MARTINEZ — Concerned by the thousands of Contra Costa County residents expected to soon be kicked off of Medicare, county leadership has decided to redirect a $10 million subsidy away from one of its employee healthcare plans, spiking premiums for some county employees.
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On Tuesday, supervisors approved healthcare premium hikes of about 73% and 39.5% for staff and retirees covered under two county healthcare options, known as Plan A and Plan B. The decision made Tuesday impacts about 500 active employees and 1,200 retirees.
In emotional testimony, employees implored the board to reject the premium changes that would now charge between $656 and $2,718 monthly depending on plan selection and number of people covered.
The county offers other healthcare packages, some of which require no employee contribution, but employees covered under the two affected plans argued the change will force them to abandon their existing providers.
Contra Costa County has already committed to a one-year subsidy for another 500 employees who were able to negotiate that agreement during bargaining, staff noted. Some public sector workers are now asking to be treated similarly.
“We’re not asking for better or different healthcare,” said LaTosha Stockholm, a county employee who said her premiums will nearly double, reaching $2,471, under this changed policy.
“We’re asking to keep the healthcare we already have. You’ve found a way to protect some county employees from this increase and I’m asking you today, please find a way to protect us too.”
County Health Executive Director Grant Colfax acknowledged that the premium changes will be “very disruptive” for those who rely on the plans, but argued the plans were not fiscally sustainable without increasing rates.
Beyond what the county is required to pay toward Plans A and B as the employer, Colfax said the plans have been subsidized by tens of millions of dollars. Meanwhile, the system faces a budget deficit of about $700 million over the next five years, he noted.
“Contra Costa Health, overall, including our hospitals and our clinics, is facing a deficit of magnitudes we have never seen before,” Colfax said.
“So in keeping with the mission of Contra Costa Health, to provide services for all people in Contra Costa, including, especially, the most vulnerable, and to ensure that we can keep doing that over these next years, it is imperative for the sustainability of the commercial health plan that these rates are increased.”
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County officials have largely blamed the anticipated shortage on a state budget deficit and $1 trillion in federal cuts to Medicaid approved by Congressional Republicans under the “Big Beautiful Bill.”
Looking to raise additional funds to support the health system, supervisors placed Measure B, a 0.625% general retail tax, on the June ballot. The measure was expected to raise about $150 million annually, but was shot down by voters.
The measure was not expected to cover the entire gap, and supervisors acknowledged a need to reduce spending in general to keep the system’s budget balanced.
The health director also noted that with the failure of Measure B, the cuts now being proposed are meant to ensure funds can be used to provide healthcare to the 47,000 to 50,000 residents who are expected to lose Medicare coverage in January. Additionally, there could be even worse outcomes.
“If we continue on the paths that we’re currently home without action, the state could shut the plan down,” Colfax said. “They have the power to do that.”
Sympathetic to how abrupt the rate hikes will be for those impacted, supervisors John Gioia and Shanelle Scales-Preston said labor groups and the county should negotiate the terms.
Both lawmakers also questioned whether a smaller increase could be implemented now, softening the blow.
Their suggestions were ultimately dismissed, with Chair Diane Burgis, Vice Chair Ken Carlson and Supervisor Candace Anderson voting in favor of the staff-recommended rate increases.
“We are now in a crisis,” Anderson said during the Tuesday meeting.
“It’s a tough decision, but at some point, we have to reconcile as elected officials that we can’t do everything, and we’ve got to ensure that we cover the very critical services that we need to provide, and that we find a way to fill the gap of what we are facing in health.”
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