Title
Human Resources Department recommending the Board take the following actions regarding Health Plan Programs and Ancillary Employee Benefit Programs for the 2027 Plan Year:
1) Approve the proposed 2027 health plan rate cards (Attachment A) based on the cost sharing of health premiums in the current Memoranda of Understanding with all bargaining units, the Salary and Benefits Resolution for unrepresented employees, and in accordance with the Patient Protection and Affordable Care Act;
2) Authorize the Director of Human Resources, or Assistant Director of Human Resources, to execute administrative health and benefit program plan renewals for services that otherwise fall under existing executed master agreements; and
3) Grant Human Resources the authority to correct any minor clerical errors or adjustments, if necessary, to the approved health plan rate cards for the 2027 health benefits plan year, as needed.
FUNDING: Countywide cost, shared between the County Departments (General Fund and Non-General Fund), employees and participating retirees.
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DISCUSSION / BACKGROUND
Health Plans
On February 15, 2011, with Legistar file 11-0121, the Board of Supervisors entered into a Memorandum of Understanding (MOU) with CSAC-EIA (EIA) to join the CSAC-EIA Health program (EIA Health). In 2020, EIA changed its name to PRISM. PRISM is a Joint Powers Authority (JPA) comprised of California counties, cities, and public agencies organized to jointly develop and fund insurance and related programs with the most favorable terms and costs. As a member of this organization, the County has controlled costs of the health plans offered through PRISM Health.
On August 29, 2023, with Legistar file 23-1481, the Board of Supervisors authorized the Human Resources Director to execute an updated PRISM Health Program MOU which better represented the Health Program structure and requirements of participation, on behalf of the County of El Dorado.
On August 12, 2025, with Legistar file 25-1221, the Board of Supervisors authorized the Human Resources Director to execute a PRISM Health Vision Program MOU to confirm and continue participation in the PRISM Vision Program.
The Board authorized the County to pay Benefit Coordinators Corporation (BCC) for any Third Party Administrator (TPA) services received under the Master Agreement between PRISM and BCC, on July 21, 2020, with Legistar file 20-0949.
For the 2027 plan year, the following health plans are scheduled to renew with a 10.7% rate increase:
Blue Shield PPO 200 Standard
Blue Shield PPO 1750* ABHP Low
Blue Shield PPO 2000 ABHP High (ACA Compliant Plan)
Kaiser HMO Standard
Kaiser 1750* ABHP
*Account Based Health Plan (ABHP) minimum deductibles increased to stay in compliance with Internal Revenue Service (IRS) regulations. Minimum deductibles increased per IRS from $1,700 to $1,750.
Healthcare and pharmacy costs continue to rise due to increased overall utilization, higher baseline medical costs, and a growing number of large claims. Year-over-year utilization has increased by 11.5%, and pharmacy spending is up 26.4%. These trends reflect ongoing pressures such as provider reimbursement increases, labor shortages, inflation, and a higher volume of high-cost claims, all of which contribute to upward movement in plan premiums.
The “Blue Shield PPO 2000 ABHP High” (high deductible) plan is the County’s Affordable Care Act (ACA) compliant plan. The IRS annually sets an ACA “affordability limit,” which represents the maximum share of household income an employee can be required to pay for self-only coverage. For 2027, that affordability limit is 10.22%. On November 5, 2024, with Legistar file 24-1825, the Board approved the County’s use of the Rate of Pay safe harbor to satisfy “affordability” under the ACA. Under the Rate of Pay Safe Harbor, the maximum amount an employer can charge for self-only coverage is the percentage of affordability factor (affordability limit) multiplied by the employees’ lowest hourly rate of pay times 130 hours. To comply with the Rate of Pay Safe Harbor, the County calculates the employee share of premium based on the lowest actual rate of pay among employees who may be eligible for an ACA offer of coverage, which currently is $17.50 per hour. As long as an offer of coverage satisfies an ACA safe harbor, the ACA employer shared responsibility will be met, avoiding penalties.
Retiree Medicare Advantage Supplement Plans
Retirees who are 65 or older are eligible to purchase health plans through UHC and KPSA. For the 2027 plan year, the following retiree Medicare Advantage supplement plans are scheduled to renew as follows:
Kaiser Permanente Senior Advantage (KPSA) 0% increase
UnitedHealthcare (UHC) 16% increase
Industry-wide, Medicare Advantage supplement plans have continued to see larger rate increases the last few years due to the general upward medical cost trend and as a result of Medicare payment adjustments and the Inflation Reduction Act (IRA) of 2022. Medicare’s lower payment rates to insurers (which make the primary Medicare plans more affordable) resulted in significant Medicare Advantage supplement plan rate increases.
Flexible Spending Account (FSA) and Health Savings Account (HSA) Contribution Limits
Health Care Reimbursement Account (HCRA) $3,050*
Dependent Care Reimbursement Account (DCRA) $7,500*
Health Savings Account (HSA) $4,500 individual/$9,000 family
*Contribution limits adjust to stay in compliance with IRS regulations; limits may be subject to change for 2027 should it be required by the IRS.
Ancillary Benefit Programs
Delta Dental 9.1% increase
VSP Vision (All EE’s Except Sheriff) 6.3% increase
VSP Vision (Sheriff Only) 6.4% increase
Lincoln Financial Basic Life Rate guarantee through December 31, 2027
Lincoln Financial Long Term Disability Rate guarantee through December 31, 2027
Concern EAP PRISM 3.1% increase
ConcernPlus EAP PRISM Pending
The annual funding contribution for dental and vision are used to maintain sufficient funds in the self-insured plans, and funds are used to pay submitted claims.
The annual funding contribution serves as the basis for determining monthly “premium” rates. Concern EAP rates, previously adopted by the board on May 19, 2026 (Legistar file 26-0763), are valid through June 30, 2029. The separate “ConcernPlus EAP” gives first responders generally the same benefits otherwise provided through our traditional EAP to eligible employees, including emotional health and substance abuse, parenting and childcare needs, financial coaching, legal consultation, and eldercare resources, while providing law enforcement first responders with specific culturally competent short-term counselors. Both EAP programs have monthly Per Enrolled Participating Member (PEPM) rates, in addition to Critical Incident Stress Debrief (CISD) hours that can be purchased on a fee-for-service (FFS) basis as needed. ConcernPlus EAP rates, previously adopted by the Board on September 16, 2025 (Legistar file 25-1537), are valid through the current plan year ending December 31, 2026. The 2027 ConcernPlus EAP rate has not been received. Because this rate is included on the COBRA rate card, Human Resources recommends adopting the COBRA rate card at this time, excluding the pending ConcenPlus EAP rate, and will return to the Board for adoption of the updated COBRA rate card once the 2027 ConcernPlus EAP rate is received.
OE3 Health Trust Rate Card
The Operating Engineers, Local 3 (OE3) labor organization offers two health plans (Anthem Platinum “Plan A” and Kaiser Platinum “Plan B”) to their members in our Trades and Crafts (TC) and Corrections (CR) bargaining units through its OE3 Health Trust, in addition to what is offered by the County. The County contributes to those plans equal to what is contributed to the comparable County-sponsored health plans.
The OE3 Health Trust has provided the County with their plan rates; the County then applied the County contribution per the applicable Memoranda of Understanding (MOUs) to create the published rate cards for employees.
While the County does not have any responsibility for the OE3 Health Trust health plan or programs, the County does have a responsibility to the Employer and Employee contribution for the applicable OE3 Health Trust plans based on the MOUs with the OE3 represented bargaining units.
The Human Resources Department is requesting the Board review and approve the attached 2027 OE3 Health Trust health rate card for the two plans available to our employees.
Next Steps
Upon Board approval, the next steps will consist of the following:
1. Human Resources will post and distribute renewal plans and corresponding rates to employees and affiliated agencies prior to open enrollment in October 2026, with an effective date of pay period 25 for active employees and December 1, 2026, for all other participants;
2. Human Resources will return to the Board with the 2027 EAP ConcernPlus rate;
3. Human Resources will secure health insurance carriers and other ancillary benefit program contract renewals; and
4. The Director of Human Resources, or Assistant Director of Human Resources, will sign health and other ancillary benefit contracts for services that otherwise fall under existing executed master agreements.
ALTERNATIVES
The Board could choose to override the recommendation to renew the 2027 Employee Benefits Insurance Program Renewal as recommended; however, if the Board chooses not to approve the recommendations as listed herein, the County will not meet the deadlines required by the vendors for the plan year.
Regarding the 2027 OE3 rate card, because the County offers the two OE3 Trust health plans and makes County Contributions pursuant to the terms of the negotiated MOUs with OE3 represented bargaining units, there is no recommended alternative.
There is no recommended alternative for the “Blue Shield PPO 2000 ABHP High” plan, as this is the plan which complies with the provisions for affordability under the ACA.
PRIOR BOARD ACTION
02/15/2011 Legistar file 11-0121: County joined CSAC-EIA Health program (now PRISM Health).
07/21/2020 Legistar file 20-0949: BCC approved as County’s third-party benefits administrator under PRISM Health.
08/29/2023 Legistar file 23-1481: Board authorized HR Director to execute an updated PRISM Health Program MOU.
11/05/2024 Legistar file 24-1825: Board approved County’s use of the Rate of Pay safe harbor to satisfy “affordability” under the ACA.
08/12/2025 Legistar file 25-1221: Board authorized HR Director to execute a PRISM Vision Program MOU.
09/16/2025 Legistar file 25-1537: Board adopted 2026 health and ancillary benefit renewals
05/19/2026 Legistar file 26-0763: Board approved updated 2026 COBRA health plan rate
OTHER DEPARTMENT / AGENCY INVOLVEMENT
N/A
CAO RECOMMENDATION / COMMENTS
Approve as recommended.
FINANCIAL IMPACT
The total percentage change from the 2026 rates is 10.5%. The overall increase in annual premium from last year is approximately $4,687,291 for all listed benefit programs and ancillary benefits including long term disability and life insurance. Costs are shared between employees and salary and benefits budgets for each County department. It is anticipated that most departments can cover the six months of increased costs with Salaries and Benefits savings from vacancies. Departments will assess these costs with the mid-year budget report and request a budget transfer to address any increases that cannot be covered with savings.
CLERK OF THE BOARD FOLLOW UP ACTIONS
N/A
STRATEGIC PLAN COMPONENT
Workforce Excellence
Priority: Focus on Employee Development & Well-Being
Action Item: Continue to implement wellness initiatives and activities for El Dorado County employees
CONTACT
Joseph Carruesco, Director of Human Resources