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3. Stand -Alone Pharmacy — At the February 0 meeting, staff was directed to research the potential for a stand-alone Pharmacy. Our insurance broker has indicated that this option is best suited to larger employers (3,000-5,000 employees) due to the cost of hiring a Pharmacist. The cost to offer limited prescriptions at a wellness clinic is lowered through the use of a dispensary. Under supervision of a Medical Doctor, certain types of medications can be dispensed without the need to have a Pharmacist on staff. 4. Other Health Plan Adiustments — In previous years, numerous health plan adjustments were made to provide a savings to the health plan, such as increased copays, deductibles, and out-of- pocket maximums. With the assistance of our broker, staff will explore additional plan adjustments for consideration for fiscal year 2017/18. 5 Continued Phase-in of Employee Premium Adjustment — Proposal Number 5 for FY 2016/17 was to establish a premium split between the employer and employee and begin a two-year transition to reach the recommended premium split (90%/10% for Single Coverage and 75%/25% for Family Coverage). Based upon the recommended premium rates for FY 2016/17, an increase of $30/month for both Single Coverage and Family Coverage would be near the recommended premium splits 6. Continued Employer Premium Adjustments — As stated above, healthcare costs are projected to increase by about 9.0% per year. This represents an annual increase of $1.6 million on a countywide basis. Depending upon actual expenses, additional employer premium contributions may be needed. 7. Pharmacy PPO Adjustment — Prescription medications make up a significant portion of our total health plan expenditures. Last year, the health plan paid about $4.1 million for prescription medications (in addition to copays from employees). This is a significant portion of total expenditures (-23%) and these costs are rising faster than our overall health costs Therefore, this area represents a significant potential for savings. Out insurance broker has obtained an analysis of prescription medication expenses on the County's health plan for a one-year period by provider This analysis has shown that prices paid for the same prescription medicines can differ substantially at various retail pharmacies. Based upon the results of this analysis, staff recommends eliminating some/one provider from the PPO network for prescription medications. Summary and Conclusion The County Health Insurance Fund is currently in solid financial condition, however, continued losses similar to those experienced last fiscal year ($2.8 million) cannot be sustained. If adjustments are not made, the Health Plan will likely face a funding crisis over the next several years. Staff has presented a two-year plan above to address the current shortfall in order to ensure the long-term financial stability of the County health plan. Recommendation Staff recommends that the Board of Commissioners approve the proposed changes (Numbers 1 through 8) detailed above for fiscal year 2016/17. Staff additionally recommends that the Board approve the Potential Changes for fiscal year 2017/18 for further exploration. During next fiscal year, staff plans to present final recommendations for fiscal year 2017/18. Attachment: Health Plan Three Year Pro Forma 244