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By PR Lockhart, Mountain State Spotlight
It was the middle of fall and Christy Cardwell’s migraines were starting to get too much for her.
She was rear-ended in a car accident in September, and has been working with insurance providers in hopes of reaching a settlement. But his migraines, which had been a problem for years, became more frequent. She also noticed that she was beginning to lose some sensation in one of her hands, first in the fingers, then in the palm.
But months later, Cardwell still hasn’t had the MRI her doctor recommended. As a public school teacher in Wyoming County, she is insured through West Virginia’s Public Employees Insurance Agency, or PEIA. And the hospital told her she’d have to pay hundreds of dollars in advance before she could get the test. That was money that Cardwell, a mother and a teacher for the past 24 years, didn’t have.
She eventually found some relief by working with a chiropractor, but she was dismayed by what she saw as a major change in her insurance coverage.
“What is considered the gold standard of insurance, I shouldn’t be paying hundreds of dollars just to see why I’m getting migraines,” she said.
These frustrations are not unique to Cardwell. PEIA insures more than 200,000 teachers, state employees, city employees, correctional and law enforcement officers, and other public employees throughout West Virginia. Over the years, the agency has dealt with financial crisis after financial crisis and currently faces a $376 million budget shortfall through 2027.
For the past five years, the agency’s finances and potential insurance changes have been frozen; That’s when Gov. Jim Justice pledged to fix PEIA and allocated $105 million in temporary funding to keep the agency running without increasing costs for public employees. But with all that money to be used up by 2024, the agency now must grapple with several crises it has avoided addressing.
And as the issues escalate, the potential costs are hitting state employees hardest, who argue they can’t afford to let PEIA go unheeded. Now, as lawmakers eye ways to shore up the struggling agency, further increasing costs and reducing benefits are two options legislators say must be considered.
“I thought we had some time before things got bad,” Cardwell said. “But we didn’t.”
An Employees Insurance Agency in Trouble
Many of the problems facing PEIA are cyclical: increases in medical inflation and drug prices, along with changes in the marketplace, increase the cost of maintaining insurance. This causes PEIA’s costs to increase almost annually, requiring almost-constant growth in revenue for the agency to stay above water.
Controversy over the agency’s insurance arose in the 2010s, as those covered through PEIA expressed frustration with benefit cuts. In 2016, for example, PEIA’s Board of Finance approved a $120 million benefit cut after the Legislature failed to agree on a plan to provide more money. Educators have since noted that the cuts have left them paying more in insurance deductibles, out-of-pocket maximums and copays, making it harder for them to stay on top of their health needs.
“the questions [PEIA faces] I think they are similar to what we faced 30 years ago, but their magnitude could be worse,” said Emily Spieler, professor of law at Northeastern University School of Law and PEIA’s finance professor in the 1990s. Founder Member of the Board.
The issue has created a situation where outcry over PEIA occurs every few years, especially at moments when the agency proposes benefits cuts to address critical financial issues. PEIA was a major driving factor behind the 2018 teachers’ strike, when Cardwell and about 20,000 other West Virginia teachers walked out of class and gathered at the capitol. Not long ago, the agency was considering possible changes to PEIA pay levels that would require many public employees to pay higher premiums.