CalPERS Announces Health Plan Premiums for 2021

SACRAMENTO, Calif. – 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.

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. 

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.

The following chart represents the percentage premium change for each health plan, between 2020 and 2021. Note this reflects only the state, single-party premiums.

*Sharp Medicare Advantage is a new plan for 2021, therefore no comparison to the prior year is available.

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.

“We focused on bringing in high-quality plan expansions and benefit enhancements that will improve our members’ health,” said Don Moulds, chief health director. “We’re also optimistic that these investments may ultimately lower costs because they help prevent avoidable hospital admissions.”

The rates don’t include Association plan premiums as they are independently negotiated by each Association Board.

Four Basic plans – Blue Shield Trio, Sharp, UnitedHealthcare, and Western Health Advantage – reduced their administrative fees or made other concessions for the 2021 rates to help offset state worker pay cuts that took effect under the recently approved state budget.

There are no copay or coinsurance changes for 2021. Detailed information on 2021 rates for HMO, PPO, and association plans are available on the CalPERS website.

CalPERS members can change health plans during the annual Open Enrollment period, September 21 to October 16, 2020. Open Enrollment materials, information on health plan options, and custom search tools will be available through members’ myCalPERS accounts beginning September 14, 2020.

The premiums will take effect January 1, 2021.