Category Archives: Investing and fiduciary requirements

Walgreen, Express Scripts sign new agreement

By , AP

July 19, 2012

The Walgreen pharmacy chain will begin filling prescriptions from customers in the Express Scripts network again starting in September under a new multiyear contract that ends a costly impasse between the companies.

The agreement announced Thursday follows a series of disputes between Walgreen and Express Scripts that ended with the discontinuation of the contract between the drugstore operator and the pharmacy benefit manager last year.

The terms of the new agreement were not disclosed.

And Walgreen’s biggest drugstore rival, CVS Caremark, said it thinks it will keep a lot of the former Walgreen customers that it has won over the past year.

The developments illustrate the dexterity that providers are going to have to play to compete effectively in a rapidly changing health care marketplace.

Shares of Walgreen Co. jumped $3.29, or 10.6 percent, to $34.26 in afternoon trading Thursday while Express Scripts shares rose $1.33, or 2.3 percent, to $59.02.

Express Scripts administers prescription drug benefits for health plan sponsors and members, and it pays drugstores like Walgreen to fill prescriptions. Since January, Walgreen has not filled prescriptions for Express Scripts, saying the company was not paying enough in drug dispensing fees. Its sales have slumped since the split.

Express Scripts Holding Co. said it ended the contract with Walgreen because the drugstore operator wanted a premium compared to what Express Scripts paid other pharmacies. Walgreen Co. had said it would rather give up the revenue than continue filling unprofitable prescriptions. The dispute became public in June 2011. About a month later, Express Scripts agreed to buy one of its biggest competitors, Medco Health Solutions. That deal closed in April, and Walgreen could also have lost its business with Medco clients over the next few years as Express Scripts negotiated new deals.

The companies said in a statement Thursday that Walgreen will rejoin the network of pharmacies available to Express Scripts customers starting Sept. 15. Terms of the new contract were not disclosed.

“We are in the business of providing a broad range of pharmacy, health and wellness services to help meet the needs of all of our customers,” said Greg Wasson, president and CEO of Walgreens, in a statement. “I am pleased that Walgreens and Express Scripts have been able to reach an agreement that works for both parties and is consistent with our company’s principles.

Analysts said Walgreen probably made the biggest concessions in the deal because the split hurt its business more than it hurt Express Scripts.

“After speaking with Express Scripts, we don’t believe that Express Scripts budged in negotiations as it has seen limited disruption since ending its relationship with Walgreen,” said Citi Investment Research analyst Deborah Weinswing. She said the deal is likely to hurt Walgreen’s profit margins. She added that it’s not clear how many customers Walgreen will regain.

CVS Caremark said it expects to keep at least half the business it gained from Walgreen starting in late 2011 when the defections from Walgreen started ahead of its split with Express Scripts.

CVS also said it gained about 3 cents per share in income from the Walgreen-Express Scripts dispute in the first quarter and expects another 3 to 4 cents per share in the second quarter. The company said Friday it expects a smaller gain of 5 cents per share spread over the last two quarters of 2012.

Looking for ways to gain new business, Walgreen said in June that it had agreed to pay $6.7 billion to buy a stake in European health and beauty retailer Alliance Boots. In early July it agreed to buy Stephen L. LaFrance Holdings, which runs 144 drugstores focused in the mid-South, for $438 million.

Before the companies’ contract lapsed, Express Scripts filed a lawsuit against Walgreen, accusing the drugstore chain of trying to lure away its customers. The lawsuit alleged that Walgreen told Express Scripts plan members, and especially Medicare Part D beneficiaries, that they would not be able to fill their prescriptions at Walgreen pharmacies unless they left Express Scripts and switched to a new pharmacy benefits management plan.

Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


The answer to that question varies per person.

 Presented by Reeve Conover

  How much salary should you defer into a retirement plan? Ultimately, the answer is “however much your budget allows you to contribute”. The big-picture question, however, is whether you need to contribute more to your retirement savings in order to maintain your lifestyle after your career is done.

 An Aon Hewitt analysis (The Real Deal: 2012 Retirement Income Adequacy at Large Companies) finds that the average corporate employee makes a pre-tax contribution equal to 7.2% of his or her pay to an employer-sponsored retirement plan. Aon Hewett has found this level of contribution to be pretty consistent across the past few years. The Employee Benefit Research Institute puts the number at 7.5%.1,2

 Hopefully, these employees are basing their contributions on math. Retirement savings calculators are everywhere online, and while often criticized for their simplicity, they can bring you a useful ballpark figure. If you try them out, you may decide to boost your retirement savings rate as a result.

 As an example, using CNNMoney’s What You Need to Save calculator, a 34-year-old with $20,000 in retirement savings who makes $78,000 annually would need to save $11,544 a year to hope to retire at age 65 at 80% of pre-retirement income. That $11,544 represents 14.8% of his or her yearly salary.3

 Our hypothetical 34-year-old is quite affluent and has gotten a decent start on retirement savings compared to many of his peers – yet according to this calculation, a 7.2% retirement savings rate won’t cut it. Of course, the calculator is ignorant of such factors as home equity, inherited wealth, profit from business enterprises and so forth – but even so, many people are not saving enough for their retirement target.

 More to the point, many people are saving for retirement without a savings target.

   One established approach. If you are approaching your retirement years, you may be asking “How much do I need to save?” In the eyes of financial services professionals, the answer is linked to the question, “How much do you plan to withdraw?”

  In 1994, a financial advisor (and MIT grad) named Bill Bengen published a long and highly influential article in the Journal of Financial Planning advocating that retirees withdraw a little more than 4% of their retirement savings each year. Bengen’s suggestion was labeled the “4% rule”, and many financial services professionals paid attention to it when consulting their clients.4

 First, they helped their clients project how much would be needed to pay for planned annual retirement costs beyond what Social Security and pension benefits could absorb. Next, they asked clients to decide on a retirement savings withdrawal rate (4% or something else) in light of historical data. Then, they helped the client set a retirement savings target, roughly expressed as annual planned retirement expenses divided by the annual planned withdrawal rate, i.e., 45,000/.04 = 1,125,000, with $1.125 million being the target retirement savings goal. Lastly, a retirement savings rate was determined for the remainder of a client’s working years to him or her reach that goal (though the financial target could certainly be attained by other means).5

 There are even simpler approaches. Other financial services professionals simply suggest that you should estimate your planned retirement expenses and adopt a savings rate (taking historical data into account) that you feel comfortable with in order to reach them. After all, different people derive retirement savings from different sources beyond 401(k)s and IRAs, and make different asset allocation choices with their investments.

 So what is that savings rate, and how then might it be reasonably figured? Some retirement planners suggest a simple rule of 12 – take your current salary, multiply it by 12, and what you get represents the minimum savings you need for retirement.

  The simplest approach of all might work better than any other – just save as much as you can. The Center for Retirement Research at Boston College notes that the median U.S. income in the 2010 U.S. Census was $43,084. A 35-year-old with that income and $0 retirement savings would need to defer about 18% of his or her pay annually to have enough to retire at 80% of salary at age 68, with his or her portfolio returning a hypothetical 4% every year for 33 years.2

 CRR director Alicia Munnell claimed to U.S. News & World Report that staying on the job (and waiting longer to claim Social Security) can have a bigger impact on retirement saving than portfolio performance. “If people could work until they’re 70, they would have a much higher chance of having a secure retirement. Social Security is higher if you wait until age 70, and it gives your 401(k) assets a longer chance to grow, and it reduces the number of years you have to support yourself.”2

Save now; save avidly; save consistently. As you do, remember that if you don’t yet have a huge IRA or 401(k), it isn’t the end of the world – retirement savings and retirement income can be generated from other sources, some less exposed to the volatility of the financial markets.

 Reeve Conover may be reached at 877-423-9990 or

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is not a solicitation or a recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.


1 – [6/8/12]

2 – [2/1/12]

3 – [3/6/12]

4 – [5/6/11]

5 – [5/11]

SC Blue Cross announces COBRA Administration Conversion to Ceridian

BlueCross BlueShield of South Carolina is pleased to announce that we have contracted with Ceridian COBRA Continuation Services, an industry leader in COBRA administration. On behalf of BlueCross, Ceridian is an independent company that provides COBRA administration services.


This partnership will allow us to provide enhanced COBRA administration to our customers. Since 1986, Ceridian has provided the tools necessary to comply with federal laws and perform compliance functions for thousands of employers.


This notice applies to existing groups and new sales with BlueCross BlueShield of South Carolina Major Group, BlueCross BlueShield of South Carolina Small Group, BlueChoice HealthPlan, Planned Administrators, Inc. (PAI) and Thomas Cooper (TCC).


The services are for all COBRA-eligible products if paired with a BlueCross health plan. This upgrade provides our customers with an improved level of service including:



§         Web access for employers, which includes online submission of notices and online reporting


§         Web access for participants, which includes online submission of coverage election and premium payments



We will begin placing new clients on the Ceridian platform in the near future.  Existing customers will transition to the Ceridian platform over the next few months. Additional details for that schedule will be forthcoming.


We are excited to provide this added-value service to our customers through Ceridian. Please contact your marketing representative for more information. 

Weekly Economic Update for July 23 2012





“Live out of your imagination, not your history.”


– Stephen R. Covey




If you are serious about buying a home, getting pre-approved by a lender can give you a better chance of making a serious offer.




I nearly always lie on a surface, and I come in different shapes and sizes, often with curves. You can put me anywhere you like, yet there is only one proper place for me. What am I?



Last week’s riddle:

Note this alphabetic progression: B, C, D, E, G. What letter should then follow as the sixth letter in this successive series?


Last week’s answer:

P (the next letter in the alphabet with the same rhyming sound).


July 23, 2012



The federal government’s Consumer Price Index was flat in June, though the core CPI (minus food and energy prices) did rise 0.2%. Statistically, this was exactly what economists surveyed by MarketWatch had expected. Annualized inflation was running at 3.9% back in September; it was just 1.7% in both May and June.1


According to the Commerce Department, housing starts were up 6.9% for June to the highest level since October 2008. The average interest rate on the 30-year FRM fell to a new record low of 3.53% in Freddie Mac’s July 19 survey, as did the average rate on the 15-year FRM (2.83%). Existing home sales, however, slipped badly in June – the National Association of Realtors said the sales volume slowed 5.4% to a pace unseen in nine months. Sales were still 4.5% improved from a year before.2


They have now declined for three straight months, and a retreat of that length hasn’t been recorded by the Commerce Department since July-December 2008. Analysts polled by Bloomberg News had forecast an increase of at least 0.2%.3


Spain’s projection of recession into 2013 sent European shares down about 1% on Friday, with yields on Spanish bonds topping 7%. The Dow fell 121 points on the day, but on the week it rose 0.36% to close at 12,822.57 Friday. The NASDAQ (+0.58% to 2,925.30) and S&P 500 (+0.43% to 1,362.66) also posted five-day gains. After a 4.98% weekly gain, NYMEX crude settled Friday at $91.44 per barrel.4,5

THIS WEEK: Earnings season is in full swing, with McDonalds, Hasbro, Baidu, Halliburton and Texas Instruments offering results Monday. Tuesday, Q2 results are in from Apple, Broadcom, DuPont, UPS, Aflac and AT&T. Wednesday, the Census Bureau publishes June new home sales data and Ford, ConocoPhillips, Symantec, PepsiCo, Bristol-Myers, GlaxoSmithKline, Western Digital, Boeing, Caterpillar, VISA, WholeFoods and Zynga issue earnings reports. On Thursday, new initial claims figures are in along with the latest pending home sales report from the NAR and data on hard goods orders in June; earnings arrive from ExxonMobil, 3M, Pulte, Sprint, Expedia,, Starbucks, Amgen, Facebook, Dow Chemical, AstraZeneca and Credit Suisse, and a Commodity Futures Trading Commission emergency meeting will be held in response to the PFGBest scandal. Friday brings the final University of Michigan consumer sentiment survey for July, the second estimate of Q2 GDP and earnings from Barclays, Merck, DR Horton and Chevron.

DJIA +4.95 +1.99 -1.49 +5.99
NASDAQ +12.29 +3.95 +1.77 +12.18
S&P 500 +8.35 +2.78 -2.24 +6.07
10 YR TIPS -0.67% 0.62% 2.60% 3.10%

Sources:,,, – 7/20/124,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.


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This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.


1 – [7/17/12]

2 – [7/19/12]

3 – [7/16/12]

4 – [7/20/12]

5 – [7/20/12]

6 – [7/20/12]

6 – [7/20/12]

6 – [7/20/12]

6 – [7/20/12]

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6 – [7/20/12]

6 – [7/20/12]

6 – [7/20/12]

6 – [7/20/12]

7 – [7/20/12]

7 – [7/20/12]

8 – [7/10/02]


One in 10 employers to drop health coverage

By   July 24, 2012

About one in 10 employers in the United States say they’ll drop health coverage for employees in the next few years as the major provisions of the Patient Protection and Affordable Care Act take effect, and more indicated they may do so over time, a survey by consulting company Deloitte finds.

Opponents of health reform have argued that employers dropping health coverage is an unintended consequence of the law that will negatively affect employees who want to stick with the coverage they know and like.

Employer-sponsored health insurance covers more than 160 million Americans.

There’ve been conflicting reports over how many employers will drop coverage for employees, with Deloitte’s report predicting a lesser impact than some. Last year, consulting firm McKinsey & Co. drew fire from when they stated 30 percent of respondents will “definitely” or “probably” stop offering employer-sponsored health insurance after 2014.

According to the Deloitte survey, 9 percent of companies said they expect to stop offering insurance in the next one to three years. Around 81 percent said they plan to continue providing benefits, and 10 percent weren’t sure. Most employers said they offer health benefits to attract and retain employees and sustain job satisfaction.

But more employers said they might drop coverage if state health insurance exchanges and other elements of the law are implemented and effective. Using Deloitte’s Health Reform Impact Model, the Center for Health Solutions examined the effects of an employer exit from benefits, as well as three other possible scenarios resulting from the likely impact of the PPACA on health insurance coverage. Under the different scenarios, it was estimated that potentially between 23 million and 65 million individuals may join a health insurance exchange by 2020.

But for the most part, the survey found, employers aren’t big fans of health reform. The majority, at 60 percent, say it’s a “step in the wrong direction.” Thirty percent say it’s a good start. Most employers also say their company isn’t well prepared to implement the 2014 provisions of the law. They also say they don’t fully understand it.

Overall, employers believe the U.S. health care system underperforms. Thirty-five percent of employers surveyed grade system performance as an “A” or a “B,” while 64 percent give it a “C,” “D,” or “F.” Employers hold favorable views about the system’s clinical capabilities and medical innovation and unfavorable views center on its wastefulness and high costs.

Employers say high health costs are driven most by hospital costs, followed by inefficiencies, unhealthy lifestyles, prescription drug costs, insurance company costs, and government regulation.

The study, conducted between February and April, surveyed corporate and human-resources executives from 560 companies currently offering benefits.

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Reeve Conover is a Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/dealer member FINRA/SPIC. Cambridge and Conover Consulting are not affiliated. Licensed in SC, NC, NY, CT, NJ, and CA. - SIPC - Brokercheck