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HomeMy WebLinkAboutContract 46250-A1 v. ur' , AMENDMENT NO. 1 TO PHARMACY BENEFIT MANAGEMENT SERVICES AGREEMENT YNXN'IW00, ��� ! 7 -is Amendment No. 1 (this "Amendment"), is entered into by and between Envision Pharmaceutical Services, LLC ("Envision"), and the City of Fort Worth ("Plan Sponsor"). BACKGROUND Envision and Plan Sponsor are parties to a Pharmacy Benefit Management Services Agreement, filed as City Secretary Contract No. 46250, dated January 1St, 2015 (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. Exhibit I shall be deleted in its entirety and replaced with Exhibit 1 attached hereto and incorporated by this reference. 2. Exhibit 2 shall be deleted in its entirety and replaced with Exhibit 2 attached hereto and incorporated by this reference. 3. This Amendment shall be effective January lst, 2016 ("Effective Date"). 4. 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: By: _ By . a..,N . Matthew A. Gibbs, Pharm D. usa Alanis Chief Commercial Officer tant City Manager RT Afte b ' %�, ,. APPROVAD AS TO FORM AND LEGALITY- e 10,§0_ J✓ pry J See 0 =V1, F FICI i RECORD FT. VVORTily 1"X —- -1Fr wMIfAffiffl NO:-1- 1815 (0 Envision Pharmaceutical Services,LLC Page 1 of 7 EXHIBIT 1 FEES, DRUG PRICING, AND FINANCIAL GUARANTEES Administrative Fee (Payable to Envision; not including fees payable to Plan Sponsor's TPAs, consultants, or brokers,if any) For Contract Year 2016, 2017 & 2018: $4.00 Per Employee, Per Month(PEPM) Fees for Additional Services'and Miscellaneous Expenses 1. Replacement by Envision of lost or stolen ID $1.00 per card plus $0.15 per packet and Cards cost of postage 2. Manual Claims Processing(including DMRs) $1.50 per Claim processed 3. Claim Adjustment Checks (charged to Plan Sponsor for reimbursements made to Covered Individuals for Claim adjustments requested by Plan Sponsor.) $8.50 per check 4. Manually create or update the Eligibility File $1.00 per Covered Individual data entry 5. Ad Hoc Computer or Report Programming $150.00 per hour 6. Clinical Prior Authorizations (Initial Coverage Determinations) $8.00 per authorization 7. Drug Therapy Care Gap Management $0.55 per Member per month (PMPM) 8. Medication Adherence and Persistency (up to three disease states) J $0.55 PMPM Drug Pricing and Dispensing Fees() Supply/Source BRAND GENERIC Drug Price(B) Dispensing Drug Price iB> Dispensing For Contract Year (Annual Average Fee to> (Annual Average Fee(c) 2016 Effective Rate (Annual Effective Rate (Annual Guarantee) Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a AWP minus 15.45% $1.20 AWP minus $1.20 Retail Pharmacy 77.50% 84 Days' Supply (or greater) at a Retail AWP minus 20.20% N/A AWP minus N/A Pharmacy (non-Mail 77.50% Order) Mail Order Pharmacy AWP minus 21.06% N/A AWP minus 80% N/A Specialty Pharmacy (Pass-Through of Contract Rate with Dispensing Pharmacy) /Ft.Worth Amend.No. 1 061815 0 Envision Pharmaceutical Services,LLC Page 2 of 7 Supply/Source BRAND GENERIC Drug Price Dispensing Drug Price iB> Dispensing For Contract Year (Annual Average Fee(c) (Annual Average Fee(Q 2017 Effective Rate (Annual Effective Rate (Annual Guarantee) Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a AWP minus 15.55% $1.20 AWP minus 78% $1.20 Retail Pharmacy 84 Days' Supply (or greater) at a Retail AWP minus 20.30% N/A AWP minus 78% N/A Pharmacy (non-Mail Order) Mail Order Pharmacy AWP minus 21.06% N/A AWP minus N/A 80.50% Specialty Pharmacy (Pass-Through of Contract Rate with Dispensing Pharmacy) Supply/Source BRAND GENERIC Drug Price(B) Dispensing Drug Price(B) Dispensing For Contract Year (Annual Average Fee(c) (Annual Average Fee(c) 2018 Effective Rate (Annual Effective Rate (Annual Guarantee) ! Average Guarantee) Average Guarantee) Guarantee) 30 Days' Supply at a AWP minus 1565/0 o $1.20 AWP minus $1.20 Retail Pharmacy . 78,50% 84 Days' Supply (or greater) at a Retail AWP minus 20.40% N/A AWP minus N/A Pharmacy (non-Mail 78.50% Order) Mail Order Pharmacy AWP minus 21.06% N/A AWP minus 81% N/A Specialty Pharmacy (Pass-Through of Contract Rate with Dispensing Pharmacy) (A) For purposes of this Agreement the "Average Wholesale Price" or"AWP" means the average wholesale price of a Covered Drug indicated on the most current pricing file provided to Envision by Medi-Span® (or other applicable industry standard reference on which pricing hereunder is based)for the actual drug dispensed using the 11 digit National Drug Code (NDC) number provided by the dispensing pharmacy. Envision uses a single source for determining AWP and updates the AWP source file at least once weekly. IB? For purposes of this Agreement, the "Annual Average Effective Rate" means, for the category of drugs being reviewed,the result calculated by the following formula: 1. (IC/AWP)-1,where IC (the"Ingredient Cost")is the sum of all amounts paid by Plan Sponsor for the ingredient costs of the Covered Drugs paid to Participating Pharmacies in the designated Network during the Contract Year, before deducting applicable Manufacturer Derived Revenue; and /Ft.Worth Amend.No. 1 061815 Cc Envision Pharmaceutical Services,LLC Page 3 of 7 2. AWP is the sum of the Average Wholesale Price amounts associated with the same Covered Drugs during the Contract Year. 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. Annual Average Effective Rate is calculated using actual price paid by Envision to Participating Pharmacies in the designated Network,plus any Cost Share,(the Ingredient Cost)for all Claims for the applicable category (including Claims paid at the U&C Price)during a Contract Year,excluding(i)Compound Drugs;(ii)Limited Distribution Drugs; (iii) drugs dispensed at a Specialty Pharmacy; (iv) Claims from non-Participating Pharmacies, LTC pharmacies, or government owned or operated pharmacies (e.g. Veterans Administration); (v)Claims paid at government required amounts(e.g. Medicaid); (vi)340B Claims; (vii)vaccines;(viii)non- Prescription Drugs; and (ix) Claims from any Plan Sponsor owned or affiliated pharmacy which is not a Participating Pharmacy. •(c) 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)Limited Distribution Drugs;(iii)drugs dispensed at a Specialty Pharmacy; (iv) Claims from non-Participating Pharmacies, LTC pharmacies, or government owned or operated pharmacies(e.g.Veterans Administration); (v)Claims paid at government required amounts(e.g. Medicaid); (vi)340B Claims;(vii)vaccines;(viii)non-Prescription Drugs;and(ix)Claims from any Plan Sponsor owned or affiliated pharmacy which is not a Participating Pharmacy. Annum 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 I 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. Within four months after the end of each Contract Year, Envision shall provide Plan Sponsor, upon request, with a report showing the actual Annual Average Effective Rates and Annual Average Dispensing Fees paid by Plan Sponsor for the Contract Year. 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,than the combined Annual Average Effective Rates and Annual Average Dispensing Fees stated in Exhibit 1,Envision shall credit Plan Sponsor with the difference. 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 Envision Formulary; or(iv)the utilization data provided by Plan Sponsor(or Plan Sponsor's agent)upon which the calculation of guarantees were based is inaccurate, incomplete, or there is a substantial change in drug utilization patterns of Covered Individuals. 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(EMFI(G) For Contract Year 2016, 2017 & 2018: • For Brand Drugs at a Retail Pharmacy - $23.50 per paid Brand Drug Claim /Ft.Worth Amend.No. 1 061815 c,Envision Pharmaceutical Services,LLC Page 4 Of 7 • For 90 day supply of Brand Drugs at the Mail Order Pharmacy- $57.10 per paid Brand Paid Claim (E)Manufacturer Derived Revenue guarantees are stated as annual average amounts per Contract Year. 1F> 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 and other Claims not eligible for Manufacturer Derived Revenue,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. 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. Nine months after the end of each Contract Year, Envision shall provide Plan Sponsor with a report reconciling Manufacturer Derived Revenue amounts advanced to Plan Sponsor and Manufacturer Derived Revenue amounts earned by Plan Sponsor for eligible Claims(including market share based amounts) during the Contract Year. (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. (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, Envision shall pay the difference to Plan Sponsor. 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 snakes 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,or there is a substantial change in drug utilization patterns of Covered Individuals;(v) there is a loss of rebates due to pharmaceutical manufacturer drug patent expirations, manufacturer bankruptcy, or removal of a drug from the market; (vi) there are changes in pharmaceutical manufacturer rebate contracting terms or policies;(vii)Plan Sponsor's Benefit Plan does not meet the conditions for rebates of pharmaceutical manufacturer contracts including market share rebates; (viii) if Plan Sponsor has been excluded by a manufacturer; or (ix) there is any governmental regulation, ruling, or guidance that impacts Envision's ability to maintain current Manufacturer Derived Revenue yields. 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. /Ft.worth Amend.No. 1 061815 ©Envision Pharmaceutical Services;LLC Page 5 Of 7 EXHIBIT 2 PERFORMANCE MEASURES Unless otherwise stated, targets set forth below will be measured on a Contract Year basis. The total amount of penalties payable by Envision in any Contract Year shall not exceed ten percent (10%) of Envision's Administrative Fee paid by Plan Sponsor during applicable Contract Year. Unless otherwise stated,payment of penalties will be credited towards future Administrative Fees. Failure to meet Performance Measures shall not be deemed to be a breach of this Agreement. z Pass Through Stari ciards Manufacturer Derived Revenue 100%Pass- 100%of MDR earned from pharmaceutical (MDR) through manufacturers is passed through to Plan $40,000 Sponsor, in accordance with the Agreement. Network Discounts 100%Pass- 100%of network discounts and dispensing fees Network Dispensing Fees through are passed through to Plan Sponsor upon the $40,000 effective date of any negotiated change. �ystoms.Standards Calculated as the amount of time the Claims System Availability 99.5% Adjudication System is available to process $15,000 Claims. Calculated as the time commencing immediately System Response time <4 seconds after receipt of the last character of a transaction $15,000 submitted by a pharmacy until the first character of the response is sent to the pharmacy. R tatl acid Mail,Clax nsTrocess ng Accuracy% Based on PBM's internal quality review. Percent of all claims paid with >99.98%Retail Calculated as all claims audited and found to be $15,000 no errors >99.98%Mail without error of any form,divided by all claims audited. Pt Cizstonier,S6rvice=:Calculated per Contract Year The amount of time that elapses between when a call is received into the customer service queue Percent of calls that will be 93%answered in and the time the phone is answered by a answered within 30 seconds an average of 30 Customer Service Representative(CSR). $15,000 seconds or less Measurement and target determination will be based on an annual average. Percentage of calls that are not answered by a CSR(caller hangs up before call is answered). Calculated as the number of calls that are not Percent of calls abandoned <5% answered divided by the number of calls $15,000 received. Measurement and target determination will be based on an annual average. {Ft.Worth Amend.No. 1061815 0 Envision Pharmaceutical Services,LLC Page 6 of 7 a s � 'BM Cus#c�rrier'; ervice cont -`Galctzlated per';Coniract Year i Percentage of all calls made to Envision that Percent of calls with resolution were resolved by initial CSR. Calculated as the at end of first call(i.e. no further total calls to Envision minus total number of inquiry by caller required to >90% unresolved calls divided by the total number of $15,000 obtain requested information or calls received. action) Measurement and target determination tivill be based on an annual average. Percent of written inquiries Response time for all written inquiries will be responded to by paper within 10 o based on the number of business days business days or responded to 99% subtracting the date received at Envision from $15,000 electronically within 2 business the date the response was sent. days Based on network pharmacy access within, Pharmacy Network Access >95% J0 miles for Plan Sponsor's Covered $15,000 Individuals. 7777-777-7=7 7 A Account Management Two(2)business Initial client inquiries will be acknowledged and $15,000 Responsiveness days responded to within two business days. Administration Eligibility information submitted to Envision Enrollment Processing Two(2)business will become effective within 2 business days $15,000 days following the date of receipt. Assumes complete and accurate information is sent to Envision. Five(5)business Measured as the time from receipt of complete Ongoing ID card production days and accurate eligibility information to the time $15,000 vendor deposits ID Cards into the mail. /Ft.Worth Amend.No. 1 061815 ©Envision Pharmaceutical Services,LLC Page 7 of 7