CalPERS Announces 2024 Health Plan Premiums

The CalPERS Board of Administration today approved health plan premiums for calendar year 2024, at an overall premium increase of 10.77%.

Basic (non-Medicare) plans will increase 10.95% overall. Members enrolled in CalPERS’ Basic Health Maintenance Organization (HMO) plans will have an average premium increase of 10.50%. Preferred Provider Organization (PPO) Basic plans will have an overall increase of 12.17%. Medicare plan premiums will rise 9.55% overall.

“We recognize these premium increases are too high, but they will not deter our continued focus in providing access to high-quality, equitable care that improves health outcomes for our members,” said Ramón Rubalcava, chair of the Pension & Health Benefits Committee.

“The health care universe remains challenging with medical costs rising sharply; however, we have some plans bucking the trends, giving our members the choice to save money if they shop plans.”

The primary driver of the premium increases is rising costs due to high medical inflation. In the Basic program, Kaiser Permanente and the PPO plans are experiencing the highest increases. Medicare plan premiums are going up because health plans expect to receive less revenue from the Centers for Medicare & Medicaid Services (CMS) in 2024.

“While the Kaiser premium increase impacts half of our Basic members, there are several other high-quality plan choices in our portfolio with lower monthly premiums,” said Chief Health Director Don Moulds.

“We’re encouraging members to shop for more affordable health plans during this Open Enrollment season. In some areas of the state, members could save hundreds of dollars a month by changing plans.”

CalPERS will be providing members with more options to choose from as the Board approved the following health plan expansions for 2024, including:

• Blue Shield Access+ EPO plan expansion into Del Norte and San Benito counties.
• UnitedHealthcare Alliance HMO plan expansion into 12 counties for public agency and school members: Alameda, Contra Costa, Marin, Merced, San Francisco, San Joaquin, San Mateo, Santa Clara, Santa Cruz, Solano, Sonoma, and Stanislaus.
• UnitedHealthcare Harmony HMO plan expansion into Santa Clara and Santa Cruz counties.
• Western Health Advantage MyCare Select Medicare expansion into Humboldt County.

In addition, Health Net SmartCare will be removed from the CalPERS Health Program. The plan currently covers 8,600 members, who will need to choose a new plan during Open Enrollment held from Sept. 18 to Oct. 13, 2023.

The following tables represents the overall percentage premium change for each health plan between 2023 and 2024 using the state, single-party premium.

“We continue to experience rising costs in our Basic PPO plans that we know are unsustainable,” added Moulds. “We have been working on numerous strategies to curb future cost increases that will be reflected in our upcoming PPO solicitation later this year.”

Included in the Basic premiums is a continuation of CalPERS’ risk adjustment strategy, approved by the Board in 2020. Starting in 2024, the Basic HMO and PPO plans will begin a three-year transition into a single risk pool. The change is expected to stabilize enrollment across the HMOs and PPOs by pricing the plans based on the value of their benefits and network instead of the mix of healthy or unhealthy members in a plan.

The 2024 Basic and Medicare premiums for the three association plans offered within the CalPERS Health Program will increase 9.73% and 5.98%, respectively. The association boards independently negotiate the plan premiums and benefit designs for their dues paying members.

CalPERS members can shop health plans and make a change during Open Enrollment. Beginning September 11, members can find Open Enrollment information on the CalPERS website and customized information in their myCalPERS accounts. Using the Search Health Plans tool in myCalPERS, members can compare plan monthly premiums and copays, and search for primary care doctors and specialists to see which plans they participate in.

Premiums will take effect Jan. 1, 2024.