CHARLESTON — Wheeling Hospital, which indicated months ago that it would stop taking patients with state-provided insurance plans, now intends to accept those patients because of recent changes in the reimbursement rate.
“They will be fully participating in PEIA,” said Jim Kaufman, president and chief executive of the West Virginia Hospital Association.
On Friday, Gov. Jim Justice signed Senate Bill 268, which makes a range of changes to the Public Employees Insurance Agency, out of concern that the agency faces growing financial stress.
Before the most recent legislative session began, Wheeling Hospital announced it would move toward not accepting PEIA patients because of the low reimbursement rate. That raised alarm that other medical providers would do the same, and one aspect of the bill signed by the governor raises the reimbursement rate to 110% of what Medicaid pays.
After Friday’s bill signing, WVU Medicine put out a statement put out a statement assuring continued service: “We are grateful to Governor Justice and the West Virginia Legislature for stabilizing and improving PEIA. Because of their work, Wheeling Hospital will be able to continue participating with PEIA.”
Kaufman also expressed gratitude toward state officials who moved toward the higher reimbursement rate.
The reimbursement rate for West Virginia medical providers has long been an issue. The state-defined reimbursement rate for PEIA had amounted to 59% compared to the Medicare reimbursement rate.
“That was a major fiscal challenge,” Kaufman said. “We are very thankful the governor and the legislature addressed that access-to-care problem so the hospitals have the resources they need to recruit providers and nurses.”
He said, though, that economic challenges for West Virginia hospitals are likely to continue.
“Right now the average hospital in West Virginia is looking at a -7% operating margin,” he said. “And I do think you’re going to see other hospitals continue to look at how to cut costs. That was why Wheeling originally announced they were not going to accept PEIA. You may see other changes, but I don’t think it’s going to be specific to PEIA in the future.”
One way the recently passed PEIA legislation attempts to get a handle on finances is by returning insurance costs to an 80-20 split between state government and employees.
A return to 80-20 will alleviate financial pressure on state government, but it will mean a significant and rapid adjustment for employee out-of-pocket costs, estimated to be up to a 26% premium increase.
Another lightning rod in the bill would require spouses who have other insurance options to buy into the program if they want to participate in PEIA. That’s estimated to be a $147 monthly cost.
Lawmakers who voted in favor of the bill said those changes needed to be made to shore up the program and ensure medical options continue to be available for those enrolled.
“Have we really given a benefit if you get a card that nobody will take? We have to stabilize this plan for the hard-working people of the state of West Virginia,” Delegate Matthew Rohrbach, R-Cabell, said earlier this month on the day the PEIA legislation passed.
At the time, Rohrbach said that without legislative action there’s no question other medical providers would have followed Wheeling Hospital in declining PEIA coverage. “Failure to act was simply not an option,” he said.
But Rohrbach acknowledged an ongoing, challenging balance among the costs for insured state employees, taxpayers and medical providers.
“Certainly I’m concerned that long-term our providers are going to continue to take 100% of Medicare when commercial insurance plans are typically between 150 and 180%,” he said. “So this certainly doesn’t fix the problem with the providers. It simply puts a Band-Aid on it.”
