After softening some of the more criticized elements of the proposed plan, PEIA Finance Board members approved PEIA’s 2018-19 health insurance benefits package for public employees Thursday afternoon.
“You have a voice with us. We heard you, and tried to make adjustments as best we could,” Administration Secretary John Myers said shortly after the plan was approved.
However, representatives of public employee and teacher unions and retiree organizations stressed that PEIA’s annual ritual of benefit cuts and cost increases is not sustainable in the long-term.
“You can’t continue to fund PEIA on the backs of employees,” West Virginia Education Association President Dale Lee told the board. “You can’t continue to take away.”
Christine Campbell, president of American Federation of Teachers/West Virginia, concurred, noting, “What are we going to do long-term to assure that people that aren’t making that much money and chose to stay in West Virginia can have the health care they deserve?”
After hearing criticism at public hearings around the state last month, Finance Board members approved several changes to the proposed 2018-19 plan.
For active employee coverage, changes approved Thursday include:
n Eliminating a proposed “pay by person” plan for family coverage that would have imposed separate monthly premiums for spouse and each dependent child, which would have caused premiums for lower-salary employees with large families to soar.
“I think we all agreed that pay by person was a little too much impact on a lot of people,” PEIA Executive Director Ted Cheatham said.
n Changing a proposed 30 percent copay for preferred brand-name prescription drugs, capped at a $200 maximum payment for a 90-day prescription, to a 20 percent copay and $100 maximum.
That still will amount to a significant increase for those who currently pay a $25 to $30 deductible for those brand-name prescription drugs.
n Shrinking the existing 10-tier salary-based premium scale to a five-tier scale, instead of the three-tier scale originally proposed.
Critics of the three-tier scale, which condensed the three lowest income tiers into a single tier of $36,000 or under, and condensed the four highest income tiers into a single $62,501-or-higher tier, would have increased premiums for low-salary employees while giving significant premium cuts to the 1,200 highest-paid public employees in the state.
The five-tier scale, in increments of $30,000, results in less dramatic premium changes, either in increases or cuts.
Cheatham said no one with single coverage will see premium increases under the approved plan. That’s despite an overall 0.5 percent increase in premiums mandated under the plan’s 80-20 requirement, since the state is increasing employer’s premium payments by $10 million for the 2018-19 budget year.
However, the plan does adopt a total family income calculation for family coverage, in which the spouse’s income is counted in determining the insuree’s salary tier. Insurees are not required to disclose total household income to PEIA, but those who do not will automatically be bumped into the highest (more than $120,000) premium tier.
Also eliminated are proposed 2 percent premium increases for retirees and for nonstate active employee policies.
Cheatham said the board recognized that raising premiums on retirees on fixed incomes would be a hardship.
Ernie “Spud” Terry, with the Coalition of Retired Public Employees, thanked the board for eliminating the proposed premium increase, noting that many retired public employees cannot afford even small cost increases.
“Any little bit of out-of-pocket cost, any little bit of premium increase ... makes our lives, as retired public servants, very tenuous, to say the least,” Terry said.
Elaine Harris, who was removed from the PEIA Finance Board this summer and who represents regional jail and correctional workers, told the board that those employees also are unable to absorb higher health care costs.
“We have people that qualify for public assistance. They qualify for a program that is very much in jeopardy at the federal level, and that is the CHIP program,” she said, referring to the Children’s Health Insurance Program, a program that is in limbo since its federal funding expired Sept. 30, and Congress has yet to reauthorize the $14 billion a year of funding for the program.
Meanwhile, as Lee noted, while PEIA’s 2018-19 plan leaves most employees comparatively unscathed, PEIA’s long-term financial plan projects that the agency will need to increase employee premiums by 11 percent per year, beginning as soon as 2020.
“It all boils down to priorities,” Lee said. “If the state has a priority that we want highly qualified teachers, highly qualified service personnel and, for that matter, highly qualified state employees, we have to show we value them.”