Pitt Ohio Healthcare Cost Optimization & Workforce Readiness — 5-year executive analysis with NPV, retirement readiness, cost interventions, and implementation roadmap

Healthcare Cost Optimization & Workforce Readiness

FP&A Executive Summary — Human Capital Strategy  |  5-Year Projection  |  NPV @ 10%
Pitt Ohio Express 2,933 Employees  |  2026 Update
Total 5-Yr Value Created
$114M
NPV @10%  |  Hybrid scenario
Cost of Inaction (Yr 5)
$70.6M
vs $45.9M today  |  +54% trend
Annual Savings Opportunity
$16.46M
Net of impl. costs  |  54.9× ROI
⚠️
Every year of inaction costs $4.1M in avoidable healthcare trend. At 9% annual growth, doing nothing adds $24.7M to the cost base by Year 5 — before workforce aging accelerates claims further.
Current Annual Spend
$45.9M
$15,665 per employee
5-Yr Savings (Hybrid)
$95.0M
NPV: $66.6M @10%
Total Value (Hybrid)
$130M
NPV: $114M @10%
5-year spend trajectory — all scenarios
Do Nothing Bolt-on Hybrid ★ Unbundled Yr 5 gap: $8.6M/yr vs Hybrid
scenario comparison — 5-yr ($M)
Scenario Yr 5 Spend 5-Yr Savings NPV @10%
★ Recommended. 9% annual trend. NPV discounted at 10%.
cumulative NPV @10%
Bolt-on Hybrid Unbundled
Key cost interventions — ranked by annual savings  net $16.46M/yr  |  54.9× ROI
① Risk Transfer ② Network / PBM ③ Wellness Admin / Validation Priority sequence mirrors boss's implementation hierarchy
② Network
Curated Provider Network Blue Cross (negotiated price set), Clarityn, PHCS/Multiplan active payer contracts. 15–20% unit cost reduction
$6.60M
① Risk
HCC — High Cost Case Mgmt 166 members driving $22.2M (up from $11M prior yr — 2× spike). Fedlosic case mgmt: End-Stage Renal, Cancer, Premature Birth. TPA: Highmark / CIGNA
$5.50M
① Risk
SIHRA — 454 Spouses 454 spouses remaining on plan (mandatory carve-out completed 2013). SIHRA incentive moves remaining to own employer plan. Net of incentive payments
$2.20M
② PBM
Rx Carve-Out — LucyRx Pass-through pricing via LucyRx + Care Guides navigation; eliminates spread. Avg 18% Rx savings
$0.94M
Validation
AVYM Audit + Contract Review Post-adjudication claims audit recovers improper payments; Innovu dashboards for ongoing data-directed validation
$0.90M
③ Wellness
Whole-Person Wellness + DPC Incentivized physicals, bio-metric screenings, EAP. DPC unlimited PCP access cuts ER utilization ~30%
$0.62M
Utilization Management Layer Inpatient · Outpatient · Radiology/Cardiology · MSK · Radiation Oncology · Lab & Genetic Testing
Intervention  — prioritized by filters
💰 Savings
⚙️ Effort
👥 Emp. Impact
SIHRA — 454 Spouses (net)
Phase 2 · ① Risk Transfer
HCC — High Cost Case Mgmt
Phase 1 · ① High Cost Intervention
Curated Provider Network
Phase 2 · ② Network
Rx Carve-Out — LucyRx PBM
Phase 2 · ② PBM
AVYM Audit + Contract Review
Phase 1 · Admin / Validation
Whole-Person Wellness + DPC
Phase 3 · ③ Wellness
Key: High Medium Low 💰 green = savings magnitude  ·  ⚙️ navy = implementation effort  ·  👥 orange = employee-facing change
$300K implementation cost  |  5-yr NPV @10%: $62.4M  |  Interventions roll out in phases — not all at once $16.46M / yr
retirement readiness — workforce at risk key finding
567 employees eligible for retirement (60+). Avg balance vs 3× salary target.
Ages 60–64 (397)55% funded
Ages 65–69 (140)54% funded
Ages 70+ (30)43% funded
Avg retirement balance$82,607
Avg target (3× salary)$222,090
Healthcare cost by age band
Under 50$11,200/yr
Ages 50–59$16,400/yr
Ages 60–64$21,800/yr
Ages 65–69$26,300/yr
If 60+ employees retire on time
$6.24M/yr saved
567 × avg $11,000 cost reduction
5-yr NPV @10%: $23.6M
phased retirement value — 5-yr
Salary savings Healthcare savings
5-yr NPV @10% — hybrid
$47.4M
Salary: $23.8M  |  Healthcare: $23.6M
implementation roadmap — phased rollout, value compounds over time
Phase 1  ·  Mo 1–6
① High Cost Intervention
High cost case mgmt launch (166 members), AVYM contract review & claims audit, data baseline. TPA selection: Highmark / CIGNA. Stop-loss: HM Ins, Symetra
↑ $6.40M unlocked
Phase 2  ·  Mo 6–12
② Network / PBM
Rx carve-out to LucyRx + Care Guides. Network: Blue Cross, Clarityn, PHCS/Multiplan. SIHRA rollout for 454 spouses. Innovu dashboards live
↑ $16.14M unlocked
Phase 3  ·  Year 2
③ Wellness + DPC
Direct Primary Care rollout, incentivized physicals, bio-metric screenings, EAP, Whole-Person program (physical, mental, emotional, financial, social)
↑ $16.76M unlocked
Phase 4  ·  Yr 2–5
⭐ Engagement + Workforce
Navigators, enrollment teams, Medicare programming, UKG interfacing, efficient enrollment. Phased retirement readiness & succession planning
↑ $26.86M/yr unlocked
Cumulative savings unlocked by phase (nominal)
$6.40M
After Phase 1
$16.14M
After Phase 2
$16.76M
After Phase 3 (run-rate)
$26.86M
Full program (Yr 5 run-rate)
Total 5-yr value created (Hybrid)  |  Phased rollout — not all at once
Nominal
$130M
NPV @10%
$114M
Pitt Ohio Express — Human Capital FP&A Model | Confidential  |  9% annual healthcare trend  |  NPV discounted at 10%  |  Healthcare cost by age: Milliman 2025 2,933 employees  |  2026 Update