PEIA Finance Board approves burdensome FY 2018 proposal
The PEIA Finance Board approved a Fiscal Year 2018 plan Thursday, Dec. 1, that tweaked the proposal sent out to public hearings in November, but still puts far too much burden for rising health-care costs on active employees, retirees and their families.
The total plan savings – by way of benefit cuts – will be about $55 million.
Active employees with PEIA Plans A, B, and D would see their deductibles increase by $200 for a single employee plan and $400 for a family plan. Out-of-pocket maximums would increase by $1,000 for a single plan and $2,000 for a family plan.
A 90-day prescription fill for all maintenance medications would become MANDATORY. For instance, a blood pressure or diabetes maintenance medication would need to be filled for a full 90 days, which would cause a plan member to pay two copayments up front for generic or preferred brand drugs.
PEIA Director Ted Cheatham acknowledged that many pharmacies in the state will not allow a 90-day fill for all drugs, so patients would have to find another pharmacy that works for them or order maintenance medications through the mail.
This is just one of the hardships plan participants would face if the FY 2018 plan takes effect.
By voicing our opposition and putting pressure on the new Legislature and Governor – as we had to do last year – we can make a difference and improve this bad proposal.
Last year’s outcry ultimately made a difference in how Gov. Tomblin and the Legislature reacted to the PEIA shortfall. We will need a similar effort in the coming weeks and months, and we will keep you updated on needed actions.
On Thursday, accepting the 90-day prescription fill apparently allowed the Finance Board to avoid another option that would have required plan members to pay up to $100 per prescription and a minimum of $25 if it was a preferred brand prescription drug.
The failed option also would have increased prescription out-of-pocket maximums to $2,500 for a single plan or $5,000 for a family plan.
Under the FY 2018 proposal, costs also would rise for many active employees when they receive services that require co-insurance, particularly when medical services are received out of state. For example, the co-insurance responsibility would be 20 percent for services received in West Virginia in Plans A and D but 30 percent for members in Plan B.
That would increase to 30 percent responsibility (in Plans A and D) and 35 percent (Plan B) for services requiring co-insurance outside of West Virginia with approval from HealthSmart. Plan members in A and B would have to pay 40 percent and 50 percent, respectively, for services requiring co-insurance outside the state that are NOT approved by HealthSmart.
Non-Medicare retirees in Plans A and B face the same co-insurance changes.
The Finance Board also decided Thursday to NOT collapse the 10-tier employee salary structure to a much broader 4-tier structure.
The new tier structure would have somewhat affected an employee’s premium, deductible and out-of-pocket maximum costs.
The Finance Board also opted to NOT base an employee’s premium for a family plan on total family income, which would have taken the salary of an employee’s spouse into account.
Non-Medicare retirees would see many of the same plan changes as active employees, including the mandatory 90-day prescription fill for maintenance drugs. There are some big differences, however. For instance, non-Medicare retirees also are facing a 4 percent premium increase.
Their deductibles would increase by $100 for a single plan and $200 for a family plan. Family out-of-pocket maximums would increase to $3,000 total for Plan A participants and $6,000 total for Plan B participants.
Also, a non-Medicare retiree with Medicare dependents on their plan would see their out-of-pocket maximum increase to $2,700.
Active employees and non-Medicare retirees also can expect:
| A modest premium increase/adjustment of 0.5 percent for members with Plan A (and Plan D for actives).
| Specialty drug copayments to increase to $100/$150 total.
| More than 130 outpatient procedures – ranging from X-rays to MRIs, ultrasounds and cancer screenings -- would be subject to maximum facility fees.
| $20 copayments for all primary care physician (PCP) or medical home program (MHP) visits.
Medicare retirees also will experience cost increases. Participants in the Humana/PEIA Plans 1 and 2 and the Special Medicare Plan would see a 4 percent premium rate increase, a deductible increase of $50 and an out-of-pocket increase of $450, as well as prescription drug changes.
Here are the prescription changes for members in Humana/PEIA Plans 1 and 2: Tier 1 generic drugs would cost $5; Tier 2 preferred brand drugs would cost $15; Tier 3 non-preferred brand drugs would cost 50 percent co-insurance and Tier 4 specialty drugs would cost $100.
Pharmacy benefits for retirees in the Special Medicare Plan will follow PEIA’s Plan A prescription benefits plan.
Participants in the Retiree Benefit Assistance program will see an increased medical deductible of $25, a $300 medical out-of-pocket increase and the same “Tier 1 through Tier 4” pharmacy changes as members in Humana/PEIA Plans 1 and 2.
Participation in the Retiree Benefit Assistance program is based on income and is available to Medicare participants.
WVEA Communications and Government Relations Specialist Davin White spoke before the Finance Board on Thursday, and told board members that many teachers and public employees are either leaving the profession or not entering it to begin with because the increase in their health-care costs are eroding their already low salaries.
“It’s really becoming difficult for employees to take on much more, and PEIA has unfortunately become a plan that punishes those who need medical care the most,” he said.
We also urged the Finance Board to join us in calling on the new Legislature and Governor to finally reach a long-term solution to fully funding PEIA and building back its reserves.
It’s time to stop “kicking the can down the road.”
Another troubling PEIA plan going out to public hearings
Active state employees could face $25 million in benefit cuts and retirees face about $17 million in cuts to PEIA in the coming year.
The PEIA Finance Board voted Thursday, Oct. 13, to take a draft of a fiscal year 2018 plan out on public comment in November.
This is another unacceptable proposal that solely burdens employees, retirees and their families with the rising cost of health care. Please plan to attend a public hearing near you again and voice your opposition to this latest proposal.
But let's not forget the Republican majorities in the House and Senate who balked at a full $1 increase in the cigarette tax, which would have significantly improved this problem. The GOP had enough votes to pass whatever they wanted. Instead, they made hollow promises about FULLY funding PEIA.
For active state employees and non-Medicare retirees, deductibles could increase by hundreds of dollars and out-of-pocket costs by thousands of dollars for people in Plan A, B or D.
The proposal that will go out on public hearing includes a $200 deductible increase for single employees and a $400 increase for family coverage. Out-of-pocket maximums could increase by $1,000 for an employee-only plan and $2,000 for a family plan.
Medicare retirees face a 4 percent premium increase, a $50 deductible increase, a $450 out-of-pocket maximum increase and some prescription drug changes.
Some of the other proposed changes for active employees and non-Medicare retirees are:
| Increases in percentage of patient costs for services that require coinsurance, particularly when the medical services are received out of state.
| Mandatory 90-day prescription fills for maintenance drugs, such as blood pressure medication. A couple concerns about this is that the upfront copay cost will be more for a 90-day prescription than it would for a 30-day prescription. Also, PEIA Director Ted Cheatham acknowledged that some pharmacies in the state only want to let patients fill 30-day prescriptions.
| Basing an employee’s premiums on total family income if the employee’s spouse or entire family is also receiving PEIA coverage. As proposed last year, there would be winners and losers who would either pay more or less in premiums – depending on the family’s total income.
| For people on Plans A, B and D, an increase in out-of-pocket prescription drug maximums from $1,750 to $2,500 for employee-only coverage and from $3,500 to $5,000 for employee/child and family coverages
| Requiring more in coinsurance (30%) for people who have to go through substance abuse treatment a second time, and 50% in coinsurance for people who attempt substance abuse treatment three or more times
| Increasing the patient’s cost of a “preferred brand” prescription drug from $25 or $30 to 30% or 35% of the total cost of the drug. But there would be a $25 minimum cost and a $100 maximum patient cost for these preferred brand drugs, according to the proposal that will go out to public hearings. So if a prescription drug’s total cost is $600 then the patient’s responsibility could be near or more than $200, depending on their health plan. However, with the $100 maximum a patient would pay no more than $100 for the drug. Still, patients also would pay no LESS than $25 for any preferred brand drugs.
| Increasing specialty drug copayments from $50/$100 to $100/$150
| Increasing the number of procedures subject to maximum facility fees
| Other changes internal to PEIA administrators, such as reviewing provider reimbursements
We will keep you up to date as we receive more details about the proposals that are going out to public hearings.
Last year’s outcry at the six statewide public hearings still made a difference in how Gov. Tomblin and the Legislature reacted to the PEIA shortfall, so please attend a hearing.
Of the six public hearings, the first will be at the Big Sandy Arena in Huntington on Wednesday, Nov. 9.
The other public hearings are:
| Wednesday, Nov. 9 at the Big Sandy Arena in Huntington
| Thursday, Nov. 10 at the Tamarack’s Ballroom A in Beckley
| Monday, Nov. 14 at Holiday Inn, 301 Fox Croft Ave., in Martinsburg
| Tuesday, Nov. 15 at WVU’s Erickson Alumni Center, One Alumni Drive, in Morgantown
| Wednesday, Nov. 16 at WV Northern Community College’s Auditorium, 1704 Market Street, in Wheeling
| Thursday, Nov. 17 at the University of Charleston Ballroom in Charleston
All the public hearings run from 6 p.m. to 8 p.m. with registration and customer service running from 5 p.m. to 6 p.m.
PEIA Coalition Press Conference – 3/11/16
A number of organizations representing PEIA participants have been working together this session in an attempt to attain full funding for PEIA for 2016-17 and beyond. The press conference was called after the most recent attempt to pass legislation in the House to fund PEIA was defeated.
An amendment offered by Delegate Mick Bates, D-Raleigh, attempted to amend H.B. 4742 and secure $72 million to put into a PEIA trust fund with the intention of banking money to avoid premium increases for active employees and retirees.
The amendment failed 62-36, strictly along party lines. The Republicans voted against the amendment and the Democrats voted in favor of the amendment.
At the press conference each of the coalition groups were given three minutes to speak and a specific issue to address concerning the problems with PEIA funding.
WVEA’s comments focused on the fact that contrary to what legislators are saying PEIA is not fixed in the current year nor has anything been done to address the problems we will face in future years.
Below are the remarks by WVEA President Dale Lee at the coalition press conference on PEIA–
Most education employees have found this to be a very disappointing session. Rather than focus on striking an appropriate balance between reducing government spending and increasing taxes that are desperately needed to provide revenue for roads, PEIA, education improvements and jobs – the Legislative leadership has focused on legislation that does nothing to position our state for the future; but to focus on issues that divide our state – things like Right to Work, repeal of the Prevailing wage, raw milk, common core, religious freedom, conceal carry and others.
Legislative leaders continue tell us not to worry and say that PEIA is fully funded. That statement is simply false!
Based on the proposed budget in the House, an active employee with a family plan will see their annual premiums increase 12%, that could be anywhere from a $318 to $1,120 increase, depending upon income level; and in addition, they will still see reductions in benefits. Our retirees will see premiums increases of 10%.
Also, do not fall for the statement that PEIA is a Cadillac plan. The benefits, out-of-pocket costs, co-pays and prescription drug benefits are not superior to most plans in the private sector. At one time such a statement might have been true but year after year of benefit reductions and increased premiums have taken its toll.
Keep in mind active employees have not received a salary increase and are among the lowest paid educators in the nation. There are no cost of living increases in our state retirement programs for retirees. Yet, year after year, the state balances PEIA on the back of its employees and retirees.
For participants of the plan, the increased co-pays, deductibles and premiums amount to a reduction in pay. The House’s proposed budget continues the trend of taking money out of the pockets of employees and retirees to balance the obligations of the state. Shame on you!
And finally, the House’s Budget does nothing to address the deficits that will arise in the future. Since the budget is balanced with one-time money, in the 2017-2018 budget year PEIA will be in the same financial conditions as it is currently, with employees facing draconian budget cuts.
The impact on personal finances of our employees and retirees cannot be overlooked. How can we recruit and retain our highly qualified professionals if we continue with these disastrous cuts? When legislators suggest that employees need to cut basic services such as Internet or find a second/third job, it is clear they are not serious about solving this problem.
It’s time for the House Republican leadership to stop playing partisan games with hard-working education employees, state employees, and retirees. They need to prepare a budget that adequately funds our vital state programs, including PEIA – not just this year but into the future.