Penn State selects new third-party administrators for health care benefits

August 17, 2017

UNIVERSITY PARK, Pa. — On Jan. 1, 2018, Aetna will become the third-party administrator (TPA) for the University’s medical benefits, and CVS Caremark will become the TPA for the University’s prescription drug benefits, both replacing Highmark, which has been the TPA for the medical and prescription drug benefits plans for the past ten years.

David J. Gray, senior vice president for Finance and Business/Treasurer, says it is standard business practice to complete requests for proposals on a periodic basis.  

“The end of the current third-party administrator contract was an opportunity for Penn State to test the market.” Gray said. “This ensures that employees and the University are benefiting from the most competitive and favorable in-network discounts, broad access to high-quality providers of health care services, and reduced administrative costs.”                

Since last summer, faculty, staff and administrators with expertise in health care, health insurance, finance, procurement and human resources have been collaborating and reviewing proposals for new plan administrators. The steering committee’s recommendations were presented to senior leadership and approved.

The TPA review and selection processes were completed with adherence to the six guiding principles for the design of Penn State’s health care plan, which were approved as an advisory and consultative report by the Faculty Senate in 2016, and provided a foundation for all decisions pertaining to the selection.

Those six guiding principles recommend that Penn State consider the following regarding health care benefits:

  • Offer choice to employees;
  • Keep plans affordable;
  • Maintain a fair cost-sharing approach;
  • Make information accessible;
  • Provide informed use when implementing data warehouse and cost transparency tools; and
  • Foster a culture of health.

Human Resources will be communicating more information about the new vendors in the coming months, including answering important questions about ID cards, access to physicians, etc., through the Human Resources website, home mailings, the Penn State News site and Penn State Today.

For more information about the medical and prescription coverage TPA selection process, visit the 2018 medical benefits plan design website. Learn more about the Aetna and CVS Caremark, including frequently asked questions, on the website’s TPA welcome page.

Information about the new TPAs

Aetna is one of the nation's leading diversified health care benefits companies, serving an estimated 45 million people with information and resources to help them make better informed decisions about their health care. Aetna offers a broad range of traditional, voluntary and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans and medical management capabilities, Medicaid health care management services, workers' compensation administrative services and health information technology products and services.

Aetna has long standing, relationships with UPMC and Pinnacle Health, and expects these relationships to remain strong and to continue to evolve, further securing accesses to all UPMC and Pinnacle providers for many years to come.

CVS Caremark is a leading pharmacy benefits manager with nearly 90 million plan members, nearly 9,700 retail locations, and more than 1,100 walk-in medical clinics. CVS Caremark offers a dedicated senior pharmacy care business serving more than one million patients per year, expanding specialty pharmacy services, and a leading stand-alone Medicare Part D prescription drug plan, the company enables people, businesses and communities to manage health in more affordable and effective ways. 

Last Updated August 23, 2017