The State Health Benefits Program Design Committee (PDC) met on July 26, 2023. They focused on the issue of rising service costs, identified as the main factor for the uptick in state health benefits expenses.
The committee passed nine resolutions for the 2024 Plan Year including:
- 2023-2: Reduction in Specialty Copay, which continues the reduction of members’ cost share for specialty drugs;
- 2023-3: Formulary Management and Out of Network Physical Therapy, which continues the formulary management and structured out of network physical therapy reimbursements approved in 2016;
- 2023-4: Mail Order Incentive and $0 Copay for Generic Mail Order Prescription Drugs, which continues the $0 copay for prescriptions for generic drugs filled through OptumRx’s Mail Order Pharmacy by active members;
- 2023-5: Generic Substitution Preference, which continues the incentivized use of cost-effective generic drug products;
- 2023-6: Copay Reduction for Retiree Mail Order Preferred Brand Prescription Drugs, which continues retiree copayments in the Retirement Prescription Drug Plan associated with the PPO 10 and 15 medical plans set at $28 per 90-day prescriptions for prescriptions for preferred medication filled through a mail service for Plan Year 2023;
- 2023-7: Tiered Network Plan Financial Incentive Pilot Program, which continues the financial incentive for new Tiered Network Plan enrollees;
- 2023-8: Point Solutions, which accepts the Division of Health Benefits points solutions evaluations and directs the Division to use best efforts to achieve their goal and provide regular rolling reports to the PDC; and
- 2023-9: Reference Based Pricing, which requires the PDC to use best efforts to develop and finalize a more detailed resolution regarding Reference Based Pricing pilot program for the State Health Benefits Program by its September 2023 meeting; and
- 2023-10: Medical Specialty Rx, which requires the PDC to develop and finalize plan design changes to address the rising costs of medical and/or specialty pharmacy prescription drug benefits with a focus on a multi-phase, incremental approach to reforms, by its October 2023 meeting, while also continuing to analyze longer-term, structural reforms.
The committee discussed Health Reimbursement Arrangements (HRA), specifically how municipalities utilize HRA to shift and save costs. Further discussion will likely occur at the September meeting.
An update on the Superconciliation process was discussed to highlight the outstanding issues between management and labor.
With the passage of the resolutions, the State Health Benefits Program Rate Renewal Meeting is scheduled for July 31 where, as we previously reported, it is expected that 2024 Plan Year Rates will be approved with a 7.4% increase for the Local Government Employer Group.
Contact: Andrew LaFevre, Legislative Analyst, email@example.com, 609-695-3481, x116.