PEIA board approves 3% rate increase for 2027

By: Lori Kersey for West Virginia Watch
www.westviriginawatch.com
West Virginia state employees will see another increase in their health insurance costs beginning this summer.
The finance board for the West Virginia Public Employees Insurance Agency on Thursday approved 3% rate increases for employees, employers and retirees during the 2027 fiscal year, which starts in July 2026.
The board last month held a series of public hearings around the state about its plan to increase costs again this year. The board approved the plan as presented during its October meeting, with no changes.
For state employees, a monthly spousal surcharge will increase by an average of $200 per month. The surcharge is for families that have a spouse who chose a PEIA plan despite having the option of a health insurance plan offered by their own employer.
PEIA director Brent Wolfingbarger said the spousal surcharge increase was the most contentious topic during the meetings. Wolfingbarger said state law requires PEIA to charge families the cost of the actuarial value of the spouse’s plan.
“The proposed spousal surcharge increase of $200 is mandated based on the opinions given to us by our actuaries,” he said. “So the Legislature has established this policy, and if any changes are to be made, that would be a legislative decision to make.”
An employer administrative fee will increase by $2.50
Non-state agencies would be required to have at least half of their employees enrolled in a PEIA health plan.
In July, PEIA raised rates by 14% for state employees and by 16% for local government employees. Retirees also saw a 12% increase in premiums.
PEIA leaders have said that the rising cost of health care – particularly inflation on prescription GLP-1 drugs that treat obesity and diabetes – are a major driver of the rate increases.
Leaders have also pointed to a report from the firm BDO that indicated that the sharp rate increases that public workers have had in recent years had been caused in large part because between the years 2018-2022, rates had been frozen. Former Gov. Jim Justice had vowed not to increase the rates during his time as the state’s chief executive.
Speaking to the finance board Thursday, Dale Lee, co-president of Education West Virginia, said the Legislature should take PEIA’s rising costs seriously and make the spousal charge more fair for state employees.
“I know of people, service personnel, who are making in the first or second tier and paying the same amount for spousal surcharge as the superintendent, making $180,000 a year,” Lee said. “There’s something wrong. There’s something philosophically wrong, in my opinion.”
Lee thanked the board for researching the spousal charge so that the public knows what the answer is.
“Now we know where to turn our attention, and we turn our attention to the Legislature, because that has to be changed,” Lee said. “There are other things that have to be changed in this we are more than happy to sit down and start the discussions, be a part of the discussions, be a part of the solutions.”
West Virginia Watch is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. West Virginia Watch maintains editorial independence. Contact Editor Leann Ray for questions: info@westvirginiawatch.com.