The CalPERS Board of Administration approved health plan premiums for calendar year 2022, at an overall premium increase of 4.86%.
Premiums for CalPERS’ Medicare Advantage plans are declining across the board from the previous year.
Members enrolled in CalPERS’ Basic (non-Medicare) Health Maintenance Organization (HMO) plans will see an average premium increase of 4.69%. Preferred Provider Organization (PPO) Basic plan members will see an overall increase of 8.67%.
“We pushed our health plans and pharmacy benefit manager as hard as possible to secure the best premiums available for our members, ones that are lower than national averages,” said Rob Feckner, chair of the Pension & Health Benefits Committee. “We’re pleased the plans added lower-cost HMOs in areas where PPOs are the only option available, and that we were able to bring more affordable Medicare Advantage plans into our portfolio.”
“But going forward, it’s imperative that our health carriers work much harder to bring down costs because this trajectory of premium increases is unsustainable.”
Cost drivers for the overall 2022 premium increase include medical inflation, pharmaceutical inflation, and buydown adjustments to premiums made in 2021. For some plans, excess monies in their health care fund account were used to lower the plan’s premium.
COVID-19 related health care costs for 2022 are projected to be modest, although some increase in utilization for delayed and deferred care is expected.
Basic plan premiums reflect a new portfolio rating approach approved by the board in November 2020. This new risk mitigation strategy better aligns plan premiums with the value of their benefits and network instead of the mix of healthy or unhealthy lives in a plan. Portfolio rating will be phased-in over two years starting in 2022, and when fully implemented it’s expected to result in smooth and predictable premiums over time that will stabilize the Basic health plan portfolio.
For CalPERS PPOs, three current plans will change to two new plans, PERS Platinum and PERS Gold, that offer more distinction in benefit design, networks, and pricing.
The following chart represents the percentage premium change for each health plan, between 2021 and 2022 using the state, single-party premium.
|Basic Plans||% Premium Change|
|Anthem HMO Select||+5.94%|
|Anthem HMO Traditional||-1.82%|
|Blue Shield Access+ HMO and EPO||-4.13%|
|Blue Shield Trio||+2.79%|
|Health Net Salud y Más||+14.47%|
|Health Net SmartCare||+8.95%|
|PERS Gold PPO (from PERS Select)||+23.32%|
|PERS Platinum PPO (from PERS Choice)||+11.49%|
|PERS Platinum PPO (from PERSCare)||-14.85%|
|United Healthcare Alliance||+8.26%|
|United Healthcare Harmony*||N/A|
|Western Health Advantage||-2.08%|
|Total Basic Weighted Average Change||+5.65%|
|Medicare Plans||% Premium Change|
|Anthem Medicare Preferred||-6.05%|
|Blue Shield Medicare*||N/A|
|Kaiser Senior Advantage||-6.76%|
|PERS Gold PPO (from PERS Select)||+7.84%|
|PERS Platinum PPO (from PERS Choice)||+9.14%|
|PERS Platinum PPO (from PERSCare)||+0.18%|
|Sharp Direct Advantage||+7.96%|
|Western Health Advantage*||N/A|
|Total Medicare Weighted Average Change||-0.36%|
*New plan for 2022, therefore no comparison to the prior year is available.
New health plans, service expansions, and benefit design changes for 2022 were approved by the board in November 2020. Highlights of the changes for 2022 include:
- The addition of three new Medicare Advantage plans from Blue Shield, UnitedHealthcare, and Western Health Advantage and statewide expansion for Anthem Medicare Preferred.
- A new Western Health Advantage HMO plan in Humboldt County and new Blue Shield Exclusive Provider Organization plan in Shasta and Lassen counties.
- Blue Shield Access+ will reenter eight Bay Area counties it exited in 2019: Alameda, Contra Costa, Marin, San Francisco, San Mateo, Santa Clara, Sonoma, and Solano.
More information on the 2022 health plan changes and premiums for the HMO, PPO, and Association plans are available on the CalPERS website.
CalPERS overall program increase of 4.86% came in lower than the PwC Health Research Institute report, which estimated health care costs increasing by 6.5% for 2022.
“Premium affordability is paramount for our members, and it’s why we’re concentrating on increasing plan competition, implementing risk mitigation, and lowering pharmaceutical costs,” said Don Moulds, CalPERS chief health director. “We’re working year-round to improve choice and affordability for our members, including adding more HMO managed care products that are more cost-efficient and have lower unit costs compared to PPO fee-for-service plans.”
CalPERS members can change health plans during the annual Open Enrollment period, September 20 to October 15, 2021. Open Enrollment materials, information on health plan options, and custom search tools will be available on the CalPERS website and through members’ myCalPERS accounts beginning September 13, 2021.
Premiums will take effect January 1, 2022.