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July 8, 2008
ORANGE COUNTY 2009 MEDICAL & DENTAL
PLAN CONTRACTS
PRESENTATION OUTLINE
•BACKGROUND
•MEDICAL \ PHARMACY RFP •DENTAL RFP
•ACTION REQUESTED
BACKGROUND
BACKGROUND - MEDICAL
• County moved to self-funded medical in 2007, and model is working well
- $7.9 million savings in plan year 2007
• Medical Plan Oversight Committee oversees plan
• Benefits Consultant RobinsonBush works with oversight committee and HR on key benefits initiatives
BACKGROUND - MEDICAL
• County is in 5th year of contract with UnitedHealthcare
• Formal procurement required every 5 years
• Oversight Committee worked with Consultant and Purchasing & Contracts on medical RFP development
BACKGROUND - DENTAL
• Dental Plan is fully insured and employee funded
• Employees are happy with current Dental plan
• Dental insurance provided by the Standard
BACKGROUND - DENTAL
• County is in 5th year of contract with the Standard
• Formal procurement required for plan year 2009
MEDICAL / PHARMACY RFP
MEDICAL / PHARMACY RFP
• Requested Administrative Services Only (ASO) proposals for self-funded medical
• Asked for both integrated medical / pharmacy and pharmacy carve out options
• Three providers proposed integrated programs – Aetna, Cigna and UnitedHealthcare (UHC)
MEDICAL / PHARMACY RFP
• Four Additional Pharmacy Benefits Managers (PBM) proposed pharmacy carve outs – Caremark, Express Scripts, Medco and Walgreens
• Benefits Consultant evaluated medical & pharmacy proposals and reported findings & recommendations
• Procurement Committee found:
– UHC’s claims pricing and admin fees lower than other two providers
- UHC has good reputation with County and other references checked
- UHC will provide employee wellness support to include $150,000 annual to fund DM / wellness programs
MEDICAL RFP
PHARMACY RFP
• Procurement Committee found:
Express Scripts - Estimated annual costs lower than all
other providers
- Largest pharmacy network
- Offers additional services – quarterly reports and enrollment support
- Offers employee education & support
DENTAL RFP
DENTAL RFP
• Benefits Consultant evaluated dental proposals and reported findings & recommendations
• Seven dental insurers provided proposals
- Aetna, Cigna, Delta Dental, UHC, Humana, Solstice and Standard
DENTAL RFP
• Procurement committee found:
Standard
- Proposed rates competitive with other providers
- Has largest # of top 100 providers
- Offered 2 year rate guarantee & potential for year 3
- Noted no disruptions to current plan design
ACTION REQUESTED
• Approve Procurement Committee’s recommendation to select UnitedHealthcare as the County’s self-funded medical ASO Provider
• Approve Procurement Committee’s recommendation to carve out Pharmacy and select Express Scripts as the County’s self-funded Pharmacy Benefit Manager
• Approve Procurement Committee’s recommendation to select Standard as the County’s Dental Insurance Provider
July 8, 2008
ORANGE COUNTY 2009 MEDICAL & DENTAL
PLAN CONTRACTS