Cheatham: PEIA bill would give finance board more flexibility

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Cheatham: PEIA bill would give finance board more flexibility
By Jeff Jenkins, WV MetroNews

A bill approved Monday by the House of Delegates Finance Committee would give the state PEIA Finance Board more flexibility when it comes to the annual changes in health insurance for active state workers.

The bill (HB 2871) would eliminate the mandated employer versus employee cost share of 80 percent employer, 20 percent employee for PEIA and allow the finance board to go with a cost share anywhere between 80/20 and 60/40.

PEIA Director Ted Cheatham spoke in favor of the bill during Monday’s meeting. He said under the current cost sharing, if the legislature puts more money into PEIA the employees automatically have to pay more in premiums. The bill would allow the finance board to shield premium increases if the legislature would add money, Cheatham said.

“We could take all of the revenue you gave us and use it to offset those benefit reductions rather than raising premiums,” he told the committee.

The legislature put an additional $67 million into PEIA last year but because of 80/20 there was a 12 percent premium increase for active state workers. There’s no new money expected for PEIA in the new budget so the finance board has responded with $50 million in benefit cuts beginning July 1.

State law requires the PEIA plan to be made whole each year and that can only be done by benefit cuts or additional money from the legislature. Cheatham told committee members even with the bill, it’s state workers who take the brunt of any plan changes year in and year out–but with more flexibility the board can make those less stinging.

“The bottom line is that without additional money from you the employee is still getting 100 percent of the damage to make the plan whole. That’s what I want to make clear,” Cheatham said. “This (the bill under consideration) just lets the finance board decide, ‘Do we want to shoot you or do we want to stab you?””

The bill passed the committee on a voice vote and was forwarded to the full House of Delegates for consideration.