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Agenda Item
ASR
Control 21-001017 |
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MEETING DATE: |
12/07/21 |
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legal entity taking action: |
Board of Supervisors |
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board of supervisors
district(s): |
All Districts |
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SUBMITTING
Agency/Department: |
County Executive Office (Approved) |
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Department contact
person(s): |
Kim Derrick (714) 834-2564 |
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Diana Banzet (714) 834-2978 |
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Subject: Amendment Number Two to
Contract with OptumRx, Inc.
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ceo CONCUR |
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Clerk of the Board |
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Concur |
Approved Agreement to Form |
Consent Calendar |
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3 Votes Board Majority |
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Budgeted: Yes |
Current Year Cost:
$0 |
Annual Cost:
See Financial Impact Section |
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Staffing Impact: |
No |
# of Positions:
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Sole Source:
No |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 01/26/2021
#25, 07/28/2020 #10 |
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RECOMMENDED ACTION(S):
Authorize the Chief Human Resource Officer, or designee, to execute Amendment Number Two with OptumRx, Inc. for Pharmacy Benefit Management and Claims Administration to include the Additional Services fee in Attachment B-Cost/Compensation for Contract Services, make updates in Attachment A-Scope of Work and amend the Contract Performance Guidelines regarding Retail Paper Claims Processing Time and Rebate Payment Timeliness in Attachment D-Contract Performance Guidelines effective October 1, 2021, through December 31, 2023.
SUMMARY:
Approval of Amendment Number Two to the Contract with OptumRx, Inc. will continue to allow the County to work with OptumRx, Inc. for the administration of the Clinical Services and Utilization Management Programs as part of the Pharmacy Benefit Management and Claims Administration Program for the four self-funded PPO Plans, and enable Optum Rx, Inc. to offer Diabetes High-Risk Counseling to members diagnosed with diabetes.
BACKGROUND INFORMATION:
OptumRx, Inc. (OptumRx) is the Pharmacy Benefit Manager for the self-insured PPO health plans the County offers to employees and retirees. The two current self-insured active employee PPO health plans are Wellwise Choice and Sharewell Choice with a total of 3,570 enrolled employees, and the two self-insured retiree PPO health plans are Wellwise Retiree and Sharewell Retiree, with a total of 2,490 enrolled retirees.
The contract with OptumRx for Pharmacy Benefit Management and Claims Administration (Contract) became effective on January 1, 2021. Amendment Number Two to Contract is requested to modify Attachment B to include the Additional Services fee for Diabetes High-Risk Counseling. The addition of the Diabetes High-Risk Counseling will allow OptumRx to offer these services to members diagnosed with diabetes. Members, who sign up for the counseling, will receive coaching on diet, nutrition, weight loss, in addition to a medication review. The goal of the program is for members to achieve a Hemoglobin A1C level below 8 percent. The County will receive quarterly reporting to monitor utilization and engagement in the program. After 18 months of the program implementation, clinical outcome reporting will be available to measure the effectiveness of the program. The cost of the services will be paid with the annual Pharmacy Management Allowance, which must be utilized within the applicable contract year and offsets the cost of actions intended to maximize the value of the pharmacy program.
Additional changes include updates to Attachment A, Scope of Work, to remove language inadvertently carried over from the Request for Proposal model contract and align rebate/credit payment terms with the Contract Performance Guidelines in Attachment D from 90 days to 120 days of close of calendar year.
Prior Board of Supervisors (Board) Actions:
On January 26, 2021, the Board approved Amendment Number One to include the Additional Service fees and Pharmacy Management Allowance, update the Specialty Discount Guarantee and amend Contract Performance Standards effective January 1, 2021.
On July 28, 2020, the contract with OptumRx for the administration of the Pharmacy Benefit Management and Claims Administration program for the self-insured PPO health plans effective January 2, 2021, through December 31, 2023, with the option to renew for two additional one-year terms, was approved by the Board.
The contract includes subcontractors. See Attachment C for information regarding subcontractors and the Contract Summary Form. The Contractor's performance has been confirmed as at least satisfactory. Human Resource Services has verified there are no concerns that must be addressed with respect to Contractor's ownership/name, litigation status or conflicts with County interests. The Orange County Preference Policy is not applicable to this contract award.
FINANCIAL IMPACT:
The addition of the diabetes High-Risk Counseling to members diagnosed with diabetes is projected to cost up to $25,000 annually depending on the number of members participating. This expense is offset by the projected annual $30,000 pharmacy management allowance, resulting in no net cost to the County.
It is also anticipated the remainder of the changes to the scope of work will not change the original estimated claims cost or the amount of rebates received.
Appropriations and revenue for this Contract are included in the Internal Service Fund 292 FY 2021-22 Adopted Budget and will be included in the budgeting process for the future fiscal years. This Contract is contingent upon funding by the County during the term of this Contract. If such funding is not approved, this Contract will be immediately terminated without penalty to the County.
STAFFING IMPACT:
N/A
ATTACHMENT(S):
Attachment A - Amendment Number Two to Contract with
OptumRx, Inc.
Attachment B - Redline Changes to Contract with OptumRx, Inc.
Attachment C - Contract Summary Form