W.Va. officials should consider PEIA means testing

An editorial from The Intelligencer/Wheeling News-Register 

WHEELING, W.Va. — “It’s going to be very difficult for some people on this plan if they get sick,” West Virginia?Public Employees Insurance Agency Executive Director Ted Cheatham said of a plan to cut benefits.

That may be putting it mildly, especially for some PEIA retirees subsisting on very limited incomes.

PEIA officials last week proposed a massive cut in health insurance benefits – $83 million for public employees still on the job and $41 million for retirees. The agency’s board will vote on the plan in early December.

No doubt there will be a major outcry among PEIA clients. But this time is not the same as that involving some premium increases and benefits reductions in the past, say agency officials.

For one thing, it is highly unlikely there will be any state bailout. Gov. Earl Ray Tomblin and legislators will have enough to do to keep the budget in balance without adding new PEIA subsidies to it.

For another, the PEIA’s reserve fund, a sort of rainy day account that in the past has been used to blunt the impact of some cutbacks, is down to its minimum level.

As agency board member Josh Sword, who represents public school employees, put it, “we’re truly at a point where the board’s hands are tied on this.”

Spending is to be reduced primarily through cutting benefits and raising deductibles for health care treatment and drugs. An example cited by the agency is that public school and state employees will have to cover deductibles $500 higher for individual coverage and $1,000 for families.

That will hit everyone, whether still working or retired, hard.

But it will be especially tough on retirees who never earned much during their working careers. Their pension checks provide far less latitude to deal with unexpected expenses such as health care deductibles.

For that reason, PEIA officials should take another look at their options. If some sort of means testing – cutting benefits less for retirees with comparatively lower resources – is possible, it should be considered.

PEIA officials may not be able to do anything about the bottom line. But they should do what they can to help retirees least able to find more money to cover the changes.

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