State employee groups urge emergency audit of PEBB funding shortfall
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Summary
Public employee advocates told the Interim Finance Committee the Public Employees’ Benefits Program faces an unprecedented financing gap and alleged actuary accounting errors; they urged an outside audit and legislative oversight before premium and benefit changes move forward.
State employee advocates told the Interim Finance Committee on Feb. 19 that Nevada’s Public Employees’ Benefits Program (PEBB) is facing a funding crisis that could sharply raise premiums and out‑of‑pocket costs for state workers.
Doug Unger, representing the Nevada Faculty Alliance, told the panel that PEBB’s actuary flagged accounting discrepancies that could create a $56 million shortfall, and that state advocates have identified additional variances totaling roughly $96 million for FY 2026 and $110 million for FY 2027, which he said leaves “more than $200,000,000 yet to be accounted for.” Unger asked the committee to call for an external audit to determine whether funds appropriated to PEBB were received and recorded correctly.
Other witnesses amplified the warning. Cassie Charles of AFSCME said members are “staring down an increase in costs for health care benefits” and that higher premiums and benefit changes would harm recruitment and retention, force workers into second jobs, and worsen vacancies across state agencies.
Kent Urban of the Nevada Faculty Alliance and Terry Laird of the Retired Public Employees of Nevada reiterated the concern and urged the IFC to press for an outside review and faster answers. The group emphasized the timing: rate‑setting for FY2027 must begin in March to prepare for open enrollment in May.
Committee staff and the governor’s finance office said agency leaders have started to investigate differences between reports and that a PEBB board meeting is scheduled Feb. 24 to discuss the issue. Members of the committee signaled concern about making benefit or premium decisions without reconciled accounting and suggested oversight and additional reporting to the legislature.
What’s next: Advocates asked the IFC to request an external audit and tighter coordination among PEBB, its actuary, the Governor’s Finance Office and legislative staff. The PEBB board’s Feb. 24 meeting will be the immediate forum for updates; lawmakers signaled they expect follow‑up reporting to the Interim Finance Committee.