Health Care Premium Increase

$91​2,000​​​​​​

The California Public Employees' Retirement System (CalPERS) administers CSU employee health care benefits. Health care premiums are shared between the CSU and its employees, with the CSU funding a significant portion of the costs. The 2017-18 CSU budget plan includes $0.9 million to fund the base increase in employer-paid health care costs resulting from changes in premiums effective January 2017. The following chart indicates the Government Code (employer-paid) health care contribution increases from 2013 through 2017:​

Government Code Health Care Monthly Employer Contribution Rates​

​Eligible Dependents ​ ​2013 ​ ​2014 ​ ​2​​015 ​ ​2016 ​ ​2​017 ​ ​Five-Y​ear Increase ​
​ % ​$
​Employee Only​$622​$642​$655​$705​$707​13.7%​$85
​Employee + 1 dependent$1,183​​$1,218​$1,246​$1,343​$1,349​14.0%​$166
​Employee + 2 or more$1,515​​$1,559​$1,605​$1,727​$1,727​14.0%​$1,212

 

The CSU is governed by Government Code Section 22871 that defines the way employer-paid health care contribution rates are calculated. Either through policy or collective bargaining agreement, the CSU covers health care costs for represented and non-represented employees up to an amount equivalent to the established Government Code rates, with the exception of Unit 6 (Skilled Crafts), which bargained for CSU employer health contribution rates slightly above Government Code rates.

The total increase in CSU health care costs due to contribution changes during this five-year period is more than $95 milli​on.

5-Year Increase in Health Care Costs

Calend​ar Year
(Contract Period)​
Government Code Health​ 
(Employer-Paid Budget Increase)
CSU Annualized Health Care
Budget Increase​
20139.8%$36,226,000
20143.0%12,066,000
20152.6%11,040,000
20167.7%35,080,000
20170.2%912,000
5-Year Increase in CSU Health Care Cos​ts:$95,324,000

​ 

The 2017-18 budget request funds permanent base budget costs associated with January 2017 employer health care premium increases. The CSU must absorb approximately $0.5 million during 2016-17 to fund the one-time costs related to the January 2017 premium increases for the six-month period from January to June 2017.​