As you may have heard, CalPERS recently announced that it will increase premiums by 52% in 2021 and by an additional 25% in 2022. This effectively translates into an increase in premiums of up to 90% as they increase over the next 2 years. This is the eighth increase since the introduction of the CalPERS long-term care insurance program in 1995. CalPERS also pointed out that this may not be the last premium increase it will impose. (For more information on increasing premiums, see www.calpers.ca.gov/page/active-members/health-benefits/long-term-care). Since this lawsuit was filed in 2013, more than 16,000 class members have died and actuaries hired by the plaintiffs` lawyer estimate that thousands more will die over the next 4 years. Although the heirs of the class members who die while the case is pending may be entitled to a claim, the amount of such recovery will be significantly less than what is available under the settlement on the basis of legal arguments that may be advanced by CalPERS. The settlement resolves a class action lawsuit for a subset of class action lawsuits that included allegations that CalPERS violated the insurance contract between the plaintiffs and others who purchased a long-term care policy (LTC1 or LTC2) that had automatic inflation protection benefits by increasing the premiums of those class members by 85%. This increase was announced by CalPERS in 2013 and implemented in 2015 and 2016. CalPERS disclaims all liability to members of the Settlement Class and claims that it has not breached the terms of the Insurance Contract and has entered into the settlement solely for the purpose of resolving this dispute. If you participated in the long-term care benefit plan with the California Public Employees` Retirement System (CalPERS), you may have received information by mail about a class action settlement (officially called Holly Wedding, et al. V.

California Public Employees` Retirement System, et al., Case No. BC517444 or „Billing“). The following comment about CalPERS` removal from the proposed resolution of the long-term care class action lawsuit was written by a frequent contributor to our website – Lawrence Grossman, Certified Financial Planner (TM) and calPERS LTC policyholder. The views expressed in the commentary are his own. So far, the CSU-ERFSA has not commented on the latest developments in the long-standing CalPERS LTC class action lawsuit. CalPERS LTC Insurance Crisis BriefingThe $2.7 billion settlement of CalPERS Long-Term Care Insurance (LTC), which was provisionally approved in 2021, collapsed on April 22, 2022. Policyholders who were forced to continue paying premiums last year just to participate in the settlement are now finding that for this game they have nothing more than the options to pay the new 90% premium increase, significantly reduce their benefits or deviate from their policies. This is a financial and health crisis for 120,000 current policyholders, most of whom are elderly, and their families. Many of these policyholders will soon need long-term care services and, although they have been paying premiums for decades, they are now forced to end their coverage or reduce their coverage because they can no longer afford the recent rate increase or have confidence in CalPERS. The trial itself, which is technically limited in many ways, is far from perfect when it comes to solving all the major problems of the CalPERS program.

About half of all policies sold were excluded, many significant rate increases were not taken into account, and highly misleading sales practices were not addressed. While litigation or other settlement negotiations are imminent, it is clear that the legal process alone is not enough to repair all the damage that CalPERS has caused and continues to do with its long-term care program. After seven years in which CalPERS has unjustly and unsuccessfully fought its former insureds in court, it is now essential that our government representatives and election candidates – in CalPERS, in the Assembly and Senate, and in the Governor – move forward with honesty and vision to ensure that issues with CalPERS LTC are resolved fairly. Similarly, it is time for the press to live up to its role in good governance and seriously investigate this crisis. In 2022, in addition to the regular elections for the Assembly and the Senate, there will be elections for the seats on the Board of Directors of CalPERS.