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PEIA board approves burdensome FY18 proposal

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PEIA improves FY 2019 plan, but concerns remain

(Updated at 5 p.m. on Dec. 7, 2017)

The PEIA Finance Board on Dec. 7 made several changes to their initial proposal for the Fiscal Year 2019 plan, and approved those changes at the meeting. There are several positive changes, but some of what remains in the proposal is a real concern for many teachers, service personnel and retirees.

The latest changes include NOT paying for premiums by the person, keeping the existing pharmacy deductibles, requiring 20 percent coinsurance costs on “preferred brand” prescription drugs (down from a proposed 30 percent coinsurance cost) and moving from 10 to five salary tiers, which determine an employee’s premiums.

The Finance Board decided to keep their initial recommendation that total family income be considered when an active state employee covers his or her spouse.

Additionally, the Finance Board agreed to move to four “tiers of coverage,” which are different from salary tiers.

What this means is that instead of the three existing tiers of coverage for a 1) single employee, 2) employee and child, and 3) family, the Finance Board is setting different premiums, deductibles and out-of-pocket maximums for four tiers of coverage by splitting “family coverage” into a new 3) employee and spouse, and now, 4) family.  

(Click on this FY 2019 link to see what you or your family would pay next year in premiums, deductibles and out-of-pocket maximums.)

A 0.5 percent premium increase for active state employees will be reflected in the new salary tiers. The increase is required by the 80/20 rule because Gov. Jim Justice plans to increase PEIA’s budget appropriation by $10 million. The 2 percent premium increase initially proposed for both Medicare and non-Medicare retirees has been dropped.

Otherwise, non-Medicare retirees will see many of the same changes as active employees, including the 20 percent coinsurance costs on preferred brand drugs.
 
For Medicare retirees, generic prescriptions increase from $5 to $10 and preferred brand drugs will increase to $25 for a 30-day prescription or $50 for a 90-day prescription.

Unfortunately, both Medicare and non-Medicare retirees would still have to meet their existing pharmacy deductible. Under the initial proposal the pharmacy deductible had been removed across all plans.

Like active state employees, retirees will not need to pay premium costs for covered family members by the person. 

This PEIA proposal still creates winners and losers, particularly when you consider total family income and its impact on premiums and deductibles. Some will see even lower health-care costs, while others will see higher costs.

“While this is a better plan than what was presented at the public hearings, we still have concerns,” WVEA President Dale Lee said at the Dec. 7 Finance Board meeting. 

As Lee said during the finance board meeting, there needs to be a long-term dedicated stream of revenue to fund PEIA and keep teachers in the classroom. Vacancies continue to grow, our employees are among the lowest-paid in the country and they have gone years without a significant salary increase.

Lee also expressed concern that retirees with a spouse who works would get hit with total family income if the couple is on a family or employee/spouse plan. PEIA plans to factor that retiree’s income – including Social Security or disability benefits – when adding up total family income. 

If you haven’t already, WVEA urges you to sign the postcards circulating in your local association that are addressed to Gov. Justice, Senate President Mitch Carmichael and House Speaker Tim Armstead. The postcards encourage these leaders to stop the increases in medical and prescription drug costs and work toward a multiyear salary increase for school employees during the upcoming legislative session.

Among the other concerns in the PEIA proposal, preferred brand medications for asthma and diabetes are medically necessary and will still be a hardship for many people. People on these medications could pay up to $100 for a 90-day supply or $50 for a 30-day supply.

A teacher making $46,000 each year is paying $950 right now for their family deductible and $341 per month for their family premium in Plan A. Say the teacher’s spouse also earns a $46,000 annual salary. Their total family income would now bump their monthly premium up to $517 and their family deductible to $1,350.

On the other hand, if the same state employee earning $46,000 covers a child but not the spouse, their premiums would drop from $208 to $146 per month and their deductible from $950 to $750 in Plan A.                   

We will continue to post updates about the plan on this page as they become available.