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Recommendations are set, but work isn’t done for PEIA Task Force

CHARLESTON, W.Va. — The PEIA Task Force is ready to make recommendations, but its work isn’t complete.

The task force that was set up by Gov. Jim Justice to help shore up the Public Employees Insurance Agency plans to continue meeting over the next year.

“I’m certain that everyone on this subcommittee has more that they would have liked to have addressed,” Senate Finance Chairman Craig Blair, R-Berkley, said to the Cost and Revenue Subcommittee.

Judy Hale, retired president of American Federation of Teachers-West Virginia, commented, “I just don’t think what we have done what we set out to do.”

Over the course of a four hour meeting Monday afternoon, task force members did agree on some recommendations.

One was accepting Governor Justice’s pledge of $100 million to stabilize PEIA over the relative short term.

Another recommendation is to broaden a proposal meant to even out costs for those seeking medical care just across West Virginia’s border.

The proposal now would apply to all medical facilities considered in-system for PEIA no matter the location. So, for example, Cleveland Clinic or Duke Medical Center would be affected.

The task force left more issues undetermined, though.

Members plan to reconvene to discuss issues such as whether spouses should qualify for coverage if they are insured elsewhere, use of telemedicine and prescription drugs issues.

Another focus would be on structural changes to PEIA such as whether moving its budget from the fiscal year to the calendar year would allow more time to adjust to cost trends.

And most agreed more work needs to be done to simplify PEIA’s many salary-based tiers without penalizing those making the least on the bottom tiers.

The big unresolved question, though, is how to deal with the yearly increases in the cost of health insurance.

It costs about a billion dollars to administer PEIA, and state officials have estimated an annual 5 percent healthcare cost increase.

That amounts to $50 million year over year.

So the first year would be a $50 million cost increase, the second would be a $100 million increase, the third would be a $150 million increase and so forth.

The total spend over a five-year span would be $750 million.

“We’ve not fixed the problem,” said Delegate Mick Bates, D-Raleigh.

Over the course of the task force’s work, members discussed a variety of potential revenue measures, particularly an increase in the severance tax on natural gas.

But task force leaders described continued use of the General Fund as a better, broader way to approach funding.

On Monday, task force members discussed a recommendation to specify $50 million a year in funding should be aimed toward PEIA.

But once officials clarified the need as $50 million year over year over year, the motion failed for lack of a second. Bates, for example, said a straight $50 million would only solve the problem for one year.

The task force did make some progress Monday on a few issues.

Task force members built on a proposal to even out deductibles and co-pays for those who seek medical care at in-network providers just across the state line.

So, for example, those who had a co-pay of 70-30 for medical care at in-network providers across the border would now pay the same 80-20 as those seeking care in-state.

After a long debate, most task force members agreed those evened-out costs should also apply to other in-network providers no matter whether they’re a county away or a few hours away.

That switch is expected to cost an additional $6 million.

“At a cost of $6.2 million, I think that’s something we need to look at,” said West Virginia Education Association President Dale Lee. “It’s treating people fairly, not just those that touch west Virginia.”

Others worried the change wouldn’t do enough to encourage people to choose health care options in West Virginia.

PEIA works out deals with in-state providers to reimburse significantly less than the actual cost of care.

“I applaud our in-state providers for what they’re doing,” Lee said. “We have great facilities in West Virginia and we want to continue those, but this was a fairness issue.”

The Cost and Revenue Subcommittee of the PEIA Task Force has set a next meeting date of Jan. 8.

Meanwhile, public hearings are about to get underway for next year’s plans. 

A teleconference kicks off meetings at 6 p.m. Wednesday. The call-in number is 304-410-0513, and the Conference ID is listed as 304-410-0513.

Meetings will be at 6 p.m. Thursday at the Beckley-Raleigh County Convention Center, Monday at West Virginia University’s Erickson Alumni Center, Tuesday at the Charleston Civic Center and Wednesday at Martinsburg’s Holiday Inn at 301 Foxcroft Avenue.

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