COMMITTEE CONSIDERS INSURANCE RENEWALS FOR FISCAL YEAR 2027

ST. THOMAS, VI — The 36^th Legislature of the Virgin Islands, led by Senate President Milton E. Potter convened into Committee of the Whole at the Earle B. Ottley Legislative Hall.  Lawmakers considered testimony concerning the Government’s medical, prescription drug, dental, voluntary worksite, retiree Medicare Advantage, live and voluntary insurance renewals for Fiscal Year 2027. Lawmakers do not vote in the Committee of the Whole and action will be taken at the next scheduled Legislative Session.

Lawmakers considered Bill No. 36-0389, An act ratifying the First Renewal of Group Life and Accidental Death and Dismemberment Insurance; First Renewal of Group Vision Insurance; Third Renewal of Group Medical Health Insurance; and the Second Renewal of Voluntary (Employee-Paid) Critical Illness Insurance, Voluntary (Employee-Paid) Accidental Injury Insurance, and Voluntary (Employee-Paid) Hospital Care Insurance. The measure was proposed by Senator Milton E. Potter by Request of the Governor.

Beverly Joseph, Chairperson of the Government Employees Service Commission Health Insurance Board delivered testimony. Joseph said that the CIGNA medical renewal for active employees and Non-Medicare retirees. Joseph stated that based on medical claims experience through June 2026, claim expenditures were equal to 92% of premium, excluding administrative and other plan expenditures. Claims cost per month decreased 6.6% over the prior year. Enrolment decreased 1.7%.  

Joseph stated that CIGNA’s initial standard underwriting calculation indicated a 17% increase. At the board’s request, CIGNA applied the historical underwriting methodology, which reduced the indicated increase to 10%. Through further negotiations, the board reduced the final renewal increase to 7%. The renewal preserves the existing plan design and prescription drug management program. Deductibles, copayments, and out of pocket maximums will remain unchanged. Based on the proposed premiums, the increase to the Central Government is approximately $9.5 Million, resulting in a total medical cost of approximately $146 Million.  The board also negotiated an additional $500,000 in wellness funding, bringing the total wellness fund to $1.5 Million for the upcoming fiscal year. Of this amount, $750,000 is designated for approved gym membership and personal training proposals. The remaining $750,000 will supports approved wellness activities, activities, and incentives.

Dental premiums are expected to increase by 6%, consistent with the contractual annual cap on premiums that the board originally negotiated. Dental claim expenditures were equal to 104% premium, excluding administrative and other plan expenses. Claim costs per employee per month increased 2% over the prior year. Additionally, Joseph stated that the Board recommended continuing CIGNA’s voluntary Accidental Injury, Critical Illness, and Hospital Care products for active employees. These products are paid for entirely by participating employees, with no cost to the Board or the Government. Rates will remain unchanged for the upcoming Fiscal Year.

UnitedHealthcare remains the only insurer offering the group Medicare Advantage option for post sixty five retirees in the territory. All post sixty five retirees are covered under one medical plan, whether they reside in the territory or stateside. Coverage is nationwide, and retirees are not required to select a primary care physician. Referrals are not required to see a specialist.  For calendar year 2027, the approved combined medical and prescription drug premium is $330.24 per person per month. This represents no increase in premiums. The pharmacy plan will remain carved out from the medical plan, and retirees will continue to receive separate medical and prescription identification cards. There will be no changes to copayments or deductibles in 2027.  Based on current cost share, the Government portion is projected at over $17 million, and the retiree portion is projected at $8.8 million. Total overall program cost is approximately $25.8 Million.

The Central Government provides basic life and accidental death and dismemberment coverage to active employees and retirees  Active employees receive $10,000 in live insurance coverage and retires receive $5,000. The benefit doubles when death results from an accident. Active employees can purchase additional life insurance through payroll deductions at no cost to the Central Government.  The contract permitted premium increases subject to a 10% premium cap in years four and five.  However, the board negotiated no premium increase for two additional years. The overall cost to the Central Government is approximately $425,000. For employee only or retiree only coverage, the cost per pay period will increase from $1.98 to $2.09, an increase of 11 cents. For employee or retiree family coverage, the cost per pay period will increase from $5.22 to $5.51, an increase of twenty nine cents. In total, the renewals preserve the core benefit offerings for employees and retirees at an overall 5.8% increase.

Senators present at today’s Committee of the Whole included Milton E. Potter, Marvin A. Blyden, Angel L. Bolques, Jr., Dwayne M. DeGraff, Ray Fonseca, Novelle E. Francis, Jr., Alma Francis Heyliger, Hubert L. Frederick, Marise C. James, Franklin D. Johnson, Carla J. Joseph, Avery L. Lewis, and Kurt A. Vialet.

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