FISCAL NOTE



FUND(S):

2180

Sources of Revenue:

Special Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


This bill permits qualified volunteer firefighters to be covered by the state's public health insurance plan. The bill also adds "volunteer firefighter" to the definition of employee and "volunteer fire company" to the definition of employer and permits the payment of the employer's portion of the costs relating to plan to be paid from funds available to volunteer fire companies. Allowing the access of volunteer firefighters to the WV Public Employees Insurance Agency health and drug insurance plan will not increase any cost directly to the agency. The cost of premiums will be borne by the volunteer firefighter and in those cases where the volunteer fire company has sufficient revenues allocated, the volunteer fire company. PEIA may have to perform some administrative duties in the establishment of a separate premium table for firefighters based upon the experience of their insurance pool, but this is within the normal course of business for the agency. However, due to the complexity of determining coverage eligibility, enrollment, premium payment, coverage changes and termination of coverage the PEIA would recommend that a central organization such as the State Fire Marshall handle the benefit coordination functions of the volunteer fire companies. It should be noted that there is a significant potential for adverse selection with passage of this legislation. Adverse selection dictates that only those individuals that need or require medical services will be the ones to take advantage of this program. This instance would experience higher claim utilization thus incurring higher medical claim costs that would drastically skew the claim experience for a relatively small insured pool. The only recommendation that PEIA may make on this bill is that the eligibility should be restricted to those volunteer firefighters who have served a certain period of time, at least one if not two years of service prior to enrollment. This would reduce any possible adverse selection that may occur by persons volunteering to receive health care coverage and once thier immediate medical needs are satisfied leaving the volunteer fire company or cancelling coverage. At the current time PEIA is unable to estimate the actual number of voluntary firefighters who would be eligible to enroll or to estimate the financial impact that would result until an actuarial analysis is conducted.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2008
Increase/Decrease
(use"-")
2009
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
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):






Memorandum






    Person submitting Fiscal Note: Chip Myers
    Email Address: CLIFFORD.M.MYERS@WV.GOV