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Mike Adkins, Deputy Director of Operations
michael.j.adkins@wv.gov (304) 558-7850, ext. 52630 Jason Haught, Chief Financial Officer Keith Huffman, General Counsel Gloria Long, Deputy Director Shelda Martin, Medical Director Twila Neil Jewl Hammack Cindy Dotson Tom Harper LETS EMAIL THEM ALL A PIECE OF OUR MIND!!!!!!
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Posted in: Uncategorized
peiawatch
January 15, 2009
Please see proposed and projected PEIA premium increases of up to 64% over the next 4 years further down in this post. I’ve also done some computations to show how much this costs in dollars, as well as percents. Below is part my letter to PEIA in response to their proposals in Nov. 2008, and just before their vote with a couple of corrections added. They voted on Dec.4 for the increases in premiums. The original proposal was the increase in premiums this year or the loss of benefits or combination, not both. They voted to increase premiums for actives and nonMedicare Retirees, and to increase the OOPM for Medicare retirees. But will we face and decrease in benefits a few years from now? My greatest concern the Medicare Advantage Plan, and it’s limitations even as a Private Fee For Service Plan when compared to Original Medicare, and the possibility that it is soon to be bid as a PPO, probably and most assuredly a more limited network.
More legislative oversight of PEIA Finance Board is desperately needed.
We need to ask that the legislature request the PEIA board to give them all complaints and comments (on PEIA, problems, their proposals, changes, and Medicare Advantage, etc. ) ,filed in the last 2 + years back to Nov. 1, 2006, when they first proposed switching to Medicare Advantage. There have been letters, petitions, emails, faxes, telephone calls and public hearings complaining about all the changes (in benefits in general both in regular PEIA and Medicare Advantage, and problems with PEIA). They need to consider getting the original transcript from the public hearings, not a condensed summary. Summaries of all theses complaints can not begin to show all the problems, and concerns, and the numbers of people with multiple complaints and concerns.
Please note excerpts my letter below were written before the vote, and PEIA made some changes in Dec. 4 meeting, as noted below. Note also that these percentage increases are now the average for each group, as PEIA has also increased the difference between nonsmoker and smoker rates, but has not computed and posted the rates for each group. While the premium increase remains on average 9 % for actives and 11% for non Medicare retirees the increase will be slightly smaller for nonsmokers this year and slightly higher for smokers. Also Medicare PEIA retires were given 50% increase to $750 in Out of Pocket Maximum rather than this year’s premium increase. This was not even one of the proposals in the Public Hearing Presentation! For the oldest and sickest, this is equivalent to a 45% increase in premiums. (This will be marked in text for footnotes 2 & 3.)
Excerpts from letter:
Benefits are not as promised when hired: I object to the proposed premium increases, of 9 % and 11% for retirees, and projected total compounded increases of 57% for employees, and 64% for retirees, increases varying, but usually over $100 per month for families by the 4th year. These ever increasing premiums, were not part of the benefit package promised and given when I began employment. I believe most of the worst of this started in about 1999 or just before. It is a bait and switch to employ people and provide certain retirement benefits, and then take a lot away after they retire, or after they have worked for them almost 20 years. Since employees had small salaries, we had good insurance instead. The low salaries not only affect our pensions, but our Social Security. Also our pensions do not have any protection against inflation and do not have cost of living. People planned their employment and lives around this promised benefit. In effect by raising premiums, you are reducing our pensions, because now we have to spend a large part of our already small pensions to pay for these extra premiums and copays.
Increases for retirees 2, 3 are 11, 17, 13, and 12 percent over 4 years. These increases compound from year to year, and therefore would add up to a 64 percent increase in premiums ! With little computation one finds for a non-Medicare retiree currently paying $208 monthly, premiums would increase to about $341 per month ( $1692 more yearly by the beginning of the fourth year), for yearly premiums of about $4093 (higher for fewer years of service). Premiums for Medicare retirees increase by the same percentages. This was a plan that used to be free. They do not get cost of living increase, so the premiums should not be increased.
For active employees2 the increases are 9, 14, 13, and 12 percent, a total premium increase of 57 percent by the start of 4th year. Active employees with incomes starting at 20, 30, 36 and 42 thousand in PEIA PPB Plan A Family Preferred Plan see increases over the 4 years of up to $930, $1094, $1279, $1593 more per year respectively, for compounded yearly total premiums of about $2362, $3012, $3516, and $4389. The monthly premiums would have gone up in each income bracket as follows: from $136 to $213, $160 to $251, $187 to $293, and from $233 to $365 per month. Those in the lowest part of each bracket will be paying over 10 percent of their income just for the premiums!
(See attachment for more detailed examples)
Attachment:
It shows increases for retirees 2, 3 of 11%, 17%, 13%, and 12% over the next 4 years for a total of a 64% compounded increase over the next 4 years. I have been told the increases compound from year to year.
For active employees, 2 the increases are 9%, 14%, 13%, and 12% in each of the next 4 years for a total of 57% increase over the next 4 years as each year is an increase on the previous year.
Retirees –Non Medicare 2
To clarify if you now pay $208 a month as a retiree it will go up to over $341 per month as it compounds. That’s and extra $1692 in premiums per year. You’ll be paying a total of over $4093 in premiums per year during the 4th year.
Medicare Retires 3 – Please use the 4 proposed yearly increases to compound your own rates.
Active employees 2,
For those who state employees your premium has been based your salary and the plan you select. If these increases are applied the same in each category, then we can apply this to a few examples. These examples are for those For Examples for those enrolled in PEIA PPB Plan A Preferred Family Plan
Active Employees earning 20 to 30 thousand 2
For those making 20 to 30 thousand per year and currently paying $136 per month, the premium would increases to about $213 per month over the 4 years . That’s an extra $930 per year. They’ll be paying $2562 per year total.
Active employees earning 30 to 36 thousand a year 2
Currently state employees earning 30 to 36 per year enrolled in the PEIA PPB Plan A Preferred Family Plan pays $160 per month.
However, applying the listed increases would increase this to about $251 per month.
That’s an extra $1094 per year. They’ll be paying a total of $3012 per year.
For those making 36 to 42 thousand 2 in that same plan and now paying $187 per month, the premium would increase over $293 per month.
That’s an extra $1279 per yr.
They’ll be paying a total of about $3516 per year by year 4.
For those making 42 to 50 thousand per year 2 in the same plan and now paying a monthly premium of $233 per month , the premium would increase to over $365 per month.
That’s an extra $1593 per yr.
They’ll be paying be paying a total of $ 4389 per year.
Those covered who are at non-state agencies (cities, counties, towns, etc.) should check the presentation for their percentage increases.
Proposed decreases in benefits
Foot notes:
2. Note, since the Dec. 4, 2008 vote, these percentage increases are now the average for each group, as PEIA has also increased the differential between nonsmoker and smoker rates, but has not computed and posted the rates for each group. While the premium increase remains on average 9 % for actives and 11% for non Medicare retirees the increase will be slightly smaller for nonsmokers this year and slightly higher for smokers. The increase is suppose to be maybe 3% less for nonsmoking actives this year, bring it down to 6%, but that is not for sure. If so, the proposed and projected increase whom still be almost 53% over the 4 years for non smokers, and much more for smokers. The 11% increases in premiums for non Medicare retirees will be slightly less for non smokers, but PEIA can not tell how much less. Even it is 3 percent less, that still makes next year’s increase 8%, and the compounded proposed and projected 4 year increase in premiums about 60% for now smokers, and more for smokers.
3. Also Medicare PEIA retirees were given 50% increase to $750 in Out of Pocket Maximum rather than this year’s premium increase. This was not even one of the proposals in the Public Hearing Presentation! For the oldest and sickest, this is equivalent to a 45% increase in premiums. (This will be marked in text for footnotes 2 & 3.) Smokers still get the additional increase in premiums, due to the increased differential for smokers. For nonsmokers the projected increase in premiums during the following 3 years is a 48 % increase in premiums, in addition to the 50% increase in OOPM. For the oldest and sickest this is like a 95 % increase in premium in four years, when taking into account the increase in OOPM. For smokers the increase is even higher. The increase in differential causes a 15.7% increase this year. The increase over the following 3 years, for smokers and nonsmokers alike, causes their premium increase over the total 4 years, to be 71%, and that’s before taking into account the increase in out of pocket maximum. Adding this to the increase in OOPM to the increases in premiums, it functions like a 119% in increase in premiums over the 4 years. By July of 2012, these increased premiums, plus additional OOPM, will be 219 % of their current premiums, over double what they currently pay.
Note: Copays, coinsurance, deductibles, and increases in OOPM are not taken into account, when figuring employee and retirees share of premiums when compared to the state’s share. This is all cost shifted to employees, when ever these are raised.