This pertains to any employee who is on the District health insurance plan.

To address employee concerns about the miscommunication and misunderstanding of how prescription drug expenses are applied to the Tier 2 out-of-pocket maximum in 2026, the District will implement a reimbursement arrangement for members whose prescription costs exceed the Tier 1 out-of-pocket maximum in 2026. After the 2026 plan year closes on December 31, the District will work with UMR and CVS to review members’ prescription drug expenses and determine any applicable reimbursement for actual prescription costs that exceeded the Tier 1 out-of-pocket maximum. Because these costs qualify as out-of-pocket medical costs under IRC Section 105, reimbursements will be provided as a non-taxable benefit. 

Background & Historical Context

To provide complete transparency and clarity on how prescription drug (Rx) claims tracked toward out-of-pocket (OOP) maximums under our health insurance plan, here are the details of how this system tracking developed:

• 2024: Tier 1 and Tier 2 shared identical out-of-pocket maximum thresholds of $3,000/$6,000. While UMR’s Summary Plan Description specified that prescription expenses tracked toward Tier 2, this distinction had no practical impact on employee claims or benefit limits at the time because the out-of-pocket dollar maximums for both tiers were both set at $6,000.

• 2025: Plan design changes were made to create steerage to Tier 1 and the Nexus ACO network as a cost containment strategy. The Tier 1 out-of-pocket maximum remained at $3,000/$6,000, while the Tier 2 out-of-pocket maximum increased to $4,000/$8,000. Erroneously, CVS Caremark and UMR were notified by a former insurance broker that no changes were being made to pharmacy benefits. CVS Caremark left the Rx out-of-pocket maximum at $6,000. The District was not aware of this until 2026. As a result, no information was shared during open enrollment meetings.

• 2026: Plan design changes were made once again. Tier 1 out-of-pocket maximums remained at $3,000/$6,000, and Tier 2 out-of-pocket maximums increased to $10,600 (individual maximum)/$12,000. Additionally, on 1/1/26, the District implemented a speciality Rx program, Prudent Rx, that put into place a “true accumulator.” A true accumulator provides out-of-pocket credit to members for only the copay or cost share they contribute toward the cost of a prescription. Prior to the implementation Prudent Rx, members were given credit for the full value of manufacturer drug coupons even if there had been no required copay. An employee in the Prudent Rx program questioned why they were being charged for Rx beyond the $6,000 Tier 1 out-of-pocket maximum, resulting in an inquiry with UMR and CVS Caremark and the discovery of the discrepancy.

• 2027: To help minimize the financial impact on members, effective 1/1/27, prescriptions will once again track toward the out-of-pocket maximums established in Tier 1. They will remain at $3,000/$6,000. 

If you have questions regarding your specific claims or out-of-pocket maximum tracking, please reach out directly to Quantum Health at 1-866-499-5106. I sincerely apologize for any confusion or burden this has caused you.

Pam Casey, Assistant Superintendent for Human Resources