CHARLESTON, W.Va. — Nearly 5,000 West Virginia local government health insurance policyholders could face a 24% premium increase next year, prompting warnings from county officials that rising costs could strain budgets and drive employees away from public service.
The proposed increase would affect approximately 32% of local government policyholders enrolled through the W.Va. Public Employees Insurance Agency (PEIA). Most other local government plans face a proposed 4% increase.
The W.Va. Association of Counties is urging the agency to reconsider the larger increase or phase it in over at least two years.
“Counties are running out of revenue, with skyrocketing jail costs and other obligations making it increasingly difficult to cover these PEIA premium increases,” Mercer County Commissioner Greg Puckett said in a statement Wednesday. “We will end up losing good employees because of this.”
The changes, which have not been approved, would take effect July 1, 2027.
County insurance costs have climbed
According to PEIA’s fiscal year 2028 proposal, 4,959 of the agency’s 15,611 local government policyholders are enrolled in the Gold High Deductible Health Plan, which generally offers lower premiums in exchange for higher deductibles and out-of-pocket expenses.
The association says many employees chose the plan for its affordability.
Local government insurance premiums have already increased approximately 66% when annual increases from fiscal years 2023 through 2027 are compounded, according to the agency’s historical figures.
The amount employees would pay under the new proposal depends on how their employers divide premium costs between workers and local governments.
The association questions whether the agency has had sufficient time to evaluate changes implemented July 1, including a 5% gold plan premium increase and adjustments to deductibles and out-of-pocket expenses.
PEIA projects $10 million shortfall
The agency estimates that medical and prescription expenses in its Non-State Fund will exceed premium revenue by approximately $10 million in fiscal year 2027, primarily because of the Gold plan’s financial performance.
The plan’s projected medical loss ratio is 119.4%, meaning it is expected to incur approximately $1.19 in medical claims for every dollar collected in premiums.
The agency is also considering benefit modifications that could increase Gold plan deductibles and maximum out-of-pocket expenses.
Jonathan Adler, executive director of the Association of Counties, acknowledged the financial problem but called for greater transparency.
“We understand that the proposed 24% increase for the Gold plan reflects claims that have far outpaced premium revenue,” Adler said. “We ask that the Board provide quarterly reports detailing these disparities between claims and revenue so local governments can better anticipate and prepare for possible rate increases. We need this information on a more regular basis.”
Counties seek relief from participation rule
The association is also asking the agency to delay enforcement of a requirement that participating local government employers have at least 50% of their employees enrolled in the program by June 30, 2027.
County officials fear higher premiums could discourage enrollment and make it difficult for some employers to maintain eligibility for coverage.
The association wants state officials to explore financial relief through available agency and retiree health benefit resources, subject to legal restrictions, and to give counties more time to adjust to the proposed changes.
Public hearings continue Thursday
PEIA will receive public comments on the proposed changes at four remaining hearings. Each begins at 6 p.m., with registration opening at 5:30 p.m.
- Thursday, Nov. 12: Virtual hearing through Google Meet or by telephone at 941-800-3158, PIN 432 061 428#.
- Monday, Nov. 16: Shepherd University, Student Center, Storer Ballroom, 210 N. King St., Shepherdstown.
- Tuesday, Nov. 17: West Virginia Capitol Complex, Building 3, 1900 Kanawha Blvd. East, Charleston.
- Thursday, Nov. 19: River City Restaurant, first floor, 1400 Main St., Wheeling.
The PEIA Finance Board is expected to meet again on December 3, following the hearings. Additional information is available through the West Virginia Public Employees Insurance Agency.