QUESTIONING THE BILL – House Minority Whip Shawn Fluharty said West Virginians were being duped by claims from the Republican supermajority on Senate Bill 268. -- Photo Courtesy/WV Legislative Photography

CHARLESTON — With a week left in the 2023 legislative session, the West Virginia House of Delegates pushed out bills reforming the state’s public workers health insurance plan, its version of the fiscal year 2024 budget, pay raises for public employees and approved the compromise on tax reform with the Senate.

The House met Saturday morning to consider these and other bills before the 60-day legislative session ends at midnight on March 11.

The first bill considered Saturday was Senate Bill 268 relating to the Public Employees Insurance Agency. The bill passed 69-27 and heads back to the Senate to concur with changes made to the bill by the House in committee and on the floor.

SB 268 sets the reimbursement rate for all healthcare providers at a minimum level of 110 percent of what Medicare reimburses providers, sets numerous requirements for members of the PEIA Finance Board, requires a five-year analysis of potential future costs to the program and an actuarial study of the plans offered by PEIA.

The bill also requires PEIA to return to an 80/20 employer-employee match beginning in July, though the employee/employer match would go to 70/30 for out-of-state medical care for non-contiguous out-of-state counties. The bill only affects the public plan and not plans for counties and cities.

The bill would change the price of the plan for spouses of PEIA plan participants who have access to health insurance coverage to the actuarial value of the PEIA plan, which could cost plan participants an additional $147 per month during the next plan period according to PEIA.

Debate for and against SB 268 went for more than three hours Saturday, stretching from 9:20 a.m. to the early afternoon. Supporters acknowledged the pain that would be caused by returning PEIA to a 80/20 plan, but said SB 268 was the best way to ensure that PEIA still exists down the road.

“We are here because this program is failing,” said Delegate Charles Sheedy, R-Marshall. “Nobody ever decided to fix it. Guess what? I was elected by my constituents – my constituents are teachers, they’re Division of Highways workers, they’re construction workers, they’re coal miners – to come down here and fix what is broken in Charleston. I say we fix this and vote yes for it now and get the job done.”

“When you find yourself in a hole, stop digging,” said Delegate Bob Fehrenbacher, R-Wood. “I personally feel that the fiscally responsible position, which is painful, is to vote for this bill.”

The bill was negotiated between the House and Senate by Senate Majority Leader Tom Takubo, R-Kanawha, and Deputy House Speaker Matthew Rohrbach, R-Cabell, both physicians. Explaining the bill Saturday, Rohrbach said that even though there have been changes to co-pays and deductibles, premiums for PEIA have not increased for nearly 12 years.

According to Rohrbach, PEIA will be $154 million in the hole if changes are not made to restore PEIA to an 80/20 plan as required by statute. That deficit would grow to $424 million by 2027, or 10 percent of the state’s general revenue budget. According to figures from the Senate Finance Committee, SB 268 would provide $76 million in savings in year one and more than $500 million in savings by 2027.

Rohrbach said SB 268 would keep PEIA solvent and help improve reimbursement rates for in-state hospitals and health care providers to ensure they keep accepting PEIA plan participants.

“Failure to act is not an option,” Rohrbach said. “We have got to fix this plan, or we’re not really getting the benefit to our employees because they’re not going to be able to be seen…We simply cannot go any longer with the current system that we have without financial insolvency looming by 2027. We have to rescue this plan.”

The House amended the bill Saturday to include the provisions of Senate Bill 577 approved by the House Friday, which reduced the co-pay cap on insulin to $35 and devices to $100, and permitting purchase of testing equipment without prescription.”

Democratic House members offered several unsuccessful amendments to limit the effect of the return to a 80/20 plan and to either soften the changes to spousal coverage or return spousal coverage to the current opt-in plan. If the state returns to an 80-20 match beginning in July, premiums could increase by 26 percent for employees and 25 percent for employers.

“When we have $2 billion in surplus, when we have money to fix about whatever issue we can, we’re going to spread the pain and that doesn’t make sense to me,” said Delegate Joey Garcia, D-Marion. “It does not make sense to me…We could do this differently. We could find another way if we wanted to.”

“This has been described as a painful process, but the pain that you all feel today and I feel today will diminish greatly after this vote, but the pain of…230,000 public workers in West Virginia will increase,” said Delegate Ric Griffith, D-Wayne. “I hope you’ll understand the pain of the people who make our lives in West Virginia livable, better, and welcoming to people to come and stay here.”

“West Virginia, you have been duped,” said House Minority Whip Shawn Fluharty, D-Ohio. “Record surpluses apparently mean record raises to PEIA…For years we’ve been told how we’re going to make this a place to live, work, and raise a family, and we have a penalty for families in this bill, for being married and working. For doing the right thing. This state has been built on the backs of hardworking West Virginians.”

Supporters of SB 268 believe the premium increases will be blunted by other bills passed and approved by the House Saturday, including a $2,300 pay raise for executive branch public employees paid out of the general revenue budget, as well as teachers, school services personnel and West Virginia State Police troopers and staff.

Senate Bill 423 passed the House in a 94-0 vote Saturday while pay raises for the remaining public employees will be included in the final budget bill. House Bill 2024, the House’s version of the budget bill, passed Saturday in a 87-7 vote. HB 2024 sets the general revenue budget at $4.642 billion, a 5 percent increase from Senate Bill 150, the state Senate’s version of the budget, at $4.399 billion, but HB 2024 is also a nearly 5 percent decrease from the governor’s introduced budget of $4.884 billion.

Supporters of SB 268 also believe the tax cuts included in House Bill 2526, as amended by the Senate last week, would also blunt the premium increases. The House concurred with the Senate’s changes to the bill in a 89-4 vote Saturday, sending it to the desk of Gov. Jim Justice.

The compromise bill would return approximately $750 million to taxpayers annually by cutting personal income tax rates across the board by 21.25 percent, providing a 100 percent rebate on tangible personal property taxes, providing a 50 percent rebate on small businesses on their tangible personal property taxes for machinery/equipment and inventory, and a 100 percent homestead exemption for veterans with a 90 percent-100 percent service-related disability. HB 2526 also includes a formula for phasing out the personal income tax.

SB 268 is opposed by a coalition of unions representing public employees, including the West Virginia AFL-CIO, the West Virginia Chapter of the American Federation of Teachers, the Communications Workers of America, the West Virginia Education Association, and West Virginia State Police Troopers Association, and the West Virginia School Service Personnel Association.

These groups held a press conference Friday in front of the House chamber. Citing an annual state employee salary between $23,000 and $38,000, a monthly premium increase of $208 would be $2,494, resulting in a $193.96 loss of pay even with the $2,300 salary increase.

“We encourage policy makers to slow down; slow down to listen to the most important stakeholders – and that’s the plan participants – so we can make sure this bill provides real solvency for PEIA instead of reducing benefits and kicking people off the plan,” said WV AFL-CIO President Josh Sword.

“You are forcing these families who are already living paycheck to paycheck to make a choice of paying for healthcare or putting food on their tables,” said Joe White, executive director of the WVSSPA. “The state won’t save a dime if these families have to move from West Virginia in order to provide for their families.”

PEIA insures more than 230,000 state employees, local government employees and retirees including more than 31,000 non-state employees, such as municipal employees.