Continuation of wellness program criticized
January 17, 2014
Members of a legislative committee Thursday criticized the Public Employee Benefits Program for continuing the wellness program for state workers.
"I thought we made it very clear in the Legislature that when we were cutting other things, wellness was not a priority," said Assemblywoman Maggie Carlton, D-Las Vegas, chairwoman of the Interim Retirement and Benefits Committee.
PEBP Board Chairman Leo Drozdoff disagreed, saying, "what we heard from the Legislature was that we're not anti-wellness." He said the wellness program is "part of a mix" of things added back by PEBP "based on new information." That information, Drozdoff said, included the fact that when workers were polled, only one said to end the wellness program; some 90 responded that wellness should stay.
Carlton made it clear she thinks the PEBP board ignored lawmakers.
She said it was setting a precedent that "when we have reserves, you think you can spend them on what you think you should."
"You made a decision contrary to the intent of the Legislature," she told Drozdoff and other members of the board.
Sen. Debbie Smith, D-Sparks, and Assemblyman Randy Kirner, R-Reno, agreed, saying it was frustrating to them that PEBP seemed not to understand what lawmakers wanted and did the opposite.
Kirner agreed the new information seems very positive but said that "communication is a concern for me."
Carlton conceded that lawmakers don't control the PEBP board's decisions but said lawmakers were clear they didn't want to fund it.
"Lesson learned that, when we say something, we need to make it explicitly clear," she said.
In fact, the money committees deleted the more than $6 million for the wellness program in the 2013 session. That money went into the excess reserves, but lawmakers never specifically said what it should be used for.
Those reserves have built up to a level much higher than projected during the session. With something on the order of $75 million in excess, PEBP board members agreed they had the ability to add back a number of benefits.
They did so at the board's November meeting. In addition to wellness, they raised the percentage of bills covered by the Consumer Driven Health Plan — used by most state workers — from 75 percent to 80 percent after the deductible is reached.
They dropped the deductible from $1,900 to $1,500 a year for individuals and $3,800 to $3,000 for a family. They voted to contribute $700 to employee Health Savings Accounts again this year, plus $200 for each dependent, to a maximum of $1,300. The board also voted to raise annual dental coverage from $1,000 to $1,500 a year.
That makes restoration of wellness just part of an overall package, Drozdoff said.
He and PEBP Executive Director Jim Wells said the situation has changed since the session, that data coming in shows health benefits from the wellness program including improvements in employee weight, blood pressure and cholesterol and other health measures. Those changes should reduce costs going forward, Wells said.
"I think the board felt this was a mix of things based on new information," Drozdoff said.