Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Benefits Administration topic
No spam. Unsubscribe anytime.
Board reviews 2025 rates and benefits calendar and methodology for setting health plan rates
Summary
Aon presented the 2025 rates and benefits calendar and an education session on how SFHSS sets rates for self‑funded, flex‑funded and fully insured plans. The process includes a March actuarial review, a 10‑county benchmarking survey and Board of Supervisors review in July, with open enrollment materials mailed in September.
The Health Service Board received an overview on Jan. 8 of the 2025 rates and benefits calendar and a refresher on the SFHSS rate‑setting methodology from Mike Clark, lead actuary at Aon.
Clark walked the board through the annual cycle: actuarial experience reviews and incurred‑but‑not‑reported and contingency reserve approvals begin in January; March presentations include the 10‑county benchmarking survey (used to set minimum employer contributions), experience trends and proposed plan changes; April–June include plan‑level rate proposals and the board’s approvals; July brings Board of Supervisors review (first and second readings required by charter), and plan renewal confirmations and system programming lead into the September mailing and October open enrollment. Clark said contract RFPs or RFIs for major vendors usually run on a schedule that aligns with the annual renewal but may be presented in late summer for competitive procurements.
The education portion reviewed how SFHSS projects total costs for self‑funded and flex‑funded plans: start with prior‑period claims, apply healthcare trend to project costs, account for plan‑design and headcount changes, add administrative fees and SFHSS‑specific elements (for example, the health‑sustainability charge). For flex‑funded HMOs, Clark said capitation and large‑claim pooling adjustments are built into the projections. He described how projected plan totals are allocated across single, two‑party and family tiers and then segmented into employer and employee contributions based on negotiated MOUs, 10‑county contribution rules and the charter formula for retirees.
Clark also summarized prior rate‑setting changes, including adjustments made since 2018 to address PPO sustainability and to accommodate members living where HMO choices are not available. He said SFHSS continues to monitor PPO enrollment and cost trends and will present specific rate proposals to the board in the March–June cycle.
No vote was required; board members asked follow‑up questions about retiree contribution formulas and the relationship between tiers. Clark and staff said more detailed plan‑level proposals and actuarial backup will be presented in March and April.
