L O C K T O N C O M P A N I E S

UNIVERSITY OF ALASKA F Y 1 8 U T I L I Z A T I O N R E V I E W7 / 1 / 2 0 1 7 T O 3 / 3 1 / 2 0 1 8

L O C K T O N C O M P A N I E S

Premera - Medical

2

Medical Utilization

Norm is based on Premera’s Alaska large group book of business

Utilization CategoryFY17 (Q3) FY18 (Q3)

% Change

over FY17 (Q3)

Norm

Inpatient

Paid Claims Per Member Per Month $86 $85 -1% $88

Admissions Per 1000 Members 37 38 2% 48

Days Per 1000 Members 200 199 -1% 227

Average Length of Stay 5.4 5.3 -3% 4.8

Paid Claims Per Admission $27,845 $27,015 -3% $22,147

Outpatient

Paid Claims Per Member Per Month $104 $110 6% $104

Visits Per 1000 Members 1,035 1,092 5% 1,008

Paid Claims Per Visit $1,205 $1,212 1% $1,244

Services Per 1000 Members 4,023 4,143 3% 3,843

Services Per Visit 3.9 3.8 -2% 3.8

Paid Claims Per Service $310 $319 3% $326

ER Utilization: Paid Claims PMPM $20 $23 16% $26

ER Utilization: Visits Per 1000 Members 131 140 7% 191

ER Utilization: Paid Claims Per Visit $1,795 $1,956 9% $1,665

Professional Provider

Paid Claims Per Member Per Month $210 $219 4% $203

Services Per 1000 Members 16,987 17,220 1% 16,178

Paid Claims Per Service $148 $152 3% $151

3

❖ Emergency Room

− The number of ER visits increased compared to FY17 Q3 and the cost per visit decreased minimally but continues to be above the Premera norm. Lower number of visits coupled with higher cost per visit can indicate appropriate ER utilization.

❖ Outpatient Services

❖ The number of services and the cost per visit/service increased moderately.

❖ Large Claims –

− The number of large claimants decreased; however, the severity of the claimants and total dollars paid increased in Q3 FY18 compared to Q3 FY17.❖ 47 Large Claimants over $100k for FY18 (Q3)

o Largest claimant $1,659,215 (Liveborn Infant with Respiratory Issues)o Two claimants had over $400k each in claims (Facial Fracture & Wilson’s Disease-Pharmacy)o $9,273,707 total paid claims over $100,000o Average claimant over $100,000 was $197,313

❖ 54 large claimants over $100k for FY17 (Q3)o One claimant was over $400k with Myeloid Leukemia at $454,980o $9,180,674 total paid in claims over $100,000o Average claimant over $100,000 was $170,012

Premera Medical

4

Large Claims Analysis – FY17 vs. FY18

FY17 (Q3) FY18 (Q3)

Medical & Rx Plan Spend $36,309,962 $35,966,123

Average Monthly Employees 3,423 3,276

PEPM Cost $1,179 $1,220

% Change 3.5%395.50% 387.83%

Total Paid for Large Claimants (Over $100k) $9,180,674 $9,273,707

# of Large Claimants (Over $100k) 54 47

Average Large Claimant $170,012 $197,313

Average Large Claimant % Change 16.1%

Without large claims $27,129,288 $26,692,415

PEPM Cost $881 $905

% Change Over Previous Yr 2.8%

25.3% 25.8%

74.72% 74.22%

University of AlaskaLarge Claimants Over $100,000

Large Claims above $100k as a percentage of Total Medical &

Rx Claims

25.3%

FY17

25.8%

FY18

5

Top 20 Claimants

Paid Claims Period: July 1, 2017 through March 31, 2018

Claimant Status Diagnosis YTD Claims

1 Active Respiratory Conditions Originating in the Perinatal Period $1,659,215

2 Active Fracture of Skull & Facial Bones $466,539

3 Active Wilson's Disease (Pharmacy) $400,089

4 Inactive Lung Cancer $365,213

5 Active Leukemia $340,579

6 Inactive Spondylosis $265,003

7 Inactive Pyogenic Arthritis $239,812

8 Active Intracranial Injury/Intracranial Hemorrhage $229,129

9 Active Breast Cancer $201,544

10 Inactive Colon Cancer $189,848

11 Active Gallstones $189,583

12 Active Fracture of Cervical Vertebra and Other Parts of Neck $186,686

13 Active Upper Back Pain $176,901

14 Active Heart Disease $175,745

15 Active Scoliosis $172,402

16 Active Lung Cancer $167,765

17 Active Prostate Cancer $164,291

18 Active Multiple Myeloma - Pharmacy (Blood/Bone Cancer) $163,129

19 Active Scoliosis $159,666

20 Active Spondylosis $144,316

Total $6,057,455

• 47 Large Claimants with claims over $100,000• Total Claims over $100,000 was $9,273,707

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Major Diagnostic Category – Medical Only

Major Diagnosis Category

Paid PMPMTotal Paid

Claims

Percentage of

Overall TotalPaid PMPM

Total Paid

Claims

Percentage of

Overall Total

Health Status & Services $58.73 $4,031,329 13.65% $84.76 $5,550,489 18.7%

Musculoskeletal System $78.54 $5,390,821 18.25% $72.50 $4,747,691 16.0%

Injury and Poisoning $26.35 $1,808,637 6.12% $36.54 $2,393,126 8.1%

Ill-Defined Conditions $33.57 $2,304,504 7.80% $34.50 $2,259,376 7.6%

Neoplasms $47.16 $3,237,256 10.96% $32.86 $2,151,704 7.3%

Mental Disorders $28.10 $1,928,935 6.53% $28.02 $1,834,965 6.2%

Digestive System $20.32 $1,395,060 4.72% $27.50 $1,801,142 6.1%

Circulatory System $33.93 $2,328,951 7.89% $26.67 $1,746,726 5.9%

Nervous System $24.14 $1,656,760 5.61% $21.28 $1,393,402 4.7%

Pregnancy and Related $15.36 $1,054,417 3.57% $18.09 $1,184,515 4.0%

Genitourinary System $17.16 $1,177,814 3.99% $16.49 $1,079,767 3.6%

Endocrine, Metabolic and Immunity $14.65 $1,005,429 3.40% $14.93 $977,921 3.3%

Respiratory System $12.16 $834,369 2.83% $14.18 $928,666 3.1%

Eye Disorders $1.92 $166,799 0.56% $7.70 $504,278 1.7%

Skin and Tissue $5.33 $438,438 1.48% $5.16 $337,850 1.1%

Perinatal $0.56 $63,576 0.22% $3.39 $221,915 0.7%

Blood $2.43 $168,612 0.57% $2.69 $175,919 0.6%

Ear Disorders $0.01 $6,288 0.02% $2.16 $141,689 0.5%

Congenital Anomalies $0.93 $131,631 0.45% $2.14 $139,892 0.5%

Infectious and Parasitic $2.46 $365,711 1.24% $1.57 $102,757 0.3%

Injury and Poisoning External Causes $0.09 $38,748 0.13% $0.00 $297 0.0%

Other $0.00 $0 0.00% $0.00 $0 0.0%

Total $423.90 $29,534,086 100.0% $453.13 $29,674,089 100.0%

7/1/16 - 3/31/17 7/1/17 - 3/31/18

7

Member Responsibility

Member cost share includes Medical/Rx/Dental

FY 18 (Q3)

Allowed Charges $49,373,873

Subrogation, COB, Etc. $1,743,690

Deductible $3,980,562

Copays $469,344

Coinsurance $4,123,861

Member Responsibility $8,573,766Member Cost Share

(% of Allowed Charges)17.4%

FY 17 (Q3)

Allowed Charges $50,450,261

Subrogation, COB, Etc. $1,633,097

Deductible $4,033,764

Copays $498,951

Coinsurance $4,680,629

Member Responsibility $9,213,344Member Cost Share

(% of Allowed Charges)18.3%

Employee Out of Pocket

Employee Out of Pocket

L O C K T O N C O M P A N I E S

Premera - Pharmacy

9

Pharmacy FY17 to FY18 Comparison

The average number of members decreased from 7,630 FY17 to 7,276 FY18.

Cost FY17 Q3 FY18 Q3 % ChangeTotal Gross Cost $6,775,876 $6,292,034 -7.1%

Total Net Cost $6,089,602 $5,642,538 -7.3%

Drug Mix

% Single Source Brands 17.3% 16.5% -4.7%

% Multi Source Brands 1.8% 1.5% -14.9%

Generic Dispensing Rate 80.9% 82.0% 1.3%

Utilization

Total Prescriptions 41,707 39,507 -5.3%

% Retail Prescriptions 83.4% 84.2% 0.9%

% Mail Prescriptions 16.6% 15.8% -4.7%

Average # of Scripts per Member 0.6 0.6 0.0%

Specialty

Specialty Total Gross Cost $2,223,315 $2,470,645 11.1%

Specialty % of Total Gross Cost 32.8% 39.3% 19.7%

10

Top 25 Drugs by Gross Cost

Specialty Drugs make up 15 of the

top 25 drugs

Rank Members Plan Cost Cost Per Member

1 15 $491,846 $32,790

2 7 $388,907 $55,558

3 11 $289,839 $26,349

4 32 $117,759 $3,680

5 1 $111,727 $111,727

6 1 $103,841 $103,841

7 3 $100,238 $33,413

8 1 $94,637 $94,637

9 2 $92,518 $46,259

10 40 $83,532 $2,088

11 7 $83,483 $11,926

12 31 $81,602 $2,632

13 22 $74,739 $3,397

14 3 $73,911 $24,637

15 1 $65,392 $65,392

16 1 $59,309 $59,309

17 1 $58,916 $58,916

18 50 $56,576 $1,132

19 1 $54,538 $54,538

20 7 $51,779 $7,397

21 39 $50,578 $1,297

22 1 $48,883 $48,883

23 33 $47,799 $1,448

24 19 $46,760 $2,461

25 2 $45,374 $22,687

$2,774,483 $876,396

JANUVIA No Non-Insulin Hypoglycemic Agents

CIMZIA Yes Anti-Inflammatory

GILENYA Yes Neurological Therapy

RESTASIS No Eye Drops

LATUDA No Antipsychotics

SYMBICORT No Pulmonary Agents

ADVAIR DISKUS No Pulmonary Agents

TARCEVA Yes Chemotherapy

REBIF Yes Interferons

POMALYST Yes Multiple Myeloma

OTEZLA Yes Rheumatoid Arthritis

ARANESP Yes Anemia

NOVOLOG FLEXPEN No Insulin Therapy

VICTOZA 3-PAK No Non-Insulin Hypoglycemic Agents

LANTUS SOLOSTAR No Insulin Therapy

ENBREL SURECLICK Yes Rheumatoid Arthritis

XTANDI Yes Prostate Cancer

HARVONI Yes Hepatitis C

JADENU Yes Chronic Iron Overload

COPAXONE Yes Neurological Therapy

NOVOLOG No Insulin Therapy

SYPRINE No Wilson's Disease

TECFIDERA Yes Neurological Therapy

ENBREL Yes Rheumatoid Arthritis

Specialty Drug Chapter

HUMIRA PEN Yes Rheumatoid Arthritis

Drug Name

11

Top 25 Drugs by Script Count

Drug Name Specialty Drug Drug Type Rx Count Member Count Total Net Paid Cost Per MemberDEXTROAMPHETAMINE-AMPH N Generic 374 78 $26,307 $337.26

METOPROLOL SUCCINATE N Generic 315 108 $13,334 $123.46

BUPROPION XL N Generic 461 160 $19,308 $120.67

ESCITALOPRAM OXALATE N Generic 495 167 $11,896 $71.23

ATORVASTATIN CALCIUM N Generic 796 307 $20,140 $65.60

GABAPENTIN N Generic 334 113 $6,201 $54.87

PROAIR HFA N Brand 359 282 $14,364 $50.94

VENLAFAXINE HCL ER N Generic 322 93 $4,372 $47.01

LISINOPRIL N Generic 890 324 $13,182 $40.68

LOSARTAN POTASSIUM N Generic 372 144 $5,676 $39.42

METFORMIN HCL N Generic 403 146 $5,527 $37.85

LEVOTHYROXINE SODIUM N Generic 899 314 $10,770 $34.30

AMLODIPINE BESYLATE N Generic 330 127 $4,161 $32.76

VALACYCLOVIR N Generic 318 181 $5,905 $32.62

MONTELUKAST SODIUM N Generic 441 173 $4,975 $28.76

SERTRALINE HCL N Generic 429 146 $3,980 $27.26

HYDROCHLOROTHIAZIDE N Generic 370 142 $2,919 $20.56

OXYCODONE-ACETAMINOPHE N Generic 347 223 $3,959 $17.75

SYNTHROID N Brand 372 90 $1,500 $16.67

HYDROCODONE-ACETAMINOP N Generic 552 367 $3,423 $9.33

AMOXICILLIN-CLAVULANAT N Generic 327 279 $2,515 $9.01

ALPRAZOLAM N Generic 332 157 $1,116 $7.11

OMEPRAZOLE N Generic 408 181 $831 $4.59

AZITHROMYCIN N Generic 352 320 $815 $2.55

AMOXICILLIN N Generic 384 340 $407 $1.20

Total 10,982 4,962 $187,585

L O C K T O N C O M P A N I E S

Appendix

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Medical Utilization Definitions

❖ Contract Months – Number of enrolled employees for a 12 month period

❖ Medical Total PMPM – Total medical cost on a per member per month basis

❖ Inpatient – Services provided to patients who are hospitalized

❖ Outpatient – Hospital based services where the employee is not admitted

❖ Professional – Primary Care or Specialist Care Physician services

❖ Average Contract Size – The average number of dependents (Spouse and Children) for each enrolled employee

14

Major Diagnostic Code Definitions

The Major Diagnostic categories are aligned with the major sections of the

ICD9-CM. In general, categories 780-796 include the more ill-defined

conditions and symptoms that point with perhaps equal suspicion to two or

more diseases or to two or more systems of the body, and without the

necessary study of the case to make a final diagnosis. Practically all

categories in this group could be designated as "not otherwise specified,"

or as "unknown etiology," or as "transient."

Examples: Fever, Convulsions, Chest Pain, Abdominal Pain.

Other

The Major Diagnostic categories are aligned with the major sections of the

ICD9-CM. The “Other” category consists of claims with diagnoses that

don’t map to the ICD9-CM, mostly Rx and Dental claims. Excluding those

benefits from the Benefit checkbox list will usually reduce “Other” to a

negligible amount.

Also known as "V-Codes" (i.e., V70.0) Usually used as a secondary

diagnosis, but sometimes appears in the primary. Full details available in

the ICD9 diagnosis book. General Medical Examination is common

1.      Non-sick persons encountering the system (donors, family doc

counseling, vaccines, etc)

2.      Sick person encountering the system for treatment of a known

(ongoing) disease or injury.

3.      When a circumstance or problem is present that influences the

patient's health, but isn't itself an illness (personal or family history health

hazards, circumstances related to reproduction and development, etc)

Injury & PoisoningFactures, Wounds, Burns, Poisoning by Drugs, Medicinal and Biological

Substances (DX Code 800 - 999)

Factures, Wounds, Burns, Poisoning by Drugs, Medicinal and Biological

Substances (DX Code E800 - E999)Transport accidents (E800-E848) include accidents involving:

aircraft and space craft (E840-E845)

watercraft (E830-E838)

motor vehicle (E810-E825)

railway (E800-E807)

other road vehicles (E826-E829)

Injury & Poisoning

External Causes

Ill Defined category

Health Status and

Services