Title
From the Interim Director, Employee Benefits Division, requesting authorization to execute a three-year contract extension for administration of Milwaukee County’s prescription drug coverage with Medco. (Referred to the Committees on Finance and Audit and Personnel.)
Body
Issue/Background
In July of 2008, the Personnel Committee and the Finance & Audit Committee authorized the Director of the Employee Benefits Division to execute a contract with Medco Health Solutions for Pharmacy Benefits Management (PBM) services. The contract was awarded for January 1, 2009 through December 31, 2011, with the intention to reevaluate the market for 2012.
Since that time, Medco has proven their value as a partner in Milwaukee County’s efforts to control healthcare costs. The improvements to pricing have contributed to the overall healthcare savings realized in 2009 and 2010. Medco’s support through enhancements to our clinical management initiatives have also helped to ensure appropriate and efficient use of the funds the County invests in providing pharmacy coverage. The Employee Benefits Division is satisfied with the service Medco has provided to employees and administrators.
In December 2010, at the County’s request, Cambridge Advisory Group initiated discussions with Medco to explore an extension of the current agreement from 2011 through 2014. The primary objective of the extension was to secure immediate and ongoing price concessions from Medco in exchange for the additional guaranteed contract years.
In addition to the savings, the Employee Benefits Workgroup requested, and Medco has agreed to include the following stipulations:
§ Extending the contract term to expire on 12/31/2014 in order to keep the pharmacy contract expiration date consistent with the expiration of the next medical contract.
§ A market check provision allowing the County to solicit alternative bids following the 2012 plan year. Medco is required to keep their pricing within...
Click here for full text