I. Call to Order and Introductions

Attendance: Committee Members Salem (Chair), Arias, Diamond, Gay, and Miller; CM Boylan

Also: Brian Parks and Kim Taylor, Auditor’s Office; Mary Staffopoulos, OGC; Steven Libby,

Council Research

Meeting convened: 11:05 am

Call to Order and Introductions: Chair Salem convened the meeting and called for introductions.

II. Public Comment

John Nooney

III.Update on Telehealth – CM Diamond

CM Diamond explained that he is completing a final draft and will discuss it with Telescope

Health before having it circulated to the other Council Members. He noted that he wants to wrap

up the telehealth investigation so the committee can shift its attention to other matters.

IV. Update on the 2% Lapse – Council Auditor’s Office

Kim Taylor, Council Auditor's Office, notified the committee that no departmental requests have

been received. She noted that departments would likely wait until the last quarter and that they

may be able to handle the lapse through vacancies. Ms. Taylor stated that she would reach out to

the Budget Office and the Finance Director for clarification. Chair Salem asked Ms. Taylor how

much was remaining from the 2% lapse. Ms. Taylor stated $3.5 million. Chair Salem

recommended that the committee examine future lapses in upcoming budgets.

V. City’s Group Health Plan Review - The Bailey Group

Mark Bailey, President of the Bailey Group, introduced Madison Cofield, Senior Analyst, to

present on medical repricing. Ms. Cofield gave an overview of the significance of medical

repricing, explaining that they evaluated the financial impact of several ASO carriers and

network arrangements to compare potential cost savings. Chair Salem confirmed that the study

compares Florida Blue, the City's current provider, to other providers. Ms. Cofield explained the

advantages and limitations of the two repricing methodologies used in the analysis: carrier

reported data and the Innovu Network Check. She stated that they ran both methodologies

hoping they would produce the same result, and they did. Ms. Cofield then clarified that the

repricing results are meant to serve as a guide and not to predict future performance. Ms. Cofield

presented the repricing results, which showed that the City's incumbent carrier had lower

allowed costs and stronger negotiated provider discounts than the three alternative carriers

evaluated.

Chair Salem asked whether the City could approach the incumbent carrier to negotiate lower

hospital costs to match a less expensive carrier. Ms. Cofield stated that the City could use the

repricing data as leverage and that they often see clients negotiate directly with hospital systems.

Chair Salem asked whether Carrier #1 is an insurance entity or a hospital system. Ms. Cofield

explained that they repriced claims against the major national carriers. Chair Salem asked

whether the City could examine Carrier #1's specific inpatient discounts and use them to

negotiate better pricing with Florida Blue. Mr. Bailey stated that it would likely not be possible

because the discount information is proprietary. Chair Salem asked how frequently the City

should conduct repricing analyses. Mr. Bailey recommended a five-year cycle for an organization

the size of the City, noting that smaller organizations typically reprice every three years. Chair

Salem asked when the City last put its health plan out to bid. Kim Taylor, Council Auditor's

Office, stated 2022.

CM Arias asked why the City renews annually without reviewing the repricing data and why the

analysis is only conducted every five years. Mr. Bailey stated that the City can conduct a market

check annually. He elaborated on the various factors involved in evaluating the City's health

plan, including utilization, discount arrangements, stop-loss coverage, network pricing, contract

negotiations, and administrative costs. He noted that these components shift from year to year.

Mr. Bailey concluded that the City could conduct an annual market check through its consultant.

CM Arias asked when the next renewal period is. Mr. Bailey stated January 1. Chair Salem noted

that the administrative fee is what the City pays Florida Blue to access its network. Mr. Bailey

confirmed that the administrative fee covers claims adjudication and network access, and that the

City pays a competitive fee for an account this size.

Ms. Cofield explained that the Innovu Network Check categorizes claims differently, breaking

results out by HMO and PPO rather than by inpatient, outpatient, and professional services. Ms.

Cofield recommended that the City maintain its ASO relationship with the current administrator

and added that they will work with actuaries to project future claims costs using the incumbent's

data and discount percentages.

CM Miller asked what the Bailey Group's recommendations would be if the City chooses to stay

with Florida Blue. Ms. Cofield stated that it would be prudent to examine utilization of inpatient

care and evaluate the care management platforms used by Florida Blue. Chair Salem asked

whose responsibility it is to inform and educate employees about better facilities or more

cost-effective options. Ms. Cofield stated that it is a shared responsibility among Gallagher,

Florida Blue, and the City's Human Resources department.

Chair Salem confirmed the rebate structure under the existing contract. Mr. Bailey noted that the

per-member fee is $29.71. Chair Salem suggested that it may be more cost-effective for the City to

receive rebates on a more frequent basis, noting that the City could put those funds to use sooner.

Mr. Bailey agreed.

CM Arias asked Mr. Bailey how much they get back in rebates. Mr. Bailey stated almost $6.5

million from the 2024 year. CM Arias asked whether the City could receive rebates on a periodic

basis rather than annually, and if not, whether the funds could be held in an interest-bearing

account. Mr. Bailey stated that the rebates are not currently held in an interest-bearing account.

He outlined several options available to the City, including negotiating rebates based on the type

of prescription, negotiating guarantees to account for rising utilization and drug costs, and

negotiating a minimum guaranteed rebate amount. He noted that the City cannot negotiate

rebates upfront. CM Arias asked how the City would transition to a periodic rebate schedule. Mr.

Bailey stated that the insurance committee would need to work with Gallagher to renegotiate the

terms with Prime Therapeutics.

Mr. Bailey highlighted that the City's total pharmacy cost and specialty pharmacy cost per

member per month both exceed the national average. He noted that the City's generic dispensing

rate is lower than the national average and identified it as a near-term opportunity to reduce

costs.

CM Arias asked Mr. Bailey whether the age demographics of the City's employee population

compared to the national average could be a contributing factor. Mr. Bailey stated that he would

investigate it for the next meeting. CM Arias asked how many members fall under the total cost

and specialty cost categories and whether there is overlap between the two. Mr. Bailey stated that

he would also investigate it for the next meeting. Chair Salem expressed concern that the City's

generic dispensing rate is below the national average, stating that the City should not be paying

for brand-name drugs when equally effective generic alternatives are available. Chair Salem

asked whether the City's current contract includes a mail-order provision and whether it

produces cost savings. Mr. Bailey confirmed that the contract includes one but stated that the cost

savings are insignificant due to legislative changes. CM Arias asked whether the City could

mandate generic prescriptions only, with members paying out of pocket for brand-name

alternatives. Mr. Bailey stated that it would be the most aggressive option but noted that many

accounts are implementing that approach.

Mr. Bailey highlighted diabetes as the highest-cost pharmacy class, driven by GLP-1 drugs, with

inflammation drugs ranking second. He noted that there could be opportunities to implement

stricter clinical criteria for GLP-1 prescriptions, including higher BMI thresholds and

documentation of comorbidities, to ensure the drugs are being prescribed for diabetes treatment

rather than weight loss. He also noted that biosimilars could serve as a cost-effective alternative to

more expensive biologic drugs for inflammation treatment.

Mr. Bailey highlighted that HIV medications are not classified as specialty drugs in the current

contract and reclassifying them would provide approximately $1.2 million more in rebates.

Sherry Bugnet, Senior Account Executive, clarified that classifying the drugs as specialty drugs

would make the drugs more costly for users while providing the city more in rebates. Mr. Bailey

noted that the City's current contract does not include pricing guarantees for specialty limited

distribution drugs and recommended implementing price controls. He noted that one specialty

drug alone accounts for $1.2 million in annual costs.

Mr. Bailey emphasized the potential savings of approximately $800,000 through the SaveOn

program and stated that they found very little cost difference in the ESI contract between

including or excluding CVS pharmacies. Mr. Bailey noted three excluded drugs require more

deliberate member transitions but emphasized that formulary alternatives are available. He

outlined strategies to facilitate the transition, including proactive member communication and

grandfathering provisions. Chair Salem emphasized the importance of identifying the affected

members and proactively reaching out to them regarding the transition. Mr. Bailey added that

the transition process begins 90 days before the effective date, with an additional 90-day

grandfathering period for members to transition to alternative medications.

Chair Salem asked Mr. Bailey whether the $4.2 million in savings quoted at the previous meeting

included the HIV reclassification rebates and the other cost-saving measures presented. Mr.

Bailey confirmed that those savings were included in the higher rebate figure. Ms. Bugnet noted

that the prior analysis did not account for changes to copay structures or efforts to increase

generic dispensing rates. Chair Salem noted that increasing the generic dispensing rate would

produce additional savings beyond the $4.2 million. Mr. Bailey confirmed.

Chair Salem asked whether the Bailey Group has been in communication with the administration

regarding the health plan review. Mr. Bailey stated that they have provided the requested

information and are awaiting feedback. Chair Salem confirmed with Mr. Bailey that the

recommended timeline is 90 to 120 days' notice to implement changes, ensuring that all members

are properly educated.

VI. Comments from Committee

CM Arias asked whether the committee should notify the administration that action is needed

and that conversations must begin at least 120 days in advance to ensure changes are in place by

January 1. CM Arias stated that the administration would need to respond prior to September 1

and noted that since the Special Committee on Duval DOGE concludes on June 30, ideally the

committee should have an understanding before that date. Chair Salem agreed, noting that the

timeline would be tight given that it would coincide with the budget process in late August.

Chair Salem confirmed with Mr. Bailey that the Bailey Group would return at the next meeting

to discuss other people covered by the City's health plan. Mr. Bailey added that staff would

coordinate with Gallagher to determine whether solutions have already been identified or

implemented.

Ms. Bugnet outlined the Bailey Group's upcoming work, including reviewing the benefits-eligible

population, working with actuaries to develop budget projections, and developing contribution

strategies. She noted that they are scheduled to return on April 21.

Chair Salem stated that the April 7 meeting would focus on the Jacksonville Transportation

Authority. Mary Staffopoulos, OGC, advised committee members to submit their JTA questions

to her in advance to comply with the Sunshine Law. She noted that she would coordinate getting

their questions to JTA.

VII. Adjourn

Chair Salem adjourned the meeting at 12:17 pm.

Minutes: Steven Libby, Council Research

slibby@coj.net, (904) 255-5147

Posted: 3/20/26, 4:00 p.m.