As we approach Open Enrollment, we are providing this information to ensure UC Davis employees are informed about changes to UC Davis medical plans and plan rates for 2025.

While medical plan rates will rise again this year, they won’t increase as significantly as they did last year, thanks in large part to the steps UC campuses have taken to further subsidize plan costs.

Maintaining affordability while providing generous, high-quality medical benefits is a top priority for UC Davis, and our medical benefits are one of the reasons we rank as a top employer.

How UC Davis is Responding to Rising Medical Plan Costs

UC is no different than other employers facing significant increases in medical plan costs. National trends that contributed to higher costs in 2024—such as increasing healthcare utilization, aging population, rising rates of chronic conditions, and expanding use of costly new drugs and treatments—have continued into 2025.

However, as shown in the table below, UC subsidizes a greater percentage of medical plan rates than other employers nationally.

UC Davis is increasing its contribution to medical plan rates to help keep our employees’ contributions lower in 2025. This includes continuing to subsidize the employee contribution for the UC Blue & Gold plan to match Kaiser Permanente, making our own health care system more affordable for our employees. UC Davis is the only campus that subsidizes the UC Blue & Gold plan for employees.

Our represented employees will continue making the plan contributions specific to their bargaining group, as UC Davis honors the commitments made in union contracts for employee contributions to health benefits.

What Are the Cost Increases for 2025?

• Employees with salaries up to $140K will see an average increase of 9% in medical plan contributions, while those earning more will see an average increase of 11%. Your medical plan contributions for 2025 are based on your full-time salary as of January 1, 2024.
• For the first time, the CORE PPO plan will require an employee contribution, which will be the lowest employee contribution of all options. This change more equitably shares the costs of medical coverage across all employee plans.

Additionally, to help minimize plan rate increases, certain costs for receiving care and filling prescriptions will also go up next year. 

• The copay for outpatient visits will increase from $20 to $30, for UC Blue & Gold HMO, Kaiser HMO, and UC Care PPO (UC Select/Tier1), the first such increase in over 10 years.
• Prescription drug copays will also rise across most of UC’s medical plans. 

Using ALEX for Guidance

We encourage employees to use ALEX, UC’s benefits decision support tool, to get personalized guidance on selecting health and welfare benefits. ALEX provides specific medical plan rates based on your personal situation, including your pay band and union membership.

When Will I Start Paying the New Plan Rates?

Your new coverage will begin on January 1, 2025 and your payments are made via payroll on a pre-tax basis.

• Monthly paid employees: You will see the first deduction on your January 2, 2025 paycheck.
• Bi-weekly paid employees: Deductions will begin on your December 4, 2024 paycheck.

Questions?

• Join one of our virtual or in-person UC Davis Benefits Help Desks
• Email benefits@ucdavis.edu
• Read FAQs and answers on UCnet

Letter from Systemwide HR Vice President Cheryl Lloyd

“As we approach our annual Open Enrollment for health benefits, I want to share what we know about UC’s medical plan costs for 2025 and update you on how we’re preparing for 2026 and beyond. My goal is to provide information as early as possible so you can make informed decisions about your benefit plans.”

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