(RALEIGH, N.C.) – State Treasurer Dale R. Folwell, CPA, and the State Health Plan (Plan) announced today that the State Health Plan Board of Trustees approved the contract award for Pharmacy Benefit Management (PBM) services. The estimated savings for the Plan under this new contract, as compared to the projected current contract, are $701.1 million.
After a competitive and transparent bid process, the contract was awarded to Caremark PCS Health, L.L.C. The intent of the Request for Purchase (RFP) was to secure a pharmacy benefit manager to provide superior services and support that will assist with meeting the State Health Plan’s strategic goals for improving members’ health, members’ experience and ensuring financial stability.
Caremark PCS Health, L.L.C. is the SHP’s current PBM. In that role it manages prescription drug benefits on behalf of the Plan, developing lists of covered medications and using its purchasing power to negotiate with drug manufacturers to obtain rebates and discounts that help control out-of-pocket spending and rising costs of pharmaceuticals.
“We are pleased to be able to offer continuity in our PBM services, avoiding member disruption as well as saving Plan members and taxpayers like them over $700 million,” Treasurer Folwell said. “All of the competitive bidders made excellent, cost-saving proposals but in the end the board selected the Caremark PCS Health proposal.”
The RFP was issued on May 21, 2021, and technical proposals were received on Aug. 10, 2021. Proposals were received from the following:
- Blue Cross Blue Shield of North Carolina with Prime Therapeutics
- Caremark PCS Health, LLC (CVS)
- Express Scripts, Inc.
- OptumRx, Inc.
The contract with CVS Caremark will be effective upon award with services beginning Jan. 1, 2023. The contract will expire Dec. 31, 2025, with the option to renew for two, one-year terms. The total cost of the contract including member copays over the three-year term is $3.394 billion.
The State Health Plan, a division of the Department of State Treasurer, provides health care coverage to more than 727,000 teachers, state employees, retirees, current and former lawmakers, state university and community college personnel, and their dependents.