SAN FRANCISCO (KCBS) – Kaiser Permanente has not backed down from a proposed 5.2 percent rate hike for San Francisco public employees, despite opposition from unions and some on the Board of Supervisors.

The city would absorb the cost of the higher premiums, a $15 million hit that Supervisor John Avalos said the health management organization has not adequately explained given that San Francisco’s overall health insurance costs for workers covered by other providers went up just 2.5 percent.

“I think it’s important that we question and look at how we can get the best offer. So far, I don’t think we have it,” Avalos said.

About 10,000 municipal employees receive health care through Kaiser, which could be dropped from the city’s health plan unless 9 of the 11 supervisors vote to approve the rate increase.

Kaiser has maintained it is too late to reduce its rates for the coming year, despite pressure from the supervisors and city unions to do just that.

The health giant’s senior vice president in charge of sales and accounts in California, Peter Andrade, appeared Wednesday before the Board of Supervisors budget committee to try and calm a controversy that has raged for more than a week.

“We want to be transparent. We will strive to be more affordable. We will work hard to provide the service and medical care to your employees,” he said.

“These are our neighbors too, so we want to take care of them.”

Andrade’s testimony was enough to convince the committee to forward the rate increase to the full Board of Supervisors, albeit without any recommendation for approval. Avalos said he still plans to vote against it and hold out for a better deal.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)


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