W. Va. Seeks Fix for Soaring Health Insurance Costs

By | January 3, 2007

Lawmakers and health care advocates in West Virginia must confront a stark reality: more than one in two residents either get their insurance from the government or have no insurance at all.

Next year, the Legislature will face the soaring cost this situation, and proposed reforms range from requiring large employers to pay more for workers’ health care to trying to wipe out unhealthy habits.

“We need to improve the health status of West Virginians,” said Perry Bryant, executive director of West Virginians for Affordable Health Care.

That means addressing the number of uninsured Mountain State residents, as well as those who rely on publicly funded insurance, which can shift the cost of treatment to the private sector, Bryant said.

West Virginians primarily get their public insurance from three sources: the Public Employees Insurance Agency, a state program; Medicare, a federal program for the elderly; and Medicaid, a federal-state program for low-income residents that includes a component designed to provide coverage for children from uninsured families.

According to PEIA, about 200,000 people – public employees, teachers and their dependents – are covered by its policies.

The Department of Health and Human Resources estimates that 300,000 West Virginians are covered by Medicaid, although some estimates run as high as 370,000.

And according to the most recent data from the Social Security Annual Statistical Supplement, about 351,000 West Virginians are covered by Medicare, although some of them are also covered by other government plans like PEIA.

All told, that’s roughly 800,000 of the state’s 1.8 million residents who rely on either the state or federal government for their health care. Combined with the roughly 322,000 West Virginians the U.S. Census Bureau estimates are without health insurance, that means a minority of state residents are covered by private insurance plans.

State officials say the percentage of residents relying on public insurance is among the highest in the nation, and one consequence of that is private insurers are faced with higher costs because government insurance programs set health care reimbursement rates below the cost of treatment, said Sen. Evan Jenkins, D-Cabell.

“The cost shift is a significant problem, and West Virginia’s private employers are seeing increases in their health insurance premiums as a result,” said Jenkins, who is the executive director of the West Virginia Medical Association.

But that’s preferable, Jenkins said, to the cost shift resulting from uninsured people, who often put off treatment until a problem becomes severe, leading to the most expensive care possible.

Jenkins wants to see government insurers – state and federal – pay more for treatment, but in the short term, moving uninsured people to public insurance is a workable stopgap solution.

“We can’t stop there, though, and assume that simply putting more people on government health care programs is the best result,” he said.

The cost of public insurance, though, doesn’t only affect private insurers. In 2005, West Virginia spent $2.3 billion in state and federal matching funds on Medicaid alone.

“That’s a tremendous drain on state coffers,” said Delegate Tim Manchin, D-Marion, vice chairman of the House Pensions and Retirement Committee. “We devote more and more of our budget to Medicaid spending.

“As long as you have it there, you don’t have it for infrastructure, for economic development, for ways to bring jobs to West Virginia.”

Manchin wants to see the Legislature expand the minimum wage to cover virtually all employees in the state, which he said will go toward making people less dependent on government. And like a number of other lawmakers, he wants to see a discussion about the merits of a program aimed at getting large employers to pay greater shares of their workers’ health insurance.

“We’ve got a problem if people are working full-time jobs and still not getting health benefits,” he said.

A similar bill, called a “Fair Share” law by proponents, failed to pass the Legislature in the 2006 session.

When it comes to long-term solutions, though, many in the state say the answer ultimately lies in changing the lifestyle habits of residents.

West Virginia ranks high in negative health indicators like obesity, lack of exercise and smoking. A number of voices around the state, ranging from legislators to Chamber of Commerce President Steve Roberts, have said the key to reducing health care costs in West Virginia lies in changing the way residents take care of themselves.

Bryant wants to see the agencies that provide public health insurance team with major private providers such as Mountain State Blue Cross Blue Shield to develop a comprehensive plan aimed at promoting healthy habits.

“The best way to reduce Medicaid costs is to help Medicaid recipients improve their health,” he said.

Topics Virginia West Virginia

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