The board of the California Public Employees Retirement System voted 10-1 to exclude 38 high-cost hospitals from CalPERS' statewide HMO network. The move, endorsed by CalPERS' health committee Tuesday, is designed to save the pension fund up to $50 million a year. Thirteen of the hospitals are operated by Sutter Health, Sacramento, with which CalPERS has been locked in a bitter dispute over costs. Five of Sharp HealthCare's seven San Diego hospitals also will be dropped. The board also voted to adopt a regional pricing plan under which CalPERS' beneficiaries in northern California would pay more for coverage than those in southern California, where healthcare costs are up to 40% lower. Otherwise, CalPERS predicted that about 100 government agencies in southern California, representing about 100,000 enrollees, would leave the program in 2005 to seek lower rates locally, a move that would raise premiums statewide by up to 3%. -- by Laura B. Benko
CalPERS approves excluding high-cost hospitals
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.
Recommended for You