Investor Presentaiton

calculated $54.4 million in actual savings during the first year of the transition to FFS. While there is potential for cost savings, some states, like Florida, have determined a move to this model would be more costly. There may also be negative fiscal impacts to 340B pharmacies. Examples: Missouri, West Virginia, and Wisconsin. Pros • Potential decrease in capitation costs · Potential increase in federal drug rebates, which could lower costs Reimbursement consistency . Increased transparency-state has greater control of plan design and would streamline monitoring efforts Statewide consistency in pharmacy benefits administration Uniform formulary and coverage criteria • Leverages economies of scale Single PBM Cons Requires development of IT solutions for CCOs to access real-time pharmacy claims and drug utilization for care coordination Additional claims processing could strain current IT infrastructure Potential loss of provider tax revenue Potential negative impacts to 340B providers A single PBM model has been used in other states to contract with one PBM for Medicaid managed care or public employee health plans. For many health plans, Medicaid is not the only line of business, and may include private insurance or Medicare. Health plans typically contract with one PBM for all lines of business, and a move to a single PBM model may require plans to have contracts with multiple PBMs, which could reduce some operational efficiency. There is also a possibility some plans could withdraw from Medicaid. In this model, Oregon could have some flexibility to maintain 340B pharmacy revenues, depending on the program structure, whereas an FFS model would not offer this kind of flexibility. Examples: Ohio and Kentucky. Pros • Potential decrease in capitation costs • • Increased transparency- allows the state to set contract parameters and would streamline monitoring efforts Flexibility in pharmacy provider reimbursements • Uniform formulary and coverage criteria • Leverages economies of scale revenues, depending on structure Potential to preserve 340B pharmacy Cons Potential opposition from health plans Potential decreases in efficiency at the health plan level, due to multiple lines of business Potential loss of provider tax revenue 8 See West Virginia's 2019 Pharmacy Savings Report 9 See Florida's 2020 PBM Pricing Practices in Statewide Medicaid Managed Care Program Report Oregon Secretary of State | September 2022 | page 5

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