PEIA: Benefit cuts of $40 million needed next year

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By Phil Kabler  
The Charleston Gazette

The Public Employees Insurance Agency needs to cut health-care benefits by $40 million next year — and will let insurees vote on what benefits to cut.

“We’re going to ask our constituents how they want these $40 million of benefit cuts distributed,” PEIA Executive Director Ted Cheatham said Thursday.

PEIA Finance Board members on Thursday approved a menu of possible cuts to take out to public hearings statewide next month, before a December vote on the 2015-16 benefits package.

As approved Thursday, the new plan would need to cut $30 million in benefits for active employees, $3 million for county and municipal employees covered by PEIA, $4.5 million for pre-65 retirees and $4 million for Medicare retirees.

For active employees, the menu of cuts includes increasing out-of-pocket maximums for family coverage, increasing deductibles, increasing primary- care office visit co-pays by $5 to $20, increasing specialist office visit co-pays by $15 to $40, doubling the outpatient surgery co-pay to $100, doubling the Urgent Care visit co-pay to $50, eliminating coverage for massage therapy and for removal of impacted wisdom teeth, among other options.

“These are going to be difficult public hearings,” Cheatham said.

Cheatham also is looking at instituting a Healthy Tomorrows program, which would increase the annual deductible by $500 for employees who fail to meet standards to encourage healthy lifestyles.

In the first year, the only requirement would be to name a primary-care physician. In the second year, insurees would have to have a primary-care physician and report their blood pressure, glucose, cholesterol and waist circumference. By the third year, insurees would have to have blood pressure at or under 140/90, glucose at or under 125, and cholesterol at or under 245, to avoid the higher deductible.

Cheatham said it will be one of several initiatives to promote healthy lifestyles.

“PEIA is finally getting to the place where we have the tools for members to take care of themselves,” he said.

Other tools include an online version of the Healthcare Bluebook, to compare provider cost and quality for 143 common medical procedures, as well as for 115 commonly prescribed prescription drugs.

Josh Sword, who represents teachers on the Finance Board, noted that part of the reason for the benefit cuts is that employer premiums for PEIA have not increased in three years.

Cheatham said PEIA could not consider a premium increase this year because the governor’s budget recommendations for the 2015-16 fiscal year does not include additional funding for employer premiums for PEIA.

Public hearings are scheduled for Nov. 10 in Beckley, Nov. 13 in Huntington, Nov. 17 in Martinsburg, Nov. 18 in Morgantown, Nov. 19 in Wheeling and Nov. 20 in Charleston.

“I think it’s important for us to have public hearings, to get input on the big issues we know we’re going to face, not just this plan year, but the next,” said acting administration secretary Jason Pizatella, who serves as chairman of the Finance Board.