CalPERS Announces Health Plan Rate Changes for 2021

CalPERS announced today (7/14/20) that it has negotiated employee and retiree health plan benefits for 2021. 

According to the CalPERS Press Release:

..... The CalPERS Board of Administration today approved health plan premiums for calendar year 2021, at an overall average premium increase of 4.32%.

Rates for CalPERS’ Medicare plans are declining across the board from the previous year. [Emphasis added]

Included in the approved rates are the addition of a new health plan, coverage area expansions, and benefit design enhancements for specific plans.

“In this time of unprecedented uncertainty, we pushed our health plans even harder to get the lowest premiums possible,” said Rob Feckner, chair of the Pension and Health Benefits Committee. “This year, we required more transparency and better identification of costs and projections by the health plans. This gave the plans very little wiggle room to increase costs that couldn’t be justified and gave us stronger negotiating power on behalf of our 1.5 million health program members.”

The overall impact of COVID-19 on CalPERS’ 2021 rates will be a modest 0.57%. Factors included in projecting COVID-19’s impact included the savings due to delayed and deferred care this year, which CalPERS was able to use to reduce rate increases for next year.

Members enrolled in CalPERS’ Basic (non-Medicare) Health Maintenance Organization (HMO) health plans will see an average premium increase of 4.44%. Members enrolled in Basic Preferred Provider Organization (PPO) plans will see an overall average increase of 8.54%.

Medicare HMO and PPO plans will see premiums decrease by 4.46% and 0.65%, respectively. [Emphasis added]

There’s no COVID-19 impact to the HMO Medicare Advantage plans and the PPO Medicare Supplemental plans since COVID-19-related costs are covered by Medicare. .... [Emphasis added]

Current Medicare advantage plans (HMOs) will see premium decreases ranging from approximately -1.23% to -4.73%, and a new plan, Sharp Medicare Advantage, has been added for San Diego residents. PPO Medicare supplement plans will see small decreases of approximately -0.40% for PERS Choice and PERS Select to -0.92% for the PERS Choice plan.

The CalPERS press release also noted that:

For 2021, the board approved new plan and benefit changes to deliver members more choices and improve health outcomes:

  • Blue Shield Trio HMO plan will expand into Santa Barbara, San Luis Obispo, and Ventura counties. This expansion benefits members in Santa Barbara county in particular, where a lower cost HMO option doesn’t currently exist.
  • Kaiser Senior Advantage will offer the supplemental benefits of post-hospital discharge meal delivery, post-discharge transportation, and routine transportation to medical care.
  • UnitedHealthcare Medicare Advantage will add post-hospital discharge meal delivery, post-discharge transportation, and non-skilled in-home care benefits.
  • A new Sharp Medicare Advantage plan will be offered in San Diego County to allow members to remain in the Sharp network when they become eligible for Medicare.
  • The Anthem Blue Cross Select Medicare Advantage service area will expand to the 23-county service area covered by the Basic plan. This allows families with members in a Medicare and Basic plan the choice to remain in the Anthem network. .......

Actual out-of-pocket costs to CSU retirees for the various health plans depends on several factors including whether or not the retiree is enrolled in Medicare (that includes most CalPERS retirees 65 years of age or older) or is in a CalPERS basic health plan (retirees under 65), and the number of dependents on the retiree's health plan, whether or not one or more dependents is eligible for Medicare, and the CSU's monthly health benefit contribution. For 2020, the CSU contributed $767 each month to retirees with no dependents, $1,461 per month to retirees with a single dependent, and $1,868 a month for retirees with 2 or more dependents. These contributions likely will increase somewhat for 2021.

Each year the CSU posts detailed charts on its retiree benefits page that allow retirees to determine exactly what their premiums and out-of-pocket expenses will be for their chosen health plan. The new charts for 2021 have not been posted yet. The following links to the 2020 charts provide examples of what these charts look like. We will advise you when the 2021 charts become available.

2020 In-State Health Plan Premiums

2020 Out-of-State Health Plan Premiums

Note: To obtain your out-of-pocket expense, you need to subtract the CSU monthly contribution from the numbers listed in the charts.