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PEIA to continue discussions with hospitals about reimbursement rates

CHARLESTON, W.Va. — A bill that got a lot of discussion but didn’t pass during this year’s legislative session will continue to get a lot of discussion in the months ahead.

SB 574 which would have increased in-patient PEIA reimbursement rates for some of the state’s largest hospitals failed to make it through the process on the session’s final day.

PEIA Interim Executive Director Jason Haught told members of the PEIA Finance Board last week the agency wants to work with hospitals to find the best way to increase reimbursement rates.

“We do wish to improve that reimbursement level. That’s not ever been the issue. It’s the means to do so, that’s what the challenge is,” Haught said.

Right now when the state’s largest hospitals provide in-patient services for a person covered by PEIA they are reimbursed at a rate of 59% of the cost. The bill would have increased the rate to 110% of the Medicare reimbursement rate. The bill called for a similar reimbursement increase for PEIA patients who use ambulance services through EMS.

The bill said PEIA would take the money to make up the difference from its reserve funds.

“The levels of 110% would be tough,” Haught told the finance board last week. “I’m not going to pull any punches. That would be very difficult to accommodate.”

But Haught said they are willing to work with the West Virginia Hospital Association and lawmakers to find a compromise.

“We are aware of the concerns of the hospitals and we do wish to try and accommodate their concerns to the best of our ability with the resources we have available,” he said. “We are looking at the various resources we have to do so.”

Haught said a close look at the reserve fund levels would be part of the review. He said a phase-in of an increased reimbursement rate would be better for PEIA.

Jim Kaufman

“Hopefully we can work out some means to be able to do it at a pace we can all agree upon and we can do it in an agreeable fashion,” Haught said.

West Virginia Hospital Association President Jim Kaufman told MetroNews earlier this month the increase in reimbursement rates would help the state’s larger hospitals like CAMC, Cabell-Huntington, St. Mary’s and Ruby Memorial. He said smaller hospitals already receive a higher reimbursement rate for PEIA patients.

“This is a true help for hospitals,” Kaufman said.

Haught said some reimbursement rates were raised to deal with COVID. He said they may be a good place to start the discussion on how to gradually increase the rates.

State Secretary of Administration Mark Scott said lawmakers appear to understand any reimbursement increase would have to be accompanied by a reduction in costs for PEIA.

Mark Scott

“The amount of increase in premiums that it would take to go from 59% to 110% would be very cost prohibitive so there have to be ways to save costs at the same time,” Scott said. “That would be something that would have to be taken under consideration.”

State workers covered by PEIA haven’t had a premium increase since the 2017-2018 plan year.

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