CalPERS Health Premiums to Increase in 2023
June 16, 2022
This week, the California Public Employees’ Retirement System (CalPERS) Pension and Health Benefits Committee received an update on the Rate Development Process and the 2023 proposed premiums for the CalPERS health plans. The preliminary premiums reflect an average increase of 6.8 percent but vary widely by plan, with two popular PPO plans increasing substantially more. The proposed increases are largely due to rising medical costs.
CalPERS participates in the Rate Development Process each year, during which the Board considers new health plans, expansions of existing health plans, and benefit design changes. Health carriers submitted their initial premiums to CalPERS earlier this year and met with the CalPERS rates team to discuss data, assumptions, and models used to calculate the proposed premiums. The final 2023 premiums, which will go into effect January 1, 2023, may change slightly before final adoption by the Board on July 12.
While employees and employers will see increased premiums on average, the actual increase or decrease will vary based on plans. The impact on counties and other agencies that contract with CalPERS for health plans will be determined by the negotiated health premium contribution amount of each agency.