CA members face higher health care costs

Members of CalPERS in eight California counties could find themselves in a health care plan that is more expensive than the one they have now.

The retirement system is considering replacing its HMO in those counties with a point-of-service plan.

Union leaders are balking at the proposed benefit changes and vow to press the issue when trustees act on the 2007 health benefits plan next week.

"These proposals are just another means of shifting the cost of health care from the employer to the employee without really looking at what is happening to drive up the cost of health care," said Yvonne Walker, a negotiator with the Service Employees International Union Local 1000, the largest union representing state workers. "As the cost goes up for co-pays, people will most likely hold off on treatment."

Some key changes on the table are:

• Increasing HMO co- payments to $15 from $10 for physician visits;



• Requiring members enrolled in preferred provider organization plans to obtain prior authorization for expensive imaging procedures such as MRIs or CT scans;



• Creating a PPO urgent-care network with a $20 co-pay;



• Introducing a new lower-cost Blue Cross of California PPO program that eliminates high-cost doctors. The plan would cut the number of physicians in the current network in half;



• Dropping HMO coverage in five rural counties: Colusa, Lake, Mendocino, Plumas and Sierra; and



• Replacing the HMO plan in Butte, El Dorado, Glenn, Mariposa, Napa, San Luis Obispo, San Mateo and Sonoma counties with a lower-cost point-of-service program.

In all, the proposals follow the fund’s recent cost-cutting strategy that included establishing prices by region, steering members to generic drugs and dropping HMO coverage at 23 higher priced hospitals, including 13 owned by Sacramento-based Sutter Health.

"Those (changes) are still reaping benefits," Grevious said. The smaller hospital network saved an estimated $36 million in 2005.