Feb. 18: ALC Insurance

Senator Jim Petty Members, if you’ll find your seats, we’re going to go ahead and get started. With that, we’re going to call the State Insurance Program’s Oversight Subcommittee to order. Chair sees a quorum. Our first item up for agenda is a consideration for review and approval of actions by the State Board of Finance, which is exhibits B1 through B3. 

And I believe Mr. Grant Wallace, the director of EBD, is going to present all of those for us. Mr. Wallace, you know the routine, but if you would, for the audience online, maybe introduce yourself for the record, and then you may proceed. 

Grant Wallace Good morning. Grant Wallace, Director of the Employee Benefits Division and Office of Property Risk. The first item before you is item B1. It is the review of an EBD contract with Boston Consulting Group. This is a contract for $280,000. 

This is utilizing the new program that the Office of Procurement has done where there are five vendors that can assist us in procurements and developments of RFPs. Boston Consulting Group was the one that we selected to assist us with the development of the third-party administration RFP that we will be issuing early, hopefully in the next couple of months. With that, I’d be glad to answer any questions. 

Senator Jim Petty Thank you Mr. Wallace. Are there any questions from the members? I do not see any. So with that, I need a motion to review the contract. I have a second. All right. Have a motion and a second. All those in favor, let it be known by aye. Any opposed? Motion carries. Next item is item number two. 

Pharmacy formulary recommendations

Grant Wallace Okay, item number two is the December 2025 pharmacy formulary recommendations. The first three items, we are just removing a PA for the injectable CGRPs. These are migraine medications, and we have found that after review almost 100% of these members are being approved. 

So we’re just going to make it easier, streamline that process to get those drugs. The next one I would like to highlight is item four. The capsule is currently on formulary, but is soon to be discontinued. So we’re replacing that with the tablet. Items 5, 6, 9, 10, and 11 are all updating, due to FDA updates in guidelines and dosing recommendations. 

The remaining items, we are going to leave at not covered, just because there is either an already covered alternative that is less costly for the plan or the efficacy has not been proven up to standards yet to add it onto the formulary. Be glad to answer any questions for the December formulary recommendations. 

Senator Jim Petty Members, are there any questions? Seeing none, I would need a motion to approve the December 25 recommendations. I have a motion and a second. All those in favor let it be known by aye. Any opposed? Motion carries. 

Grant Wallace Next item up is the January 2026 pharmacy formulary recommendations. All of these, we are leaving– items one and two are new to market that we were leaving not covered until we get more clinical data. Item 9, we’re removing just because there are over the counter alternatives that are less costly to the plans available. Be glad to answer any questions. 

Senator Jim Petty All right, members, looks like we have one. Representative Pilkington, you are recognized. 

TrumpRX

Representative Aaron Pilkington Thank you, Mr. Chair. This isn’t necessarily on the formulary. But I am curious, and I just wanted to, before this meeting got over, obviously there’s been new pharmaceutical– the TrumpRX plans have come about. Obviously, there’s a whole list of how those drugs are now. 

Do we have any sort of impacts for how that will affect our list of drugs? And then, of course, what the overall total impact to our plan will be if we’re pushing members to use that program or anything like that. Could you give us a little bit of a summary? 

I know it’s not on the agenda. But since we’re talking about these and what we’re adding to our formulary or not, I just thought it might be good for my knowledge to know, how is that affecting us? 

Grant Wallace Right. And thank you for that question. There’s a lot of unknowns still with the rolling out of the TrumpRX plan and those kinds of things. But we are in the process of working with Navitus and figuring out with like the Mark Cuban Cost Plus and all of these programs that are now coming out, how do we take advantage of that? How can we negotiate better pricing with the manufacturers as well? A lot of that is still being studied. I don’t have all the answers at this point, but the questions are being asked and we are looking into that. 

Senator Jim Petty Anybody else, other than the weather forecast? All right, seeing none, then I need a motion to approve the 2026 recommendations. I have a second. All those in favor, let it be known by aye. Any opposed? Motion carries. 

Grant Wallace Moving to the February 2026 pharmacy formula recommendations. Item 1, 2, and 3, and this will be probably the biggest talking points. Skyrizi and Rinvoq, we are going to remove those from our formulary as we are preferring lower cost alternatives, which do include bio similars, in the market. And the pricing on this is just now we’re getting pricing and availability to where it makes sense to remove those from our formulary at this point. 

Looking at the next two items, we are just re-tiering those as we look at the other alternatives that are available. Generics are being added on for item number 4. And item number 5, this is an interesting one. We are adding this one to the formulary. This is an anti-seizure medicine. This was developed by the Department of Defense to use in chemical warfare and it has proven very effective. 

We’re not at the point that we can really get it in commercial packaging. It is still pretty bulk packaging. But we are working on adding this in advance of that. The remaining items on that page, 6, 7, 8 and 9 will be not covered as we don’t have any superior efficacy data around those. The next, 11 through 16, we are re-tiering those just to promote the lower cost generic for high blood pressure medications. 

And 17 and 18, we’re looking at restructuring those because these are our lower net spend than the generics for our plan for the acne medicines. And outside of that, everything else would remain not covered because we already cover a lower cost alternative. Be glad to answer any questions. 

PMB lawsuits and Navitus

Senator Jim Petty Members, are there any questions? I did have one, sort of unrelated to any specific drug, but in general, because these are all recommendations by EBRs and our PBM Navitus. 

With all the news around our PPM law and the lawsuits and across the country, and even our federal folks are considering action and against PBMs, most recently I saw an article– and I believe it was West Virginia or somewhere where Navitus had– they had passed a similar bill and Navitus was found and fined, I believe, of $700,000 or $800,000 regarding violation of that law. 

Are we doing anything or do we have any idea whether or not our PBM Navitus is violating our law? I know there’s litigation, but can you comment to that? Because it is a lot of– there’s a lot in the media about that. 

Grant Wallace Once that article came out, I did have them go back and review. And Rule 118 is really kind of similar to what that situation was. Had them review, they have come back saying that they are in compliance. But we are doing additional research into that to verify that. 

Senator Jim Petty All right. And when you say additional research, are you auditing claims? 

Grant Wallace Right. Yes, sir. 

Senator Jim Petty All right. And then in terms of their input on these and the changes to these, these are obviously published drugs, but is there any feedback or any thoughts on these decisions maybe disproportionately benefiting them in any way that would affect these– most of these don’t affect anybody. 

But some of those, like you mentioned Skyrizi and Rinvoq, are higher numbers. Normally we don’t have high numbers on impacted members. But any thoughts on that process when you’re having the conversations with them about what do we do with this or cover or not cover? 

Grant Wallace So, really the approach that I take, and this may sound a bit cold, but I think it’s the reality of the position that I’m in, is that I am looking at it from a financial standpoint. And as the fiduciary for the plan, what is the best financial decision, along with the evidence, the scientific evidence that backs the utilization of that drug, to make the best decision for the plan. 

So, really those two things are what are driving the decision. Obviously, we’re looking at rebates and how do rebates play into it. But ultimately, it is really what is the lowest net cost to the plan is what is going to meet one of the top criteria of driving the formulary design. 

Senator Jim Petty And I certainly understand that and we want to be conscious of our fiduciary responsibility when it comes to financial. But we want to make sure it’s good long-term financially, not just short-term. We’re not in the publicly traded stock market, so we don’t really particularly care what current earnings look like so to speak as much as we do the long-term sustainability. So thank you for that. Looks like Senator Boyd, you are recognized. 

Senator Justin Boyd Thank you, Mr. Chair. Now that you brought this up and brought it to my attention, I appreciate that. So I just remind Mr. Wallace that whenever we had committee hearings during the legislative session that the Navitus CEO was there and she promised to get back to me on one of my questions, which was, are we paying our affiliate pharmacies more than we’re paying our independent pharmacies within the plan? 

I haven’t ever gotten an answer back and it just turns out that that West Virginia issue, one of the things I found is that the affiliate pharmacies were being paid more than the independent pharmacies. And so I just think that we need to continue this conversation and the video testimony is there. 

And maybe you can go back and figure out exactly what I asked her. I just know that I’ve been waiting for months for an answer and haven’t gotten it. Thank you. 

Senator Jim Petty Thank you, Senator Boyd. And that does bring up another question because overall it could be good for the EBD program, but if it’s disproportionately affecting our community pharmacies versus affiliated, the net is good but that still doesn’t make it right. And I’m not saying that that’s happening here. 

So any other questions from the committee? All right. If not, then I would need a motion to approve the February 26 recommendations. Have a motion. Do I have a second? Have a motion and second. All those in favor, let it be known by aye. Any opposed? Motion carries. Item number 3. Mr. Wallace. 

Medical drug recommendations

Grant Wallace All right. This is the February 2026 medical drug recommendations. Again, the disclaimer that I give with these, these are drugs that are administered in a clinical setting. You’ll look at item 1, 2, 3, 4 and 6 are bio similars that are coming on to the market that we are just moving towards on the medical side. 

We are also doing the same with Skyrizi and Rinvoq on the medical side because it is one that can be administered in a medical setting as well as the pharmacy. So we’re making sure that those line up. And then item 5, this is a subcutaneous version of Keytruda, which is a much quicker injection time than the IV. 

So we want to make sure that that’s added on for patient access and alternative delivery mechanisms. And then you’ll see the last item, 11, we are excluding because we still cover lower cost alternatives. Be glad to answer any questions. 

Senator Jim Petty Thank you, Mr. Wallace. Any questions of the members? If not, I need a motion to approve or otherwise. Have a motion to approve the recommendations. I have a motion. Do I have a second? I have motion and a second. All those in favor, let it be known by aye. Any opposed? Motion carries. Seeing no other business, we are adjourned.