1. July 8, 2008 ORANGE COUNTY 2009 MEDICAL & DENTAL PLAN CONTRACTS

2. PRESENTATION OUTLINE BACKGROUND MEDICAL \ PHARMACY RFP DENTAL RFP ACTION REQUESTED

3. BACKGROUND

4. BACKGROUND - MEDICAL County moved to self-funded medical in 2007, and model is working well - $7.9 million savings in plan year 2007 Medical Plan Oversight Committee oversees plan Benefits Consultant RobinsonBush works with oversight committee and HR on key benefits initiatives

5. BACKGROUND - MEDICAL County is in 5 th year of contract with UnitedHealthcare Formal procurement required every 5 years Oversight Committee worked with Consultant and Purchasing & Contracts on medical RFP development

6. BACKGROUND - DENTAL Dental Plan is fully insured and employee funded Employees are happy with current Dental plan Dental insurance provided by the Standard

7. BACKGROUND - DENTAL County is in 5 th year of contract with the Standard Formal procurement required for plan year 2009

8. MEDICAL / PHARMACY RFP

9. Requested Administrative Services Only (ASO) proposals for self-funded medical Asked for both integrated medical / pharmacy and pharmacy carve out options Three providers proposed integrated programs – Aetna, Cigna and UnitedHealthcare (UHC)

10. MEDICAL / PHARMACY RFP Four Additional Pharmacy Benefits Managers (PBM) proposed pharmacy carve outs – Caremark, Express Scripts, Medco and Walgreens Benefits Consultant evaluated medical & pharmacy proposals and reported findings & recommendations

11. Procurement Committee found: –UHC’s claims pricing and admin fees lower than other two providers -UHC has good reputation with County and other references checked -UHC will provide employee wellness support to include $150,000 annual to fund DM / wellness programs MEDICAL RFP

12. PHARMACY RFP Procurement Committee found: Express Scripts - Estimated annual costs lower than all other providers -Largest pharmacy network -Offers additional services – quarterly reports and enrollment support -Offers employee education & support

13. DENTAL RFP

14. Benefits Consultant evaluated dental proposals and reported findings & recommendations Seven dental insurers provided proposals -Aetna, Cigna, Delta Dental, UHC, Humana, Solstice and Standard

15. DENTAL RFP Procurement committee found: Standard -Proposed rates competitive with other providers -Has largest # of top 100 providers -Offered 2 year rate guarantee & potential for year 3 -Noted no disruptions to current plan design

16. ACTION REQUESTED Approve Procurement Committee’s recommendation to select UnitedHealthcare as the County’s self- funded medical ASO Provider Approve Procurement Committee’s recommendation to carve out Pharmacy and select Express Scripts as the County’s self-funded Pharmacy Benefit Manager Approve Procurement Committee’s recommendation to select Standard as the County’s Dental Insurance Provider

17. July 8, 2008 ORANGE COUNTY 2009 MEDICAL & DENTAL PLAN CONTRACTS