Pharmacy Benefits Management Services for the City of Houston’s Self-Funded Medical Plans

The City of Houston is soliciting proposals for third-party Pharmacy Benefits Management services to administer the city's self-funded medical benefit plans for employees and dependents, with proposals due September 17, 2026 under RFP 2026-0020.

The contract spans a five-year initial term with two optional one-year renewals, extending to a maximum of seven years. Minimum qualifications require at least five years of PBM experience managing plans with 5,000 or more covered lives; a comprehensive national pharmacy network with real-time adjudication; mail-order pharmacy services; robust reporting and analytics capabilities; and Texas licensure. Proposers must meet all stated minimum requirements or face rejection.

Scope includes claims processing, formulary management, prior authorization, network pharmacy administration, mail-order coordination, specialty pharmacy services, member communications, fraud and abuse prevention, and compliance with HIPAA and applicable federal and state pharmacy regulations. The contractor must implement the City's specified prescription drug benefit design, copayment structures, and deductibles as outlined in Attachment C, and must comply with the City's Security Compliance Standard (Attachment D) regarding protection of protected health information and data security controls throughout the contract term.

Proposers must submit a Technical Questionnaire (Attachment H) addressing operational infrastructure, clinical programs, pharmacy network adequacy, generic utilization strategies, and experience serving similar municipal or self-funded populations; a Financial Questionnaire and Cost Proposal (Attachment J) with detailed pricing methodologies, administrative fee structures, drug-cost margins, and rebate pass-through mechanisms; and evidence of financial stability and adequate insurance. The City has provided historical pharmacy claims data (Attachment F) and a Formulary and Network Disruption Analysis (Attachment I) to support proposal development. All bidders must sign a Non-Disclosure Agreement (Attachment B). Specific evaluation criteria, incumbent contractor information, and detailed pricing terms are contained in the full RFP document accessible through Beacon Bid at www.beaconbid.com.