Board approves distribution of remaining Sutter settlement dollars to buy down 2025 rates

The Health Service Board unanimously approved applying the last of the Sutter legal settlement funds to reduce 2025 plan rates.

Aon actuary Mike Clark told the board SFHSS received a final payout of $2,228,280 on July 5, 2023, and recommended annualizing and allocating $1,916,321 to Blue Shield Access Plus/Trio HMO and aligned UnitedHealthcare EPO plans and $311,959 to the non‑Medicare PPO. Clark said SFHSS believes these are the final payments from that settlement; if additional settlement dollars arrive, staff will handle them in future rating cycles.

"The funds paid were just slightly more than the original remaining 2,000,000 expectation. It was $2,228,280 to be precise, received by SFHS on 07/05/2023," Clark said. "We're looking at 1,916,321 to be distributed within the HMO and EPO plans, and 311,959 to be distributed into the non‑Medicare PPO plan."

Board members moved and seconded the recommendation and approved it by unanimous roll call. Staff said the buy‑down amounts will be reflected in the rate cards presented for approval in May.

The board's action follows adoption earlier in the meeting of contingency‑reserve modifications; staff said the two actions together will factor into the full rate‑setting work scheduled for April and May.