Unions, CalPERS Oppose Brown’s High-Deductible Health Plan Pitch

During a state Senate subcommittee hearing on Wednesday, unions voiced their opposition to Gov. Jerry Brown's (D) plan to add high-deductible health plans to state workers' coverage options, the Sacramento Bee's "The State Worker" reports (Ortiz, "The State Worker," Sacramento Bee, 3/18).

Background

In February, the California Department of Finance released a proposed trailer bill to Brown's fiscal year 2015-2016 budget proposal that would require CalPERS starting on Jan. 1, 2016, to offer a high-deductible health plan, as well as a low-cost Medicare supplement plan for retirees (California Healthline, 2/3).

According to "The State Worker," Brown wants to add at least one high-deductible health plan in California that would lower monthly premiums and give individuals a tax-advantaged health savings account. Brown and other supporters have said the plans could save money by encouraging patients to "think twice" before they visit a doctor.

Brown plans to bargain with unions over the high-deductible coverage when their contracts expire.

Unions, CalPERS Oppose High-Deductible Plans

At the hearing, several organizations said Brown's plan would hurt state employees' health.

Dolores Duran-Flores, a lobbyist for the California School Employees Association, said, "Everywhere we see these high-deductible health plans we try to bargain them away because they're bad" for members.

Yvonne Walker, president of the Service Employees International Union SEIU Local 1000, agreed that the plans are "a very bad thing."

Ann Boynton, who directs health plan contracting for CalPERS, said the pension fund historically has avoided offering such health plans, noting that high deductibles could force individuals to delay seeking care.

Boynton added that CalPERS members who are covered by the fund's lowest-premium plan report being the most dissatisfied with their coverage because of high copayments and pricing among hospitals in preferred networks.

She also said that premiums for Brown's high-deductible plans could rise because of a small pool of employees covered by the new plans. In addition, premiums for CalPERS' other health plans also likely would increase, according to "The State Worker."

Meanwhile, some experts say it is unclear whether high-deductible plans would save money in the long term.

Nick Schroeder, a state-employee compensation expert at the Legislative Analyst's Office, said the effect of the plans cannot be determined without more information ("The State Worker," Sacramento Bee, 3/18).