Union Pacific Railroad Named Apex Award Recipient by UnitedHealth Group

Railroad Has Reduced Employee Prescription Drug Costs 27 Percent Since 2006; Average $500 Savings Per Employee Plan Participant

Omaha, Neb., May 04, 2010 – UnitedHealth Group recently presented Union Pacific Railroad a 2010 Apex Award, honoring innovation and thought leadership displayed by employers and brokers working to improve the healthcare system. Union Pacific has reduced its management employee and company prescription drug costs by an average of nine percent annually for the past three years. By the end of 2009, average annual per-employee prescription costs fell from $1,992 per year in 2006 to $1,463. Employees realized the greater share of these savings in their out-of-pocket costs.

Shopping smart for prescription drugs pays, as employees receive 100 percent of the savings until they reach their annual deductible. Union Pacific offers its management employees a high deductible health plan (HDHP) option. The company contributes up to $2,600 in a Health Savings Account (HSA) for employees with family HDHP coverage, and up to $1,220 for employees with single coverage to help offset employees' deductible and other healthcare costs.

"Reducing employee prescription drug costs at a time when the national trend for prescription drugs was increasing at more than seven percent per year is a remarkable accomplishment," said Barb Schaefer, Union Pacific senior vice president - Human Resources.  "Our prescription program also saved money for the company, which allowed us to extend the life of other employee benefits at a time when many companies have been forced to make cuts."

Union Pacific achieved these results by implementing a customized mandatory mail order (MMO) program and educating employees on their prescription drug options. The MMO program provides employees name-brand prescription drugs at lower price points than retail pharmacies can achieve. Because market forces drove reductions in retail generic prescription pricing, Union Pacific removed many generics from its MMO program to allow employees to buy them for $4 at their local pharmacy. This presented Union Pacific employees with best-of-both-worlds pricing on brand and generic prescription drugs.

An aggressive communication campaign that included personalized mailings, newsletters, employee website news items and on-site benefit sessions educated employees on their prescription drug options and was a catalyst for their purchasing behavior changes. Union Pacific also guided employees and their family members to a prescription drug pricing tool that helps identify savings opportunities specific to their medications.

"Price is a deciding factor in medical adherence for some individuals and lower-cost alternatives make it easier for employees to continue their health maintenance," Schaefer said. "Studies and data clearly show that healthy employees are safer and have fewer injuries than non-healthy employees."

Now in its sixth year, the Apex Awards program is sponsored through UnitedHealth Group's hub magazine, a health care publication that examines employers' and care providers' best practices in improving access to affordable, quality health care. UnitedHealth Group employer customers of all sizes are eligible to apply for an Apex Award, and an independent judging panel, composed of leaders from across the health care industry, selects the winners based on employers' innovative approaches to specific health care challenges.
About Union Pacific

Union Pacific Corporation owns one of America's leading transportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country. Union Pacific serves many of the fastest-growing U.S. population centers and provides Americans with a fuel-efficient, environmentally responsible and safe mode of freight transportation. Union Pacific's diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad emphasizes excellent customer service and offers competitive routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada's rail systems and is the only railroad serving all six major gateways to Mexico, making it North America's premier rail franchise.

About UnitedHealth Group

UnitedHealth Group is a diversified health and well-being company dedicated to making health care work better. Headquartered in Minneapolis, Minn., UnitedHealth Group offers a broad spectrum of products and services through six operating businesses: UnitedHealthcare, Ovations, AmeriChoice, OptumHealth, Ingenix, and Prescription Solutions. Through its family of businesses, UnitedHealth Group serves more than 70 million individuals nationwide.

Union Pacific media contact:  Tom Lange, 402-544-3560 or tomlange@up.com.


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