for Plan Year 1/1/16 - 12/31/16 ($3,600,000 + $12,600,000) (16,200,000)$
January 13, 2017 Executive Director Board of Pharmacy
RE: Therapeutic Equivalence of EpiPen® Auto-Injector and Mylan’s Authorized Generic
Dear Executive Director: I’m writing on behalf of Mylan Specialty with regard to the authorized generic version of the EpiPen® (epinephrine injection, USP) Auto-Injector that is now available. Questions have arisen in some states regarding the substitutability of the authorized generic, apparently based on a misunderstanding about the product’s therapeutic equivalence to the EpiPen Auto-Injector. The purpose of this letter is to help address any such questions and explain that the products are therapeutically equivalent, with the goal of supporting pharmacy dispensing of the authorized generic in response to prescriptions written for the EpiPen Auto-Injector. As you may know, the authorized generic is being offered at a significantly reduced WAC price from the branded product (more than 50% lower). This can provide meaningful benefits to patients and payors – but only if the authorized generic is dispensed. It has come to our attention that, in a number of states where the pharmacy laws permit substitution of generic drug products that are therapeutically equivalent to the branded product, some pharmacies have hesitated to dispense the EpiPen authorized generic. This hesitation appears to be based on the mistaken belief that, because the authorized generic doesn’t appear in FDA’s Orange Book with an “A” rating to the EpiPen Auto-Injector, it isn’t therapeutically equivalent to the branded product. Like all authorized generics, the EpiPen authorized generic isn’t what some call a “true” generic; it isn’t approved under its own application (typically an ANDA) and listed individually in the Orange Book with an “A” rating reflecting an FDA determination that the product is therapeutically equivalent to the branded product. That’s because the authorized generic isn’t a generic copy of the EpiPen Auto-Injector; it is the same drug product as the EpiPen Auto-Injector – just without the EpiPen name on the product label and labeling. The authorized generic is made at the same facility, by the identical manufacturing process and to the identical specifications as the EpiPen Auto-Injector, and marketed and distributed under the FDA approval for the EpiPen Auto-Injector – which is why it’s not separately listed in the Orange Book, and therefore doesn’t have a therapeutic equivalence code relative to the EpiPen Auto-Injector.1
1 “Authorized generic” is defined in FDA regulations at 21 CFR 314.3(b), which is available at
Although the EpiPen authorized generic isn’t listed in the Orange Book with an “A” rating, it is therapeutically equivalent to the branded product. It contains the identical epinephrine formulation, in the same strengths, presented in the same auto-injector, and delivering the drug to the identical rate and extent. It therefore meets FDA’s regulatory definition of “therapeutic equivalent,” because it is a “pharmaceutical equivalent” (same active ingredient in the same strength, dosage form, and route of administration) that is also bioequivalent (delivering active ingredient to the same rate and extent) and “can be expected to have the same clinical effect and safety profile.”2 Consistent with this, the Orange Book explicitly states that “an authorized generic[ ] is considered to be therapeutically equivalent to the [branded] product, even if the [branded] product is single source or coded as non-equivalent.”3 This is directly applicable to the EpiPen Auto-Injector and the authorized generic. The EpiPen Auto-Injector is listed in the Orange Book with a “BX” rating, but that reflects the fact that the other approved epinephrine auto-injectors (Adrenaclick, Auvi-Q) are not therapeutically equivalent to the EpiPen Auto-Injector; it is not a statement regarding the relationship between the EpiPen Auto-Injector and its authorized generic, which are therapeutic equivalents, for the reasons discussed above. We are contacting you with this information in anticipation of any questions, because we want to encourage the broadest possible availability of the EpiPen authorized generic. With that in mind, please don’t hesitate to contact me with any questions, or if we can provide further assistance with regard to dispensing and use of the EpiPen authorized generic. Sincerely, S. Wayne Talton Mylan Head, Global Regulatory Affairs Phone: 304-554-6551 Email: [email protected]
2 21 CFR 314.3(b) (definition of “therapeutic equivalents”). The regulatory definitions of “pharmaceutical
equivalents,” “therapeutic equivalents” and “bioequivalence” are found at 21 CFR 314.3(b). The preface to the
Orange Book (Section 1.2, “Therapeutic Equivalence-Related Terms”) also contains similar definitions of the terms.
It is available at http://www.fda.gov/downloads/Drugs/Development ApprovalProcess/UCM071436.pdf. 3 Orange Book preface at page xi.
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