Teachers watch in the gallery of the West Virginia Senate on March 1, 2018, during a nine-day teachers' strike. Photo by Will Price/WV Legislature

It was the middle of fall and Christy Cardwell’s migraines were starting to be too much for her. 

She was rear-ended in a car accident in September, and was working with insurance providers in the hopes of reaching a settlement. But her migraines, which were a problem for years, started coming more frequently. She also noticed that she was beginning to lose some sensation in one of her hands, first in the fingertips, then the palm. 

But months later, Cardwell still hasn’t had the MRI her doctor recommended. As a public school teacher in Wyoming County, she’s insured through West Virginia’s Public Employees Insurance Agency, or PEIA. And the hospital told her that before she could receive the test she would have to pay hundreds of dollars upfront. That was money that Cardwell, a mom and a teacher for the past 24 years, didn’t have. 

She eventually got some relief by working with a chiropractor, but was dismayed by what she has seen as a big change in her insurance coverage.

“With what is supposed to be the gold standard of insurance, I should not have to pay hundreds of dollars just to see why I am having migraines,” she said. 

Christy Cardwell (center, holding sign), with other teachers during the 2018 teachers’ strike. Photo courtesy Christy Cardwell.

These frustrations are not unique to Cardwell. PEIA insures more than 200,000 teachers, state employees, city workers, corrections and law enforcement officers, and other public employees across West Virginia. For years, the agency has dealt with financial crisis after financial crisis and currently faces a $376 million budget shortfall by 2027. 

For the past five years, the agency’s finances and potential insurance changes have been frozen; that’s when Gov. Jim Justice pledged to fix PEIA and allocated $105 million in temporary funding to keep the agency operational without increasing costs for public employees. But with that money set to be used up by 2024, the agency must now grapple with multiple crises that it has avoided addressing. 

And as issues mount, the potential costs are coming down hardest on state workers who argue that they cannot afford for PEIA to go unaddressed. Now, as lawmakers eye ways to shore up the struggling agency, raising costs further and decreasing benefits are two options that legislators say must be considered. 

“I thought we had some time before things got bad,” Cardwell said. “But we didn’t.” 

An employee insurance agency in crisis 

Many of the issues facing PEIA are cyclical: increases in medical inflation and prescription drug costs, coupled with market changes, raise the cost of maintaining the insurance. This causes PEIA’s costs to go up almost annually, with the agency requiring a near-constant increase in revenue to remain above water.

Controversies over the agency’s insurance picked up in the 2010s, as people covered through PEIA expressed frustrations with benefit cuts. In 2016, for example, PEIA’s Finance Board approved a $120 million cut in benefits after the Legislature failed to agree on a plan to provide more funding. Teachers have since noted that the cuts have left them paying more in insurance deductibles, out-of-pocket maximums, and copays, making it harder for them to stay on top of their health needs.

“The questions [PEIA faces] are the same, I think as what we faced 30 years ago, but the magnitude of them may be worse,” said Emily Spieler, a law professor at Northeastern University School of Law and a founding member of PEIA’s Finance Board in the 1990s. 

The issue has led to a situation where an outcry over PEIA happens every few years, particularly at moments when the agency proposes cutting benefits in order to stave off significant financial issues. PEIA was a major driving factor behind the 2018 teachers’ strike, when Cardwell and roughly 20,000 other West Virginia teachers walked out of the classroom and converged on the Capitol. Shortly before, the agency was considering possible changes to PEIA’s salary tiers that would have required many public employees to pay higher premiums. 

The nine-school-day strike prompted Gov. Jim Justice to pledge a fix and announce a PEIA task force to propose solutions. The 29-member group went on listening tours across the state, and ultimately released a set of recommendations to aid the insurance agency. Two ideas in particular remain strongly supported by advocates: increasing revenue for PEIA through dedicating new tax money to the agency, and changing a state law that currently requires an 80/20 split in insurance costs between employers and employees to allow the state (as an employer) to take on a larger percentage of costs. 

But the task force’s recommendations were not adopted, and in the years since PEIA has effectively been kept in stasis. The bits of legislation that have been proposed have largely revolved around cuts to PEIA, particularly the prospect of removing some employed spouses from coverage. There has also been frustration with the state’s budget, which has remained relatively flat with artificially low-revenue projections and few increases in agency funding. West Virginia’s current budget surplus, to the extent that some experts believe it exists, is currently being used to justify tax cuts, not increases that could help PEIA and other services.  

“It’s extremely frustrating,” said Dale Lee, the president of the West Virginia Education Association and a member of the PEIA Task Force. “It is disappointing that even though there were representatives from the Senate and the House on the task force, they haven’t taken up a bill to provide the necessary means to come up with a long term solution.” 

Lawmakers have said they intend to prioritize PEIA during the current legislative session. But beyond their day one effort to address urgent issues with hospital reimbursement, the exact plan they will pursue remains unclear. 

State politics aside, the deeper issues facing the state insurance program are not unique to West Virginia, and these problems emerged well before the strike. Health care costs are rising nationally, and in interviews, several experts said that ultimately true reform must start at the federal level.

“There’s no fixing health care in this country until Congress deals with it, you just manage the crisis,” said Tom Susman, a former PEIA director who led the agency in the early 2000s.

Right now, that crisis is likely to get worse. Agency projections for 2022-2026 show that PEIA could be below its required reserves by 2025, and shifts in the market could further affect the agency in the coming years. While Justice has maintained that premiums will not rise while he’s governor, he’s due to leave office in 2024. 

Frustrations mount as future remains uncertain

Like Cardwell, Krista Antis remembers when PEIA’s insurance was better. Growing up, she watched a close relative climb the ranks in the Department of Administration. When the state moved to offer employee insurance through PEIA, it was a good thing. 

“Apparently it was a really great insurance package back then,” she said. “But now it has been eaten away over the past 30 years.”

Krista Antis and her son Davis at the 2018 West Virginia teachers’ strike. Photo courtesy Krista Antis.

Antis, who has been a teacher for 12 years, has seen colleagues, some of whom are teachers married to other teachers, struggle to afford basic needs or choose between paying utilities and health care. And she’s heard stories of just how expensive things can be even with PEIA insurance, including ER visits that turn into hospital stays resulting in hundreds, sometimes thousands, of dollars in costs.

Antis has also struggled to balance her family’s medical needs with PEIA’s coverage. But some of the burdens were lessened by being able to cover some costs under her young son’s Medicaid.

But that isn’t how the system should work, she says. “You shouldn’t need to have a disabled family member on your insurance just so that Medicaid can cover your out-of-pockets.” 

As of now, it isn’t clear what action lawmakers will take to address PEIA. But while they figure it out, the insurance continues to be an issue for employees across the state. And with so many vacancies at state and municipal agencies, advocates argue that PEIA’s decline further complicates the state’s numerous staffing crises

In late February, West Virginia teachers will commemorate the five-year anniversary of their statewide strike. And as that day approaches, there is frustration that the issues teachers left the classroom to address still remain. 

But beyond that, there is growing concern about what they, and other public employees, may be asked to shoulder in the coming years. 

For Antis, while the problem may be complex, her one expectation for PEIA is fairly simple. “If premiums are going to go up, my health care better not get worse,” she said.

P.R. Lockhart is Mountain State Spotlight's Economic Development Reporter.