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Read Making a Killing

home / healthcare / in the media

The Orange County Register
Apr 17, 2002

by Bernard J. Wolfson and Hanh Quach

CalPERS likely to up premiums;

Health care State employees could pay 25% more next year. Other employers might follow suit.
Health-insurance premiums for public workers throughout the state are headed toward a stunning 25 percent increase next year, after a decision Tuesday by a key committee of the California Public Employees' Retirement System.

CalPERS usually leads the way in health-insurance trends, and an increase of that magnitude is likely to set off alarm bells among employers statewide.

Some analysts and consumer advocates warned that many employers could face even higher premium hikes, since they don't have the negotiating clout of CalPERS -- which will spend nearly $1.8 billion this year covering 1.2 million state and local employees and their families.

Under the proposal, workers covered by CalPERS also face double-digit increases. 'It's definitely bad news for the little guy when the big guy accepts this kind of premium increases,'' said Jamie Court, executive director of the Foundation for Taxpayer and Consumer Rights.

The CalPERS health-benefits committee voted 6-1 Tuesday to accept the bids of five HMOs, with an average premium increase of 25.1 percent -- more than double the statewide average this year.
The organization's 13-member board will vote today on the committee's recommendation, which affects 56,861 people in Orange County.

''While this is the best deal we can get today, it doesn't seem fair that employees are getting a direct hit -- essentially a pay cut,'' said Ted Eliopoulos, California's deputy treasurer.

Contact Wolfson at (714) 796-6977 or

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