CalPERS board approves fee increase for health care plans

By JESSICA BRICE
Associated Press Writer

SACRAMENTO (AP) The nation's largest pension fund voted Wednesday to offset rising health insurance costs by boosting fees for certain medical services a move critics say will hurt CalPERS members, especially retirees.

The higher fees imposed by the California Public Employees' Retirement System for emergency room visits will curb costs by discouraging members from visiting the emergency room when a regular doctor's visit will do, said board member and insurance consultant Sidney Abrams.

``You certainly want to eliminate abusive patterns of utilization,'' he said. ``Beyond that, it shifts costs from some participants to other participants.''

Under the new plan approved Wednesday, CalPERS members who belong to Blue Shield of California, Kaiser or Western Health Advantage HMO plans will pay $50 for every emergency room visit an increase of up to $25 for regular members. The emergency room fee will also apply to members over the age of 65, who now pay nothing for the service.

California State Employees Association President Perry Kenny said the plan unfairly shifts the cost of medical care to the workers. He said it cheats former state workers over the age of 65 who are promised 100 percent medical coverage from the state.

``A hundred percent is a hundred percent,'' he said. ``They shouldn't have to pay anything.''

Members will also pay higher fees for prescription drugs not regularly covered by their health insurance plans. The fee will be waived if it's determined the drug is medically necessary.

Health insurance premiums overall will rise by an average of 16.7 percent to 18.4 percent next year for CalPERS' roughly 1.2 million members and their families who are enrolled in the plans. Members of the Sacramento-region provider Western Health Advantage will see the biggest percentage increase up to 34.5 percent but their overall premiums will still be the lowest in the system.

That translates into about $50 extra per month for a single member who's part of Kaiser or Blue Shield of California's HMO plans, and up to $72 per month extra for single members on the Western Health Advantage plan.

Premiums for the PERSCare preferred provider network, the system's most expensive plan, will drop slightly, while CalPERS' other PPO, PERSChoice, could rise by up to 18.5 percent.

The overall premium increases are substantially lower than the original 31 percent proposed by the health maintenance organizations partly because of the higher fees for emergency room visits and prescription drugs.

Just how much individual members will have to pay depends on the rate negotiated between the worker and his or her employer.

On Tuesday, CalPERS health committee rejected attempts to raise fees on a longer list of services. The original proposal included a $250 fee for each hospital admission and a $100 fee for each outpatient surgery.

The health committee recommended that emergency room visits cost $75 each, but the full board voted 7-5 Wednesday to cap the fee at $50 per visit.

On the Net:

http://www.calpers.ca.gov

http://www.csea.ca.gov

(Copyright 2003 by The Associated Press. All Rights Reserved.)