The California public employees retirement system is proposing a - Central Coast News KION/KCBA

SACRAMENTO--The California public employees retirement system is proposing a 79-percent annual rate increase on about 115-thousand long term care beneficiaries. Those members face paying hundreds or thousands of dollars more a year until the program becomes financially stable.

Members will have options: pay the 79-percent rate hike annually, or take the increases incrementally over 3 to 5 years.  Members will also have the choice to forego lifetime insurance and cap their coverage at 10 years to avoid the rate hike altogether.

What people pay, varies with age, but on the average, a long term care insurance member pays nearly 22-hundred a year. A 79-percent rate hike would mean paying about 17-hundred dollars more a year, bringing the new annual fee to more than 39-hundred dollars.

The Calpers Long Term Care Fund was initiated in 1995, and by all accounts, the initial premium was too low. By 2003, benefits paid out were exceeding rates paid in, so Calpers began increasing members' rates. Now a new rate hike is coming for people who are mainly retired and living on a fixed income.

In 2008, because of the program's financial problems, Calpers temporarily suspended selling new long term care insurance policies. It hopes to begin again in a couple of years.

Details on the premium proposal will be presented to the Calpers' Pension and Health Benefits Committee on October 16th. Final approval of the rate hike is expected the following day.