Alabama educators’ medical health insurance plan requests American Rescue Plan funds for COVID-19 costs

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The Alabama Public Education Employees’ Health Insurance Plan is asking lawmakers for a share of the state’s remaining federal dollars from the American Rescue Plan Act to cover the associated fee of medical expenses from the COVID-19 pandemic.

PEEHIP wrote letters to legislative budget chairs in August requesting $84 million from ARPA, a pandemic relief bill passed by Congress last 12 months.

The state received $2 billion from ARPA in two equal portions. In January, lawmakers approved a plan to spend the primary half, leaving $1 billion still to appropriate.

The request for ARPA money isn’t the primary from PEEHIP. In January, PEEHIP asked for $57 million for COVID-19 costs from March 2021 through December 2021. The Legislature didn’t approve that.

The $84 million is an updated request covering COVID-19 related expenses from March 2021 through July 2022. That features the associated fee of testing, diagnosing, and treating the virus, in addition to vaccinations.

Today, PEEHIP Chief Financial Officer Diane Scott made a presentation on COVID costs and other issues at a gathering of the PEEHIP Board of Control.

Overall, COVID-19 costs to PEEHIP from the beginning of the pandemic through July were about $131 million. The insurance program received $29 million from a previous federal COVID package, the CARES Act.

Rep. Steve Clouse, R-Ozark, chair of the House General Fund budget committee, said PEEHIP’s request for ARPA funds would receive strong consideration but said it was too soon to say whether he expected it to be approved.

“There’s a complete list of requests,” Clouse said. “It definitely can be a high priority.”

The Legislature won’t meet in regular session until March. Clouse said he expects a special session on ARPA funds sometime between the inauguration in January and the regular session.

Congress provided states some flexibility on how they’ll use ARPA funds. The Alabama Legislature allocated $400 million from the primary half of the state’s ARPA money to assist construct recent prisons in Elmore and Escambia counties. Other portions were allocated to the expansion of broadband web access, water and sewer projects, the state’s unemployment compensation trust fund, hospitals and nursing homes, and other purposes.

Other than the request for ARPA funds, Scott said PEEHIP is keeping its funding request to the Legislature level for the eighth straight 12 months, at $800 monthly, per lively worker. That might be for fiscal 12 months 2024, which starts Oct. 1, 2023, and could be a complete of about $967 million.

Scott showed the PEEHIP Board a projection that indicated this system may need a rise to as much as $853 per worker monthly in fiscal 12 months 2025. She said if the Legislature approves the ARPA request that it’s less likely that a rise can be needed in 2025.

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