PEBP board keeps HMO/EPO options for 2026 after weeks of public outcry; authorizes HMO contract talks
January 25, 2025 | Public Employees Benefits Program Board Meeting, Executive Agencies, Organizations, Executive, Nevada
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The Public Employees Benefits Program (PEBP) board voted Jan. 23 to continue offering the HMO/EPO option through plan year 2026 and authorized Executive Officer Celestina Glover to negotiate and sign a contract with the recommended HMO vendor for southern Nevada.
The board’s action followed more than two hours of public comment by state employees, faculty and retirees who said eliminating the HMO or converting the low-deductible PPO to a higher-deductible PPO would disrupt care, raise out-of-pocket costs and risk patients losing long-term providers. Many callers also described billing and prior-authorization problems they said they experienced under the current third-party administrator, UMR, and urged the board to replace or rein in that vendor and to preserve the HMO option.
Why it matters: The HMO and EPO plans have lower member cost-sharing for many services and are widely used by state university and other public employees in southern Nevada. Board staff and consultant materials showed the HMO/EPO are the most expensive options by premium, and staff had presented data and an RFP process intended to secure network continuity; the board’s decision preserves choice for members while staff negotiates a replacement HMO contract for the South.
Board and staff rationale
Executive Officer Celestina Glover told the board PEBP had analyzed utilization, premium and network data and had released an RFP to create a secondary network that would include Carson Tahoe Health. “We are looking at trying to make the transition, should the board approve it, as smooth as possible, and we are taking into consideration the concerns that our members have,” she said, adding the current HMO contract expires June 30, 2025 and that the RFP results for the HMO vendor must be discussed in closed session before any award.
Consultant Richard Ward of Segal (presentation referred to in public materials) reviewed plan designs and modeled two replacement PPO options and projected multi-year costs. Ward told the board that on actuarial-value and total-cost measures the low-deductible PPO (as currently designed) remained the most efficient self-funded option, and that sunsetting the HMO/EPO would likely push some higher-cost members into the PPO, increasing that plan’s premiums. He also reported network-access comparisons showing the majority of hospitals, primary-care providers and specialists used by HMO members are available in the broader PPO network; he said only a small number of members would see disruption unless those specific providers declined to join the PPO network.
Public commenters and provider problems
More than two dozen public speakers described why they rely on the HMO. Many were university faculty and staff from the Nevada System of Higher Education (NSHE): Stephanie Goodman (University Regent, Nevada System of Higher Education), Minnie Wood (UNLV faculty and nurse practitioner), Doug Unger (acting president, UNLV chapter of Nevada Faculty Alliance), Deborah Arteaga (UNLV Faculty Senate chair) and others urged the board to retain the HMO.
Several callers reported claim denials or prior-authorization failures involving UMR and Carson Tahoe Health. Jennifer Carr, a state employee, said her daughter Lindsey Carr (a 23-year-old graduate student and cancer survivor) faced denials for cancer treatments and that Carson Tahoe’s preauthorization unit had escalated dozens of similar cases; Lindsey Carr also spoke and said she would lose access to her cancer-care team if those provider relationships with UMR were not repaired. Claudia Cidillo (administrative assistant, UNLV) and others described repeated billing and coding problems they attributed to UMR that caused delays and unexpected bills.
Board deliberations and vote
Board member Michelle Kelly, the NSHE South representative, summarized the volume of public comment she had received and said she was not in favor of sunsetting the EPO/HMO this year: “I am not in favor of sunsetting the EPO HMO this year,” she said. Several other board members, including Stacy Weeks and Jim Barnes, said they supported delaying any change until after the legislative session and until the results of the HMO RFP were finalized. Glover reminded the board that a decision was needed in time to set rates for the next plan year and that, if the board directed staff to proceed with an award, the executive officer must be authorized to finalize and sign the contract so it could be submitted to the Board of Examiners.
Following discussion, the board approved a motion to continue offering the HMO/EPO through plan year 2026, contingent on a viable contract being negotiated with the recommended HMO vendor, and gave the executive officer authority to complete negotiations and sign the contract. The board then approved, in a separate vote, staff’s recommendation to begin negotiations with the selected bidder for a southern Nevada fully insured HMO contract (the RFP results had been reviewed in closed session). The motions were seconded and carried by voice vote.
What the vote does and does not do
The board’s action keeps HMO/EPO coverage available to members for plan year 2026 and directs staff to finalize a fully insured HMO contract for southern Nevada if negotiations are successful. It does not yet change the overall PPO plan designs or finalize any replacement PPO option; Segal/Staff had presented two possible PPO designs (one with no deductible and one with a $500 deductible) for consideration if sunsetting were pursued in future years. The board also did not adopt any immediate vendor removal for UMR at this meeting; several commenters urged replacing UMR or improving its claims handling, and staff and auditors reported ongoing remediation activity for UMR’s performance guarantees.
Next steps
- Staff will complete negotiation and, if successful, execute a contract with the selected HMO vendor for southern Nevada and present required materials to the Board of Examiners.
- The board directed staff to proceed with rate-setting so that plan year 2026 premiums can be published in time for open enrollment; the decision may be revisited in future meetings depending on legislative outcomes or further RFP results.
- PEBP staff also said they will continue outreach to members and providers and implement transition steps for any members whose providers may not be in the selected network.
Quotes
“This news that I might be thrown off of my HMO and replaced with a PPO is the worst news I have received since becoming an employee at UNLV. I’m absolutely terrified what will happen,” said Timothy Hoft, a longtime UNLV faculty member, during public comment.
“Do the right thing. Keep the HMO, EPO, and do not convert the low deductible PPO to option 2,” said Deborah Arteaga, chair of the UNLV Faculty Senate, summarizing written and oral comments she had received from colleagues.
“We are looking at trying to make the transition, should the board approve it, as smooth as possible, and we are taking into consideration the concerns that our members have,” Executive Officer Celestina Glover said during the board discussion.
Ending
The board’s decision preserves HMO/EPO choice for plan year 2026 while directing staff to finalize a southern Nevada HMO contract and to continue the rate-setting and vendor oversight work needed ahead of open enrollment. Members who spoke during public comment said they plan continued engagement with the board and the Legislature if plan offerings are revised in future years.
The board’s action followed more than two hours of public comment by state employees, faculty and retirees who said eliminating the HMO or converting the low-deductible PPO to a higher-deductible PPO would disrupt care, raise out-of-pocket costs and risk patients losing long-term providers. Many callers also described billing and prior-authorization problems they said they experienced under the current third-party administrator, UMR, and urged the board to replace or rein in that vendor and to preserve the HMO option.
Why it matters: The HMO and EPO plans have lower member cost-sharing for many services and are widely used by state university and other public employees in southern Nevada. Board staff and consultant materials showed the HMO/EPO are the most expensive options by premium, and staff had presented data and an RFP process intended to secure network continuity; the board’s decision preserves choice for members while staff negotiates a replacement HMO contract for the South.
Board and staff rationale
Executive Officer Celestina Glover told the board PEBP had analyzed utilization, premium and network data and had released an RFP to create a secondary network that would include Carson Tahoe Health. “We are looking at trying to make the transition, should the board approve it, as smooth as possible, and we are taking into consideration the concerns that our members have,” she said, adding the current HMO contract expires June 30, 2025 and that the RFP results for the HMO vendor must be discussed in closed session before any award.
Consultant Richard Ward of Segal (presentation referred to in public materials) reviewed plan designs and modeled two replacement PPO options and projected multi-year costs. Ward told the board that on actuarial-value and total-cost measures the low-deductible PPO (as currently designed) remained the most efficient self-funded option, and that sunsetting the HMO/EPO would likely push some higher-cost members into the PPO, increasing that plan’s premiums. He also reported network-access comparisons showing the majority of hospitals, primary-care providers and specialists used by HMO members are available in the broader PPO network; he said only a small number of members would see disruption unless those specific providers declined to join the PPO network.
Public commenters and provider problems
More than two dozen public speakers described why they rely on the HMO. Many were university faculty and staff from the Nevada System of Higher Education (NSHE): Stephanie Goodman (University Regent, Nevada System of Higher Education), Minnie Wood (UNLV faculty and nurse practitioner), Doug Unger (acting president, UNLV chapter of Nevada Faculty Alliance), Deborah Arteaga (UNLV Faculty Senate chair) and others urged the board to retain the HMO.
Several callers reported claim denials or prior-authorization failures involving UMR and Carson Tahoe Health. Jennifer Carr, a state employee, said her daughter Lindsey Carr (a 23-year-old graduate student and cancer survivor) faced denials for cancer treatments and that Carson Tahoe’s preauthorization unit had escalated dozens of similar cases; Lindsey Carr also spoke and said she would lose access to her cancer-care team if those provider relationships with UMR were not repaired. Claudia Cidillo (administrative assistant, UNLV) and others described repeated billing and coding problems they attributed to UMR that caused delays and unexpected bills.
Board deliberations and vote
Board member Michelle Kelly, the NSHE South representative, summarized the volume of public comment she had received and said she was not in favor of sunsetting the EPO/HMO this year: “I am not in favor of sunsetting the EPO HMO this year,” she said. Several other board members, including Stacy Weeks and Jim Barnes, said they supported delaying any change until after the legislative session and until the results of the HMO RFP were finalized. Glover reminded the board that a decision was needed in time to set rates for the next plan year and that, if the board directed staff to proceed with an award, the executive officer must be authorized to finalize and sign the contract so it could be submitted to the Board of Examiners.
Following discussion, the board approved a motion to continue offering the HMO/EPO through plan year 2026, contingent on a viable contract being negotiated with the recommended HMO vendor, and gave the executive officer authority to complete negotiations and sign the contract. The board then approved, in a separate vote, staff’s recommendation to begin negotiations with the selected bidder for a southern Nevada fully insured HMO contract (the RFP results had been reviewed in closed session). The motions were seconded and carried by voice vote.
What the vote does and does not do
The board’s action keeps HMO/EPO coverage available to members for plan year 2026 and directs staff to finalize a fully insured HMO contract for southern Nevada if negotiations are successful. It does not yet change the overall PPO plan designs or finalize any replacement PPO option; Segal/Staff had presented two possible PPO designs (one with no deductible and one with a $500 deductible) for consideration if sunsetting were pursued in future years. The board also did not adopt any immediate vendor removal for UMR at this meeting; several commenters urged replacing UMR or improving its claims handling, and staff and auditors reported ongoing remediation activity for UMR’s performance guarantees.
Next steps
- Staff will complete negotiation and, if successful, execute a contract with the selected HMO vendor for southern Nevada and present required materials to the Board of Examiners.
- The board directed staff to proceed with rate-setting so that plan year 2026 premiums can be published in time for open enrollment; the decision may be revisited in future meetings depending on legislative outcomes or further RFP results.
- PEBP staff also said they will continue outreach to members and providers and implement transition steps for any members whose providers may not be in the selected network.
Quotes
“This news that I might be thrown off of my HMO and replaced with a PPO is the worst news I have received since becoming an employee at UNLV. I’m absolutely terrified what will happen,” said Timothy Hoft, a longtime UNLV faculty member, during public comment.
“Do the right thing. Keep the HMO, EPO, and do not convert the low deductible PPO to option 2,” said Deborah Arteaga, chair of the UNLV Faculty Senate, summarizing written and oral comments she had received from colleagues.
“We are looking at trying to make the transition, should the board approve it, as smooth as possible, and we are taking into consideration the concerns that our members have,” Executive Officer Celestina Glover said during the board discussion.
Ending
The board’s decision preserves HMO/EPO choice for plan year 2026 while directing staff to finalize a southern Nevada HMO contract and to continue the rate-setting and vendor oversight work needed ahead of open enrollment. Members who spoke during public comment said they plan continued engagement with the board and the Legislature if plan offerings are revised in future years.
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