PEIA investments, reserve fund could keep premiums the same for another year

By WV MetroNews

CHARLESTON, W.Va. – State workers who get their health insurance through PEIA will find out next month what changes will be proposed in their coverage plan that will begin next July. The PEIA Finance Board met Thursday, September 23 in Charleston and received a report on the insurance program’s finances.

PEIA finished its budget year $47 million ahead of projections, mainly because its investment income came in at $40.6 million, which was $29 million ahead of estimates. The boost was able to cover ongoing increases in medical expenses. The insurance program also benefits from a premium deficiency reserve fund of $83 million. That’s helped keep monthly premiums the same for workers for several years. It remains to be seen if the better-than-expected investment income will keep premiums the same next year. PEIA’s Chief Financial Officer Jason Haught said the financial picture could have been much worse considering what’s happened with 2019. “This is pretty good news,” Haught told the board. “I was actually preparing myself for an unmanageable spike in health care utilization that was going to hit us too hard and impact our financial position. Luckily, what we have seen has been sustainable.”

West Virginia Education Association President Dale Lee urged the finance board to work with Gov. Jim Justice and the legislature to come up with a long-term funding plan for PEIA. “The news is good for this year but we are facing a challenge coming up,” Lee predicted. PEIA has previously projected a 7.5% increase in costs in 2023, a 7.9% cost increase in 2024 and 8.2% in 2025. Lee said you can only live off good investment news for so long. “It has been a big help for this year and maybe even into next year but at some point the market is going to adjust,” Lee said. The teacher union leader lamented again Thursday about the work of the PEIA task force from 2018 has yet to be acted on by state leaders. “We knew in 2018 that just a band-aid wasn’t going to work. Unfortunately the task force has been neglected, our recommendations, by the legislature,” Lee said.

After the proposed plan for 2022-23 is rolled at next month’s meeting, PEIA will hold public hearings in Martinsburg, Morgantown, Wheeling, Charleston and Beckley in Novembers to give those covered by the PEIA to comment. The PEIA Finance Board will vote on the new plan in December. The board also learned Thursday the PEIA Trust Fund has a balance of $1.581 billion.