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Board approves Kaiser California and multi-region 2026 rates after debate; move to discontinue multi-region plans fails
Summary
The Health Service Board approved Kaiser Permanente California HMO rate increases for plan year 2026 and, after rejecting a staff recommendation to discontinue Kaiser multi-region retiree HMOs, approved multi-region 2026 rate cards. The board debated member impacts, administrative costs and outreach for affected retirees.
The San Francisco Health Service Board on June 12 approved Kaiser Permanente plan renewals for plan year 2026, including rate increases for active employees and retirees, and after a contested vote rejected a staff recommendation to discontinue Kaiser multi-region retiree HMOs for members living in Washington, Oregon and Hawaii. The board then approved the multi-region 2026 rate cards.
What the board approved - Kaiser California HMO (actives and non-Medicare retirees): staff recommended a 9.88% insured premium increase from 2025 to 2026; the board approved the 2026 rate cards as presented. - Kaiser California Medicare retirees (Kaiser Permanente Senior Advantage, KPSA): staff recommended a 9.33% insured premium increase from 2025 to 2026; the board approved the KPSA 2026 rate cards as presented. - Kaiser multi-region retiree HMOs (Washington, Oregon, Hawaii): the board voted down a staff recommendation to discontinue the multi-region plans after 2025 (the motion to discontinue failed by roll call). Because the board rejected discontinuation, the board then reviewed and approved the 2026 rate cards for the Kaiser multi-region HMOs.
Why the board debated the multi-region plans - Staff rationale to discontinue: SFHSS staff and their actuary (Aon) said the multi-region plans have persistently low enrollment, add administrative complexity and fragmentation, and prevent development of a blended rate. Staff noted the administrative cost to administer multi-region plans was materially higher per member than the larger Kaiser California block and that staffing constraints made continued administration costly. - Public commenters and retiree groups pushed back, saying the multi-region plans provide an earned benefit and better local access in some areas (commenters noted gym/wellness access and local provider networks) and urged the board to keep the options available to retirees who moved out of state after living and working in San Francisco.
Votes and outcomes (summary) - Motion to discontinue Kaiser multi-region HMOs (staff recommendation): motion failed on roll call. Reopened vote recorded 4 no / 2 yes (President Howe and Commissioner Wilson voted yes; the remaining four commissioners voted no). Because discontinuation failed, item 17 (the multi-region 2026 rate cards) was brought forward and approved by roll call (unanimous ayes recorded). - Kaiser California HMO and KPSA rate approvals: motions to approve the respective 2026 rate cards passed on roll call.
Member impact and outreach - Staff and the actuary described the non-Medicare national PPO plan and the MAPD PPO plan (Blue Shield) that are available to retirees living outside Kaiser service areas. Staff emphasized they would use postcards, letters, outbound calls and a dedicated SFHSS phone-queue to help affected members if plans were discontinued; after the board decided to retain the multi-region plans, staff nevertheless committed to continued outreach and support for members in those regions.
Authorities and technical notes - The staff and actuary cited the city charter's framework for retiree employer contributions and the 10-county survey used to set retiree contribution baselines. The actuary also noted a small projected cost component (about 0.5%) tied to compliance with state infertility coverage requirements (SB 729), which plays a small role in the overall Kaiser renewal.
Ending note The board's decision preserves the multi-region Kaiser options for 2026 while approving rate increases across Kaiser products that SFHSS staff said are driven by national health cost trends and Kaiser's plan experience. The board directed staff to continue active member outreach and to provide clear communications about how the changes affect retirees in and outside California.
