CalPERS Board To Vote on Lowest Premium Increases in Decade
The governing board of CalPERS on Wednesday will consider a measure to increase in health care premiums for members in 2008 by an average of 6.3%, the lowest premium increase in a decade, the Sacramento Bee reports.
CalPERS' Health Benefits Committee on Tuesday approved the proposal, which would translate to:
- An average increase of 7.4% for HMO coverage;
- An average increase of 4.2% for PPO coverage; and
- A 5.6% decrease in state retiree premiums (Chan, Sacramento Bee, 6/20).
In 2007, HMO premiums increased by 11.6% on average for CalPERS members (Colliver, San Francisco Chronicle, 6/20).
Overall, CalPERS plans to spend $5.3 billion in 2008 to cover 1.2 million public employees, up from $4.9 billion this year (Sacramento Bee, 6/20).
The health benefits committee also approved and sent to the full board a proposal to drop Sacramento-based Western Health Advantage as a coverage option for members next year (Robertson, Sacramento Business Journal, 6/19).
The proposal would force about 24,000 members of the health plan to switch to Kaiser Permanente or Blue Shield of California for HMO coverage.
CalPERS officials proposed dropping Western Health after the insurer declined to set rates exclusively for CalPERS members (Sacramento Bee, 6/20). According to the Business Journal, the committee recommended dropping Western Health in part because it does not meet CalPERS requirements for data and disease management and it does not have immediate plans to expand to other parts of California (Sacramento Business Journal, 6/19).
CalPERS trustees in May approved copayment increases for physician visits and brand-name prescription drugs. Higher copays for prescription drugs were projected to save about $30 million next year.
Trustees also approved a proposal by Blue Shield of California to drop its HMO coverage for CalPERS members in El Dorado, Napa, Lake and Plumas counties.
The four counties are considered among the most costly for health care services (California Heathline, 5/17).
Officials estimate that the changes together will result in $144 million in premium savings in 2008 (Sacramento Bee, 6/20).