CalPERS Adopts 2012 Rate Package for Health Care Benefits

Package includes overall 4.1 percent annual premium increase
The California Public Employees’ Retirement System on Wednesday adopted its 2012 health care rate package, which includes an overall 4.1 percent annual premium increase. The rates will take effect for the 2012 calendar year beginning next January 1.

The package expands CalPERS PPOs’ value-based purchasing design program for hip and knee replacements, which will now include arthroscopies, colonoscopies and cataract surgery performed in certain centers. The 2012 rate projections also include the application of a portion of the PPO plans’ excess reserves to mitigate the anticipated Early Retiree Reinsurance Program funds for coverage of early retirees under the federal health care reform law, as well as 2012 PPO plan rate increases and proposed pharmacy and benefit changes. PPO Basic plan rates will rise by 1.9 percent for PERS Choice, 15.1 percent for PERSCare and decline by 1.1 percent for PERS Select. 

For HMO Basic plan members, rates will rise by seven percent for Kaiser and 3.5 percent for Blue Shield Access+ and NetValue.

Local Workforce Investment Boards

SB 776 (DeSaulnier) – Oppose
As Amended on June 15, 2011

SB 776, by Senator Mark DeSaulnier, would require local workforce investment boards (WIBs) to spend at a certain percentage of funds provided under the Workforce Investment Act on workforce training programs and supportive services for persons enrolled in training. The phased-in percentage requirement would be as follows:

• Beginning in 2012, at least 20 percent.
• Beginning in 2014, at least 30 percent.
• Beginning in 2016, at least 40 percent.

Additionally, SB 776 requires a local workforce investment area that does not meet the requirements to submit a corrective action plan to the Employment Development Department that provides reasons for not meeting the requirements and describes actions taken to address the identified expenditure deficiencies. The local workforce investment must then provide a corrective action plan to the Employment Development Department within 90 days.

Current law authorizes local WIBs to set local policies and allocate such resources in response to local markets to help the unemployed and underemployed obtain and retain employment. CSAC opposes SB 776 as it would eliminate the authority of local workforce investment boards to determine how to best serve their residents.

SB 776 will be heard in the Senate Labor and Industrial Relations Committee on June 22.

Employee Rights

AB 22 (Mendoza) – Oppose
As Amended on May 12, 2011

AB 22, by Assembly Member Tony Mendoza, would prohibit prospective employers from using consumer credit reports for employment purposes unless the following criteria are met:

• The information in the credit report is substantially job-related (i.e., the applicant has access to money, trade secrets or confidential information.
• The position is managerial, a position in the state Department of Justice, a sworn peace officer or other law enforcement position.
• The credit report is required by law.

The previous version of AB 22 exempted positions in a city or county, but recent amendments removed this exemption. CSAC has taken an Oppose Unless Amended position and has requested the author place the exemption back into the bill as the provisions of the bill would place an unnecessary burden on county employers, especially those who handle confidential personal and financial information.

AB 22 will be heard in the Senate Labor and Industrial Relations Committee on June 22.

AB 325 (Lowenthal) – Oppose
As Amended on June 14, 2011

Assembly Bill 325, by Assembly Member Bonnie Lowenthal, would provide employees (including temporary, seasonal and part-time) a right of up to four days of unpaid bereavement leave for the death of a spouse, child, parent, sibling, grandparent, grandchild, or domestic partner with a 13-month time allotment to complete the leave allowance.

AB 325 would pose a problem for In-Home Supportive Services employees who do not work a traditional scheduled work week and because of the guarantee that bereavement leave can be used for up to 13 months, which is not typical of current leave policies and has the potential to conflict with policies for employees already receiving bereavement leave.

AB 325 will be heard in the Senate Labor and Industrial Relations Committee on June 22.

Workers’ Compensation

AB 335 (Solorio) – Support
As Amended on May 27, 2011

AB 335, by Assembly Member Jose Solorio, would implement recommendations from the Commission on Health and Safety and Workers’ Compensation (CHSWC) related to mandatory workers’ compensation benefits notices.

In July 2010, CHSWC released its Report on Benefit Notices and Recommendations (Report), a culmination of work performed by a broad stakeholder group convened to examine ways of improving workers’ compensation benefit notices. The Report put forth recommendations and the necessary legislative steps to implement them. 

AB 335 would require the Administrative Director for the Division of Workers’ Compensation to work with CHSWC to develop new benefit notices that are sent by employers to injured workers; the notices must be written in easily understandable language. 

AB 335 will be heard in the Senate Labor and Industrial Relations Committee on June 22.

AB 375 (Skinner) – Oppose
As Amended on May 27, 2011

AB 375, by Assembly Member Nancy Skinner, would establish a presumption for workers’ compensation purposes when a hospital employee contracts a blood-borne infectious disease or methicillin-resistant Staphylococcus aureus (MRSA) infection.

AB 375 would also extend this presumption six months after the employee’s service has been terminated in the case a blood-borne illness is contracted and three months after termination of service in the case of neck or back impairment or the contraction of MRSA.

CSAC opposes AB 375 because employers need to retain the discretion to accept or challenge workers’ compensation claims. Further, AB 375 could result in increased costs in workers’ compensation for county hospitals at a time when counties are facing budget deficits and reduced funding for program services.

AB 375 will be heard in the Senate Labor and Industrial Relations Committee on June 22.

SB 457 (Calderon) – Oppose
As Amended on May 4, 2011

SB 457, by Senator Ron Calderon, would require the Workers’ Compensation Appeals Board (Board) to determine, on the basis of liens filed, reimbursement for benefits paid or services provided by a health care service plan, a group disability policy, a hospital service contract, or a self-insured employee welfare benefit plan, notwithstanding the Official Medical Fee Schedule (OFMS), when an award is made for reimbursement for self-procured medical costs for the effects of an injury or illness arising out of and in the course of employment. SB 457 would provide that its provisions are not to be deemed as modifying in any way the rights of any health care provider to file and prosecute a lien.

SB 457 will be heard in the Assembly Insurance Committee on June 22.

Collective Bargaining

SB 931 (Vargas) – Oppose
As Amended on April 25, 2011

SB 931, by Senator Juan Vargas, would provide that all public agencies are forbidden to use taxpayer dollars to pay for outside consultants or legal advisors for the purpose of counseling the public employer about ways to minimize or deter the exercise of public employee union activities. 

SB 931 states that these provisions would not apply to payments for representation of a public sector employer before any court, administrative agency, or tribunal of arbitration, or for payments for engaging in collective bargaining on behalf of the employer with respect to wages, hours, or other terms and conditions of employment. However, the bill substantially interferes with public agencies’ attorney-client privilege and unreasonably limits their legal counsel.

SB 931 will be heard in the Senate Labor and Industrial Relations on June 22.