The CalPERS Board of Administration meets several times a year to discuss and make decisions on investment, health, and retirement benefits issues and policies to ensure a sustainable pension system and health care program for members.
Here are some highlights from the meeting, held Nov. 13 to 15, 2023, in Sacramento.
$100 Billion Net Zero Pledge Announced
CalPERS announced a sweeping sustainable investing strategy to accelerate moving the fund’s portfolio toward net zero, where carbon emissions from investments are evenly balanced with carbon reductions. The new effort will commit $100 billion toward climate solutions by 2030 and ensure corporate accountability through the sale of some investments that do not have a credible plan to reduce carbon emissions.
Peter Cashion, CalPERS Sustainable Investments Managing Director, presented the CalPERS Sustainable Investments 2030 Strategy to the Investment Committee. For more information, access the agenda item (PDF), the presentation (PDF), and Mercer’s review of CalPERS’ Net Zero plan (PDF). You can also view our announcement on the $100 billion net zero pledge and new climate accountability measures.
Health Care Plans to Expand Service Areas, Plus Doulas and Travel Benefits on the Horizon
The board approved Health Benefits Program proposals that would take effect in 2025. The proposals include expanding service areas for several CalPERS health care plans, as well as a doula benefit for all pregnant and postpartum members, and a travel benefit for medically necessary care.
Health Plan Research and Administration Division Chief Rob Jarzombek and Chief Clinical Director Dr. Julia Logan presented the action item. Changes to health care plans’ service areas are pending approval from the Department of Managed Health Care in some cases, and include:
- Blue Shield Trio – the service area will expand into Contra Costa County and the Redding area in Shasta County. This makes for the first HMO plan available to CalPERS members in Shasta County in recent memory, Jarzombek noted.
- Health Net Salud y Más – the service area will expand into Imperial County, which is adjacent to San Diego County on the U.S.-Mexico border. Currently Health Net Salud y Más covers several counties in Southern California.
- Kaiser Permanente Basic – the service area will partially expand into the northern portion of Monterey County, and cover the cities of Salinas, Watsonville, and Monterey.
- UnitedHealthcare SignatureValue Harmony – the service area will expand into Contra Costa, Napa, and Solano counties. These partial and full county expansions are on top of moving into Santa Clara and Santa Cruz counties in 2024, Jarzombek noted.
- Western Health Advantage Basic – the service area will expand into Fresno, Kings, and Madera counties.
Dr. Logan presented the benefit design changes, including a doula benefit for all pregnant and postpartum health plan members that belong to an HMO or PPO plan.
Dr. Logan also presented the travel benefit for medically necessary care, which standardizes the coverage of travel and lodging expenses for eligible, medically necessary care that cannot be accessed within 50 miles of a member’s residence for Basic and Medicare members. Examples of medically necessary care include, but are not limited to, abortion services, gender-affirming care, complex surgeries, and cancer care.
Annual Review of Funding Levels and Risk Report
Scott Terando and Randall Dziubek of the Actuarial Office presented this annual report, which provides a comprehensive summary of the current funding levels of the system and the near-term outlook for required contributions as of June 30, 2022, projected forward to June 30, 2023.
Factors such as investment losses for the year ending June 30, 2022, continued high inflation, and potentially unfavorable near-term economic conditions may result in CalPERS employers experiencing difficulty making required near-term contributions, particularly if those required contributions increase due to any of these factors, the report notes.