The Public Employees Insurance Agency of West Virginia is proposing a health insurance premium increase of 35% over two years for state employees, despite already rising healthcare costs. This comes after the state legislature passed a bill earlier this year to increase health insurance premiums by 25% due to the agency’s $376 million deficit. Governor Jim Justice claims that this increase will be balanced out by state employee salary raises and a 5% increase proposed for next year, but many employees argue that these pay raises are not sufficient.
State Employees Resist Proposed Health Insurance Premium Hike in West Virginia
Proposed premium increases by West Virginia’s Public Employees Insurance Agency (PEIA), the authority responsible for health insurance of over 200,000 government personnel, have met with opposition. This pushback comes five years following a strike by public school staff over escalating healthcare expenses.
PEIA’s proposal involves a 35% premium hike for state employees over two years. Despite state employees receiving recent tax cuts and pay raises, many argue they can’t afford the increased premiums. This concern was voiced during a series of public hearings held this week.
Teacher Casey Lockerbie, who commutes to West Virginia for work, stated during a virtual hearing that despite recent pay raises, the health insurance premium increase resulted in her earning less than the previous year. Lockerbie highlighted that attracting new personnel to the state shouldn’t entail penalising existing employees.
Earlier this year, PEIA faced a $376 million deficit. In response, the GOP supermajority state Legislature passed a bill introducing a 25% increase in state employee health insurance premiums, plus a $150 surcharge for spouses opting for the state plan over their employer’s.
The legislation also enforced an 80-20 cost split between the employer and employees on PEIA. The proposed plan will increase state employees’ premiums by an additional 10.5% next July. The agency’s finance board is set to make a final decision in December following this month’s public hearings.
This proposed increase contradicts promises made by Republican Governor Jim Justice in 2021 to not raise premiums. In 2018, a strike occurred due to apprehensions over the long-term solvency of PEIA. Despite the creation of a task force to address these concerns, no significant policy changes have been made to stabilize the budget.
Justice claims these increases are balanced by pay raises of $2,300 for state employees this year and a proposed 5% increase next year. He also signed legislation that cuts state income tax by an average of 21.25% across brackets. However, critics argue these measures are insufficient as West Virginia teachers rank among the nation’s lowest paid.
During an earlier hearing in Charleston, union leader Joe White urged the finance board to remember the human cost of these increases. He pushed for respect towards the state’s employees, including those in organized labor and school personnel. The premium increase would also affect retired employees not yet eligible for Medicare and city and county employees insured by PEIA.