Includes Medicare & Non-Medicare Plans

DECEMBER 15, 2022: The Group Insurance Commission held the final monthly commission meeting of the year on December 15th.  A major piece of business on the agenda was the selection of Pharmacy Benefit Manager (PBM).

In June of 2022 the GIC released the RFR for the procurement of a PBM for plan implementation for FY2024. Over the last six months the staff at the GIC have been reviewing the submissions for the vendors in preparation of making a recommendation to the full Commission. The current vendors for pharmacy benefits are Express Scripts, which covers over 300,000 active members and CVS Caremark/SilverScript, which covers over 100,00 Medicare members.

The GIC received 4 vendors who responded to the RFR. CVS Caremark (CVS), Express Scripts, Ingenio RX and Optum Rx. All of the vendors were evaluated across six categories. Across the categories CVS Caremark scored high for both the non-Medicare and Medicare populations. After an in-depth financial proposal review the recommendation from the procurement team was that CVS Caremark be selected as the PBM for both non-Medicare and Medicare populations. The Commission took a vote on the recommendation and CVS Caremark was selected as the PBM for both populations for FY2024.

The GIC will now begin the process of negotiating a contract with CVS and then begin the process of implementation for July 1, 2023, which will include activities during the annual open enrollment period for the GIC. Legislative Liaison Nancy McGovern added the following, “While prescription drug coverage remains the same for our Medicare retirees, those enrolled in the non-Medicare plans will see their coverage change from Express Scripts to CVS Caremark next July 1. We’ll be closely watching developments here to make certain the transition is smooth for the retirees affected.”

The selection of the PBM concludes the GIC’s yearlong procurement process for health and pharmacy vendors for FY2024. The next steps will be to secure contracts with the vendors and develop plan designs for the medical plans.

Out of pocket costs, such as prescription copayments have yet to be determined. The last increase took place in 2018, during the last procurement process nearly 5 years ago.

“To be clear, GIC enrollees will continue to use whichever retail pharmacy that you choose. CVSHealth is the benefits and mail order manager. No one will be forced to shop at a CVS retail store, unless it is for a 3-month supply which has to come through CVS,” explains Mass Retirees CEO Shawn Duhamel. “We also encourage retirees to shop around to find the best deals on the specific drugs you may take. Prices of individual drugs will differ from retailer to retailer, just like many other products. However, overall CVS had the best pricing among the four vendors submitting bids.

In addition to the PBM selection the Commission heard a report on PRELIMINARY RATES for the health plans for FY2024. The preliminary rates are based on the CURRENT plan options, plan designs, programs, and funding mechanism.  The projected aggregate increase is approximately 6.7%, with the low end projection being approximately 4% and the high end projection 8%. This means that on average there could be a 6.7% increase across the plans (all non-Medicare and Medicare plans) with some plans seeing lower or higher than the aggregate rate increase. It is important to remember that these are only preliminary rates and do not take into account any improvements from the PBM selection, medical trend assumptions or plan designs that could impact costs. 

Final decisions on plan types and designs and final rates will be on the agenda for the GIC as they begin 2023. We will share information as it becomes available.

Commissioners were also presented with an update on the Municipal Insurance Program. Currently 48 municipalities, regional school districts and authorities have enrolled their retirees, employees and survivors in the GIC. Local enrollment in this Program totals 68,720.

This year, 11 of the 48 local participants were up for renewal in the Program beginning next July 1. Those 11 had to notify the GIC by December 1 if they did not intend to renew but would be leaving the GIC as of next July 1.

Before the December 1 deadline, only one participant – Athol–Royalston Regional School District – notified the GIC that it would not be renewing and leaving the Program as of next July 1. The other10 local participants are remaining for a total of 47 in the Program beginning next July 1.

It’s noteworthy that next year (2023) there will be 19 participants that will be up for renewal. Again, these participants must notify the GIC by next December 1 if they will not be renewing.

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