4th Annual Pharmacy Benefits Academy Pharmacy Benefits at a Crossroads August 19-20, 2010 Hyatt Regency O’Hare, Rosemon

1. 4th AnnualPharmacy Benefits AcademyPharmacy Benefits at a Crossroads August 19-20, 2010Hyatt Regency O’Hare, Rosemont, IL

2. Midwest Business Group on HealthPowerful Connections, Vital Solutions • MBGH is a Chicago-based, non-profit coalition of employers and other health care stakeholders working together to improve the quality and cost-effectiveness of health care for purchasers and the productivity and health status of their workforces • Founded in 1980, membership includes over 100 large, self-funded, public and private employers such as Abbott Laboratories, Advocate Health Care, The Boeing Company, Caterpillar, Inc., City of Chicago, Ford Motor Co., Kraft Foods, State of Illinois, University of Chicago and Walgreens • Employers are represented by those responsible for designing and managing health benefits • Member organizations provide health benefits for over 3 million lives and spend over $2.5 billion on health care

3. MBGH Learning NetworkEducation & networking for health benefits professionals • Health Benefits Roundtables • Half-day Learning Network Programs • Health System User Groups • Blues User Group • Health Benefits Benchmarking Surveys • Monthly Medicare Employer Forum Calls

4. MBGH Learning NetworkUpcoming educational programs • August 29-31, 2010 HR & Employee Benefits Executive Forum • September 13-14, 2010 College for Value-Based Purchasing of Health Benefits • September 29, 2010 Employer Roundtable – Prevention & Disease Management • October 21, 2010 Employer Roundtable – On-Site Clinics

5. Health Benefits & Quality InitiativesResearch to improve benefit design and quality in our community Value-Based Benefits Research Series

6. Employer Challenges in Pharmacy Benefits • Increasing high cost of specialty pharmacy drugs • More drugs for more conditions being available • Poor employee choices • Employees not making necessary lifestyle changes • Employees taking expensive brand drugs when generics are available • Poor compliance levels • Employees not filling or taking the drugs they need • PBMs and health plans not focusing on improving compliance • Lack of cooperation between vendors • PBMs and health plans making it difficult for employers to integrate drug with medical data • Lack of outcomes data to make drug coverage decisions 2010 Employer and Coalition Trends –The Benfield Group

7. Leading-Edge Pharmacy Benefit Strategies • Putting quantity limits on initial prescriptions for specialty drugs to reduce costs when drugs are not taken or the prescription changed • Using smaller pharmacy networks • Using co-insurance instead of co-pays • Offering on-site pharmacy services • Offering coupons for free generics for initial prescription • Direct contracting with retail pharmacy chains • Eliminating coverage for certain conditions where OTC options are most effective approach • Reference-based pricing • Using value-based formularies and benefit designs • Requiring performance guarantees detailing compliance levels with certain drug categories

8. If high compliance is the major goal to improve health and lower costs…. PBMs and health plans need to be asked… • How do you make sure the patient is receiving the best medication to treat their condition? • How do you make sure you are receiving the best price? • How do you identify “high potential” patients? • How do you design an affordable compliance enhancing pharmacy benefit? • What educational components do you utilize to improve compliance? • What evidence exists to demonstrate that the programs are increasing compliance? • What research efforts are you supporting to increase compliance?

9. Why conduct a Pharmacy Benefits Academy? • Most employers, PBMs and health plans recognize the value of offering the early and appropriate use of drugs • Purchasers have seen the cost of drugs become a greater portion of their benefits budgets • Most employers rely on a range of providers, plans, PBMs, DM firms and others to assist in designing and managing the benefit, often without appropriate due diligence • “Value-” and “evidence-” based benefit designs are being promoted as ways to change behavior and motivate better decision-making, but many employers don’t know what or how to do it

10. MBGH & Pharmacy Outcome Specialists • MBGH recognized the need for an intensive “course” to provide purchasers with the skills and knowledge to design, select, contract, manage and monitor pharmacy benefits • MBGH member, Pharmacy Outcomes Specialists, recognized the need to assist its employer and health plan clients, and sought out MBGH as a partner • We joined forces to create the Pharmacy Benefits Academy to assist those responsible for managing pharmacy benefits

11. Pharmacy Outcome Specialists (POS) Specialists in… • PBM audits and contract renewals • Chain pharmacy reimbursement audits • Fraud, waste and abuse programs for Medicare Part D Plan Sponsors • Pharmacy educational conferences • Clinical pharmacy consulting

12. Before we begin, please silence your… • Blackberries • Cell phones • Droids • Pagers • IPods – IPhones – ITunes - IPads • Other noise making devices or colleagues

13. Key Logistics • Participation is more than attending ….. it’s being interactive with the speakers and your fellow attendees • Your feedback on the program is critical to our future success – please complete the evaluation form • Visit the PBA Sponsors & Exhibitors • Today’s meeting rooms and facilities

14. This program is eligible for HRCI Certification The PBA has been approved for 12 general recertification credit hours toward PHR, SPHR and GPHR recertification through the HR Certification Institute. The use of this seal is not an endorsement by the HR Certification Institute of the quality of the program. It means that this program has met the HR Certification Institute's criteria to be pre-approved for recertification credit.

15. Thanks to our 2010 PBA Sponsors • Session Sponsors: • HealthDataInsights • Walgreens • Event Sponsor: • Next Generation (Perform Rx) • Exhibitors: • Aetna Pharmacy Management • Argus • CitizenRx • First Script • Genentech • Restat Academy Gold Sponsors: Envision Rx Options Pfizer, Inc. Prescription Solutions SXC Academy Sponsors: Advocate Physician Partners Merck & Company sanofi-aventis

16. 4th AnnualPharmacy Benefits AcademyPharmacy Benefits at a Crossroads August 19-20, 2010Hyatt Regency O’Hare, Rosemont, IL