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HomeMy WebLinkAboutAdden 3 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 CAG-09-184, Adden 3-17 AMENDMENT NO. 2 TO PHARMACY BENEFIT MANAGEMENT SERVICES AGREEMENT This Amendment No. 2 (this "Amendment"), is entered into by and between Envision Pharmaceutical Services, LLC ("Envision"), and City of Renton, Washington ("Plan Sponsor"). BACKGROUND Envision and Plan Sponsor are parties to a Pharmacy Benefit Management Services Agreement dated October 1st, 2009 (the "Agreement"), under which Envision provides PBM Services to Plan Sponsor; and The parties desire to amend the Agreement, and therefore Envision and Plan Sponsor agree as follows: 1. Any capitalized term used and not identified in this Amendment shall have the same meaning as defined in the Agreement. 2. The term of the Agreement shall extend to January 1st, 2020. 3. Exhibit 1 of the Agreement shall be deleted in its entirety and replaced with Exhibit 1 set forth below. 4. This Amendment shall be effective January 1st, 2017("Effective Date"). 5. All other terms or provisions of the Agreement not modified by this Amendment or any other amendments or addenda shall remain unchanged. IN WITNESS WHEREOF, Envision and Plan Sponsor have executed this Amendment as of the Effective Date above. For ENVISION: For PLAN SPONSOR: �-Docusigned by: n / By 3�aazs�D7aGdF3 _ By: 6719 Matthew A. Gibbs, Pharm D. Maria Boggs President, Commercial & Managed Markets Print Name& TitloBenefits Manager /City of Renton Amendment No.2 091216 ©Envision Pharmaceutical Services,LLC Page 1 of 6 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 EXHIBIT 1* FEES AND PRICING Drug Pricing and Dispensing Fee Guarantees(") Supply/Source BRAND GENERIC Drug Price(B) Dispensing Drug Price(c) Dispensing For Contract Year (Annual Average Fee(D) (Annual Average Fee(D) 2017 Effective Rate (Annual Effective Rate (Annual Guarantee) Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a AWP minus 15.90% $1.20 AWP minus $1.25 Retail Pharmacy 78.00% 84 Days' Supply(or greater) at a Retail AWP minus AWP minus 20.00% N/A Pharmacy(non-Mail 79.00% N/A Order) Mail Order Pharmacy (at Costco Mail Order AWP minus 21.75% N/A AWP minus Pharmacy) 82.00% N/A Specialty Pharmacy(at Costco Specialty (Pass-Through of Contract Rate with Dispensing Pharmacy) Pharmacy) Drug Price(B) Dispensing Drug Price(c) Dispensing For Contract Year (Annual Average Fee(D) (Annual Average Fee(D) 2018 Effective Rate (Annual Effective Rate (Annual Guarantee) Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a -AWP minus 16.00% $ AWP minus $1 25 Retail Pharmacy 20 78.00% 84 Days' Supply(or greater)at a Retail AWP minus AWP minus 20.00% N/A Pharmacy(non-Mail 79.25% N/A Order) Mail Order Pharmacy (at Costco Mail Order AWP minus 21.75% N/A AWP minus Pharmacy) 82.00% N/A Specialty Pharmacy(at (Pass-Through of Contract Rate with Dispensing Pharmacy) Costco Specialty /City of Renton Amendment No.2 091216 0 Envision Pharmaceutical Services,LLC Page 2 of 6 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 Pharmacy) Drug Price(B) Dispensing Drug Price(c) Dispensing For Contract Year (Annual Average Fee(D) (Annual Average Fee(D) 2019 Effective Rate (Annual Effective Rate (Annual Guarantee) Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a AWP minus 16.10% $1.20 AWP minus $1.25 Retail Pharmacy 78.00% 84 Days' Supply(or greater) at a Retail AWP minus 20.00% N/A AWP minus Pharmacy(non-Mail 79.50% N/A Order) Mail Order Pharmacy (at Costco Mail Order AWP minus 21.75% N/A AWP minus Pharmacy) 82.00% N/A Specialty Pharmacy(at Costco Specialty (Pass-Through of Contract Rate with Dispensing Pharmacy) Pharmacy) (A)Calculated price using the applicable negotiated contract rate(i.e. AWP or MAC rate, or U&C Price) for the designated Network. The AWP discounts shown in the table above are Annual Average Effective Rates using current Medi-Span published values. If the calculated price is lower than the allowable amount under any state Medicaid "Favored Nations" rule, Envision shall pass-through, and Plan Sponsor shall pay, the Medicaid allowable amount. (6) Annual Average Effective Rate for Brand Drugs is calculated using the actual price paid by Envision (before deducting earned Manufacturer Derived Revenue) to Participating Pharmacies in the designated Network,plus any Cost Share, (the Ingredient Cost) for all Brand Drug Claims(including Claims paid at the U&C Price) during a Contract Year, excluding (i) Compound Drugs; (ii) drugs dispensed at a Specialty Pharmacy; (iii) Claims from non-Participating Pharmacies, LTC pharmacies, or government owned or operated pharmacies (e.g. Veterans Administration); (iv) Claims paid at government required amounts (e.g. Medicaid); (v) 340B Claims; (vi) non-Prescription Drugs; and (vii) Claims from Plan Sponsor's owned pharmacies,if any. (c) Annual Average Effective Rate for Generic Drugs is calculated using actual price paid by Envision to Participating Pharmacies in the designated Network, plus any Cost Share, (the Ingredient Cost) for all Generic Drug Claims (including Claims paid at the U&C Price) during a Contract Year, excluding (i) Compound Drugs; (ii) drugs dispensed at a Specialty Pharmacy; (iii) Claims from non-Participating Pharmacies, LTC pharmacies, or government owned or operated pharmacies(e.g. Veterans Administration); (iv) Claims paid at government required amounts (e.g. Medicaid); (v) 340B Claims; (vi) non-Prescription Drugs; and(vii)Claims from Plan Sponsor's owned pharmacies, if any. (D)Annual Average Dispensing Fee is the average per Claim fee for all Claims by Envision to Participating Pharmacies in the designated Network (including Claims paid at the U&C Price) during a Contract Year, excluding (i) Compound Drugs; (ii) drugs dispensed at a Specialty Pharmacy; (iii) Claims from non- Participating Pharmacies, LTC pharmacies, or government owned or operated pharmacies (e.g. Veterans Administration); (iv) Claims paid at government required amounts (e.g. Medicaid); (v) non-Prescription /City of Renton Amendment No.2 091216 0 Envision Pharmaceutical Services,LLC Page 3 of 6 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 Drugs; and(vi)Claims from Plan Sponsor's owned pharmacies,if any. Annual Average Effective Rate and Annual Average Dispensing Fee Guarantee Plan Sponsor acknowledges that the Annual Average Effective Rates and Annual Average Dispensing Fees specified in this Exhibit 1 are conditioned upon Plan Sponsor's adherence to certain conditions under this Agreement and that the actual Annual Average Effective Rates and Annual Average Dispensing Fees will also depend on Plan Sponsor's drug utilization and mix of Participating Pharmacies. The Annual Average Effective Rates and Annual Average Dispensing Fees guarantees set forth in Exhibit 1 shall be deemed to have been satisfied if the discounts passed through to Plan Sponsor for all Claims during the Contract Year are equal to or more favorable, in the aggregate, than the drug pricing and dispensing fee guarantees stated for each drug type or category individually. If the amounts paid by Plan Sponsor for all Claims during the Contract Year are less favorable, in the aggregate and after application of any additional offsets allowed under this Agreement, than the combined Annual Average Effective Rates and Annual Average Dispensing Fees stated in Exhibit 1, Envision shall credit Plan Sponsor with the difference as set forth below. Envision shall not be liable to Plan Sponsor for shortfalls in guaranteed Annual Average Effective Rates or Annual Average Dispensing Fees if(i) Plan Sponsor makes a change to the Benefit Plan at any time (regardless of whether or not such change is required by law); (ii) the configuration of System edits is modified by Plan Sponsor; (iii) Plan Sponsor does not adhere to the Formulary; (iv) the utilization data provided by Plan Sponsor (or Plan Sponsor's agent) upon which the calculation of guarantees were based is inaccurate, incomplete; (v)there is a substantial change in drug utilization patterns of Covered Individuals; or(vi)Plan Sponsor terminates before completion of the applicable, full Contract Year. In addition, Plan Sponsor agrees that Envision's liability to Plan Sponsor for shortfalls in financial guarantees, in the aggregate, for any Contract Year shall be limited to amounts paid by Plan Sponsor to Envision for Administrative Fees during the applicable Contract Year, and Plan Sponsor has no right of offset to withhold any payment due Envision under this Agreement for any amounts Plan Sponsor believes are owed by Envision for financial guarantees. Annual Average Manufacturer Derived Revenue Guarantee(El(F)•tc>,(H) For Contract Year 2017: • For 30 day supply of Brand Drugs at a Retail Pharmacy-$48.00 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at a Retail Pharmacy-$100.00 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at Costco Mail Order Pharmacy-$160.00 per paid Brand Drug Claim • For Specialty Brand Drugs-$250.00 per paid Specialty Brand Drug Claim For Contract Year 2018: • For 30 day supply of Brand Drugs at a Retail Pharmacy-$54 07 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at a Retail Pharmacy-$120.13 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at Costco Mail Order Pharmacy-$186.64 per paid Brand Drug Claim • For Specialty Brand Drugs-$250.00 per paid Specialty Brand Drug Claim For Contract Year 2019: • For 30 day supply of Brand Drugs at a Retail Pharmacy-$60.23 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at a Retail Pharmacy-$132.51 per paid Brand Drug Claim • For 84 days' supply of Brand Drugs at Costco Mail Order Pharmacy-$207.73 per paid Brand Drug Claim • For Specialty Brand Drugs-$250.00 per paid Specialty Brand Drug Claim (E)Manufacturer Derived Revenue guarantees are stated as annual average amounts per Contract Year. (F)Guarantees require Plan Sponsor to maintain a Benefit Plan that has a tier structure with a minimum$20 differential in Cost Share between preferred Brand Drugs and non-preferred Brand Drugs. (G)340B Claims,Claims not eligible for Manufacturer Derived Revenue(e.g. Vaccines, Compounds, Direct /City of Renton Amendment No.2 091216 ®Envision Pharmaceutical Services,LLC Page 4 of 6 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 Member Reimbursement Claims, etc.), OTC drug Claims (with the exception of diabetic testing strips and meters), and Claims from any Plan Sponsor owned or affiliated pharmacy which is not a Participating Pharmacy, shall be excluded from the calculation of the guarantees above. (H)Guarantees require Plan Sponsor to utilize current Envision Standard Formulary. Plan Sponsor acknowledges that the annual average Manufacturer Derived Revenue guaranteed amounts specified in this Exhibit 1 are conditioned upon Plan Sponsor's adherence to certain conditions under this Agreement. (a) If the Manufacturer Derived Revenue advanced to Plan Sponsor for the Contract Year is, overall, lower than the overall Manufacturer Derived Revenue earned by Plan Sponsor for the Contract Year, Envision shall pay the difference to Plan Sponsor, after application of any additional offset allowed under this Agreement. (b) If the Manufacturer Derived Revenue earned by Plan Sponsor for the Contract Year is, overall, lower than the annual average Manufacturer Derived Revenue guaranteed amounts specified above, in the aggregate, Envision shall pay the difference to Plan Sponsor, after application of any additional offset allowed under this Agreement. Notwithstanding anything herein to the contrary, Envision shall not be liable to Plan Sponsor for any shortfall in guaranteed Manufacturer Derived Revenue if: (i) Plan Sponsor makes a change to the Benefit Plan at any time (regardless of whether or not such change is required by law); (ii) the configuration of System edits is modified by Plan Sponsor; (iii) Plan Sponsor does not adhere to the Formulary; (iv) the utilization data provided by Plan Sponsor (or Plan Sponsor's agent) upon which the calculation of guarantees were based is inaccurate, incomplete; (v) there is a substantial change in drug utilization patterns of Covered Individuals; (vi) there is a loss of rebates due to pharmaceutical manufacturer drug patent expirations, manufacturer bankruptcy, or removal of a drug from the market; (vii) there are changes in pharmaceutical manufacturer rebate contracting terms or policies; (viii) Plan Sponsor's Benefit Plan does not meet the conditions for rebates of pharmaceutical manufacturer contracts including market share rebates; (ix) if Plan Sponsor has been excluded by a manufacturer; (x)there is any governmental regulation, ruling, or guidance that impacts Envision's ability to maintain current Manufacturer Derived Revenue yields; or (xi) Plan Sponsor terminates before completion of the applicable, Contract Year. Plan Sponsor agrees that Envision's liability to Plan Sponsor for shortfalls in financial guarantees, in the aggregate, for any Contract Year shall be limited to amounts paid by Plan Sponsor to Envision for Administrative Fees during the applicable Contract Year, and Plan Sponsor has no right of offset to withhold any payment due Envision under this Agreement for any amounts Plan Sponsor believes are owed by Envision for financial guarantees. Administrative Fee (Payable to Envision; not including fees payable to Plan Sponsor's TPAs, consultants, or brokers, if any) For Contract Year 2017: $4.05 Per Eligible Employee, Per Month(PEPM) For Contract Year 2018: $4.05 PEPM For Contract Year 2019: $4.05 PEPM , Fees for Additional Services and Miscellaneous Expenses 1. Manually create or update the Eligibility File $1.00 per Covered Individual data entry 2. Replacement by Envision of lost or stolen ID $1.00 per card plus cost of postage Cards (individual), $2.00 per card (family)plus $0.15 per ID /City of Renton Amendment No.2 091216 0 Envision Pharmaceutical Services,LLC Page 5 of 6 DocuSign Envelope ID:595F61C2-3E3B-4754-8E02-F2C9E16AD669 Card packet and cost of postage 3. Standard Online Reporting User Access Standard Online Reporting includes access for 3 client users and 1 consultant user. A licensing fee is charged for each user account not accessed over a 60-day period. $1,200.00 per additional unique user 4. Ad Hoc Computer or Report Programming(for a $2,500.00 per report for development of one-time,non-recurring report) non-standard report 5. Clinical Prior Authorization with outreach to prescriber $35.00 per request 6. Redeterminations $125 per request 7. Claim Adjustment Checks (charged to Plan Sponsor for reimbursements made to Covered Individuals for Claim adjustments requested by Plan Sponsor.) $8.50 per check 8. Explanation of Benefits(EOB)production and distribution $1.00 per EOB plus postage 9. Manual Claims Processing(including DMRs) $1.50 per Claim processed *Financial guarantees and fees are contingent upon Plan Sponsor maintaining at least 1,448 Members each month for each Contract Year. If the annual average of enrollment falls 20%or more from 1,448, Plan Sponsor acknowledges and agrees that Envision may modify the financial guarantees or fees. /City of Renton Amendment No.2 091216 ©Envision Pharmaceutical Services,LLC Page 6 of 6