House backs transfer of health-hub control

A bill that would transfer responsibility for the state’s health insurance exchange to the Arkansas Insurance Department was headed to Gov. Asa Hutchinson for his signature after passing 91-1 in the House on Monday.

Hutchinson supported Senate Bill 113 and will likely sign the legislation this week, spokesman J.R. Davis said.

The bill’s lead House sponsor, Rep. Deborah Ferguson, D-West Memphis, noted on the House floor Monday that the bill would implement the recommendation of a legislative panel that spent 18 months studying options for the future of the Arkansas Health Insurance Marketplace.

An exchange set up by the marketplace to allow small businesses to shop for coverage “turned out to be a huge failure,” and the agency’s mission has been “dramatically reduced” since 2014, when it was awarded a $99.9 million federal grant, she said.

The marketplace initially planned to use most of the grant money to set up an exchange that individual consumers would use, instead of the federal portal at healthcare.gov, to shop for plans, but it abandoned the project at Hutchinson’s request in 2015.

Instead, the marketplace took responsibility for certifying plans sold in the state through healthcare.gov and helping consumers enroll.

Meanwhile, enrollment in the small business exchange ended in 2017 because Arkansas Blue Cross and Blue Shield, the only company offering plans, dropped out.

Insurance Commissioner Allen Kerr has said his department could handle the marketplace’s duties at a cost of no more than $571,500 a year and would eliminate the portion of a fee charged to insurance companies that supports the marketplace’s operations.

The marketplace’s spending totaled about $2.6 million last year.

Former state Rep. Nate Bell, who was hired as the marketplace’s interim director late last month, mounted an effort to save the agency as an independent entity, but gave up last week after SB113 cleared the House Committee on Insurance and Commerce.

Bell had proposed cutting the marketplace’s spending by enough to reduce its fee while keeping the agency separate from the rest of state government.

No one spoke Monday against the bill, which would take effect March 15.

Rep. Roger Lynch, R-Lonoke, cast the lone vote against the bill. Four other members didn’t vote, and four voted “present.”

The bill passed 32-0 in the Senate last week, with one senator voting “present.”

Arkansas Democrat-Gazette/STATON BREIDENTHAL Rep. Deborah Ferguson talks with Rep. Dan Douglas, R-Bentonville, on Monday in the House chamber after presenting Senate Bill 113, which would fold the Arkansas Health Insurance Marketplace into the state’s Insurance Department.