FISCAL NOTE
Date Requested: January 20, 2026
Time Requested: 04:51 PM |
| Agency: |
Public Employees Insurance Agency (PEIA) |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2935 |
Introduced |
SB526 |
|
|---|
| CBD Subject: |
Insurance |
|---|
|
FUND(S):
PEIA Basic Insurance
Sources of Revenue:
Special Fund
Legislation creates:
Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to clarify PEIA's cost sharing provisions. As understood by PEIA, this bill would reset the 80/20 cost sharing for the State fund beginning with FY 2028 on July 1, 2027 to include both premium and benefit changes from the FY 2027 plan year that begins on July 1, 2026. It also indicates that any portion of employer funding that exceeds 80% in a given plan year can be offset by an equivalent percentage reduction in the employers’ necessary share the following year, but no lower than a 70% share. It also caps the employees share at 20%. Based on the current five-year plan pass December 2025, PEIA estimates this will increase the employer share of funding PEIA benefits. The increase is due to the inclusion of benefit changes, causing the employer premium share to increase. These employer share funding increases are projected to be $13 million in FY 2028, an additional $13 million in FY 2029, an additional $13 million in FY 2030, an additional $44 million in FY 2031, and an additional $34 million in FY 2032 for a total increase of $117 million above the FY 2027 baseline budget during those five plan years. Using the current 5 year plan, the average annual amount of the increase would be $23.4 million.
PEIA is uncertain what process it would need to implement in the event the employer share would go below 80% to offset an increase above that percentage in a previous year. In that situation, because the employees' share is capped at 20% and there does not appear to be a mechanism that would allow the employees' share to ever exceed 20%, it appears there would be a shortfall in PEIA's funding to cover the growth in employees’ health insurance expenditures for that one year.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
23,400,000 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
23,400,000 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The increase is due to the inclusion of benefit changes, causing the employer premium share to increase. These employer share funding increases are projected to be $13 million in FY 2028, an additional $13 million in FY 2029, an additional $13 million in FY 2030, an additional $44 million in FY 2031, and an additional $34 million in FY 2032 for a total increase of $117 million above the FY 2027 baseline budget during those five plan years. Using the current 5 year plan, the average annual amount of the increase would be $23.4 million.
Memorandum
PEIA is uncertain what process it would need to implement in the event the employer share would go below 80% to offset an increase above that percentage in a previous year. In that situation, because the employees' share is capped at 20% and there does not appear to be a mechanism that would allow the employees' share to ever exceed 20%, it appears there would be a shortfall in PEIA's funding to cover the growth in employees’ health insurance expenditures for that one year.
Person submitting Fiscal Note: Jason Haught
Email Address: jason.a.haught@wv.gov