On Wednesday, CalPERS' Health Benefits Committee recommended not raising PPO premiums for state and local government workers in 2009, as well as cutting premiums for its lowest-cost PPO plan by 3%, the Sacramento Bee reports. About 25% of people who receive health insurance through CalPERS are PPO members.
CalPERS said it was able to avoid premium hikes by persuading members to make lifestyle changes through healthier eating and exercise (Ortiz, Sacramento Bee, 5/15).
The rate cut for the low-cost PERS Select Plan was achieved in part because of a decision in 2004 to apply a third of estimated financial reserves for CalPERS' self-funded plans to reduce rates.
The same strategy does not apply to other CalPERS plans (Robertson, Sacramento Business Journal, 5/14).
About $60 million of CalPERS' $333 million surplus for health benefits will be used to sidestep premium increases next year. The remaining funds will be held in reserve.
The CalPERS Board of Administration is expected to approve the recommendation today (Sacramento Bee, 5/15).
HMO Rates
Rates for CalPERS HMO plans will be considered in June (Sacramento Business Journal, 5/14).