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PEIA premiums won't rise, but other costs may

CHARLESTON, W.Va. --- State and public school employees covered by Public Employees Insurance Agency plans will not see premium increases next year - but probably will see new or increased co-payments for prescription drugs and for a variety of medical services, under a tentative 2012-13 plan presented Tuesday to the PEIA Finance Board.

"We've tried to keep the premiums down as low as we can," PEIA executive director Ted Cheatham said of the proposed coverage plan.

Overall, the proposed plan shifts about $32.9 million of costs from PEIA to insurees, primarily through new or increased co-pays.

That includes a proposed increase in co-pays for prescription drugs, to provide a cost-shift of about $20.4 million.  

The proposal includes raising the co-pay for generic prescription drugs from $5 to $8, brand-name prescriptions on the preferred drug list from $15 to $50, brand-name non-preferred drugs from $50 to $85, and specialty drugs from $50 to $100.

Overall, the higher co-pays would work out to an average cost of about $432 a year per policyholder, or about $36 a month, Cheatham said.

However, unlike premium increases, co-pays are directly tied to usage of medical services and prescription drugs.

"It's who uses the services who pays," Cheatham said.

The plan also proposes savings of just under $1 million a year by eliminating PEIA coverage for massage therapy, and for acupuncture treatments.

It also shifts coverage costs by increasing or imposing co-pays for a variety of medical procedures.

Those include increasing co-pays for emergency room visits to $100, and increasing co-pays for visits to urgent care facilities to $25.

The proposals includes new $500 co-pays for a variety of procedures, including knee or hip replacement surgeries, shoulder surgeries, gastric bypass surgery, spinal procedures and for medically necessary dental procedures.

Cheatham said PEIA has seen a dramatic increase in claims for knee and hip replacements, and said the co-pay is intended to encourage insurees to first try alternative treatments before undergoing surgery.

"The magic age seems to be age 60," he said of the spike in hip and knee replacements. "It seems at that age, you see a huge jump in these kinds of particular procedures."

Prior to a passage vote on the plan, the PEIA Finance Board will hold public hearings around the state next month, beginning Nov. 7 in Charleston. Other hearings are set for Beckley, Martinsburg, Morgantown, Wheeling and Huntington.

If the PEIA Finance Board adopts the proposed plan without substantive changes on Dec. 13, it will mark the second consecutive year that premiums for active employees have not increased.

Last year, the board adopted a plan with $14 a month per person premium increase - but insurees could offset the entire increase by participating in a PEIA wellness program and by verifying they had completed an advance directive for end-of-life care.

Cheatham said it initially appears that a 4 percent premium increase will be necessary next year, for the 2013-14 plan.

Reach Phil Kabler at philk@wvgazette.com or 304-348-1220.


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