Most of the major problems in any category in West Virginia can be addressed in three steps: finding enough money, properly spending it and maintaining that revenue. All too often, the state doesn’t even get to step two.
Yet, this is what it is going to take to fix the state’s Public Employees Insurance Agency. And, make no mistake, PEIA needs fixing in a way that doesn’t put a further financial burden on state employees, including public educators. That’s not to say premiums or deductibles can’t increase, but, if lawmakers are wise, they’ll look for ways to make that increase as negligible as possible.
Although, whether the Legislature will even look to do that is in doubt. Sen. Tom Takubo, R-Kanawha, said last month that PEIA is among the cheapest health insurance benefits packages anywhere in West Virginia. Senate Finance Committee Chairman Eric Tarr, R-Putnam, said in a written statement that PEIA premiums and deductibles pale in comparison to costs in the private sector, and public employees, who have been getting consistent raises and have seen PEIA rates increase only once in the past six years, shouldn’t be complaining.
Certainly, there’s some truth to what Takubo and Tarr have said, but the issue is more complicated than it might seem (something Takubo acknowledged). Premium rates didn’t just go up for the first time in six years, they jumped up by almost 25%. And state employees are now facing another 14% to 16% hike in premiums, along with a 40% increase for deductibles and caps on out-of-pocket spending. Higher co-pays are also being proposed, as the PEIA board looks to implement $113 million in cost increases to cover rising medical costs.
This is a shock to the system for many state workers, largely because of inaction from government leaders and lawmakers in recent years. Sometimes it gets forgotten that, when West Virginia teachers and school service personnel went on strike in 2018, it wasn’t primarily because of low pay, but a demand that PEIA be stabilized. Teachers got a 5% raise, but the issues dogging PEIA — a lack of revenue and a failure to make incremental adjustments — weren’t really addressed.
Yes, Gov. Jim Justice appointed a task force to address the PEIA problem. That group conducted public meetings for a year. A proposed solution was apparently suggested, but Justice decided to throw $150 million in so-called “surplus†money at the problem instead of instituting a long-term fix (an amount the Legislature knocked down to $105 million).
In the meantime, Justice and the Legislature have used supposed surplus funds to justify massive income tax cuts and other incentives that decrease state revenue, while failing to address massive staffing shortages and a lack of resources at many vital state agencies and public schools. As a result, the problem with PEIA is even worse now, because there’s less state revenue to work with.
Some, like Tarr, might question why state workers should get by with lower health insurance costs subsidized by taxpayers. But the importance of good benefits is fairly obvious when considering most state workers in West Virginia make far less than their counterparts in other states (teachers in West Virginia consistently rank last in the nation for average salary). There isn’t much attracting people to important state jobs. If the advantages of PEIA get tossed out the window, things are going to get much worse.
