California's health plan costs for state employees and retirees are rising at an "unsustainable" rate, state officials said.
In a July 18 news release, CalPERs, the agency that administers pension and health benefits for state employees, published premium increases for the state's health plans in 2024.
Plan costs will rise an average of 10.77 percent. Non-Medicare plan costs will rise by 10.95 percent on average, and Medicare premiums will increase by 9.55 percent.
State employees are offered several options from different carriers. Kaiser Permanente's HMO plan will have the highest premium increase, at 13.07 percent.
"While the Kaiser premium increase impacts half of our Basic members, there are several other high-quality plan choices in our portfolio with lower monthly premiums,"Chief Health Director Don Moulds said in the news release. "We're encouraging members to shop for more affordable health plans during this Open Enrollment season."
CalPERs provides health benefits to more than 1.5 million members.
The increases in basic plan costs are driven by medical inflation, according to the release, while Medicare Advantage premium increases are driven by risk adjustment rate changes taking effect in 2024.
"We continue to experience rising costs in our Basic PPO plans that we know are unsustainable," Mr. Moulds said. "We have been working on numerous strategies to curb future cost increases that will be reflected in our upcoming PPO solicitation later this year."
Several payers have warned of rising medical costs, as members return to care delayed during the pandemic, higher utilization of behavioral health services, and demand for expensive drugs.