Idaho insurance director cites PBM complaints, high‑risk pool and wildfire market strain in budget testimony

Department of Insurance Director Dean Cameron told the Joint Finance‑Appropriations Committee on Jan. 21 that the department is requesting staff and equipment changes for fiscal 2026 and is monitoring several market issues, including pharmacy benefit manager (PBM) compliance, high‑risk pool effects, and wildfire‑driven stress on the homeowners insurance market.

Noah Peterson, the Legislative Services Office analyst, reviewed the department’s FY2026 enhancement requests: a staff actuary (one FTP, $201,900 requested, with $198,900 ongoing), a regulatory compliance specialist (requested at the equivalent of $41.03 per hour, described as 80% of policy for pay grade O), a $48,100 ongoing compensation increase for the state fire marshal and deputies, and $162,200 in one‑time capital outlay for replacement equipment (including $10,000 for fire turnouts, $16,200 for cameras, and $136,000 for two medium‑duty pickup trucks equipped for field use). The department has 75.5 approved FTP overall.

Director Cameron described the department’s PBM implementation work under last year’s pharmacy benefit manager reform (House Bill 596). The department received a trailer appropriation to implement HB596—one FTP and $132,400—and is collecting required PBM reports. Cameron said PBMs have “submitted a required format” and that “most have complied,” but the department has received numerous complaints and is still working with noncompliant firms. Cameron told senators the single staffer assigned to PBM work “is doing a great job” but said the volume exceeds what one person can handle; he offered to provide the committee a fuller report as data collection continues.

Cameron also described the state’s high‑risk pool and a federal waiver (referred to in testimony as the “13‑32 waiver”), which the director said has supported lower individual market rates and more participating carriers on the health insurance exchange. Cameron told the committee the high‑risk pool functions as a reinsurance mechanism that helps carriers manage expensive claims by identifying covered conditions annually and sharing claim costs.

Wildfire exposure and the national reinsurance market were central topics in Cameron’s remarks. He said insurers have tightened writing in certain areas after years of large wildfires in other states and that some carriers have nonrenewed Idaho homeowners even where local wildfire risk appears low. Cameron said, “This last year we burned a million acres, just under a million acres,” and described work the department is pursuing, including proposed legislation to create a mitigation and carrier‑support pool to help homeowners harden properties and to help carriers remain in the Idaho market.

Cameron highlighted strain in the surplus lines market (nonadmitted carriers) that has grown as agents place homeowners with carriers outside the admitted market; he said surplus lines policies can have fewer consumer protections and more volatile pricing. The department also reported reversions in FY2024 (approximately $2.2 million), with the insurer regulator reverting about $917,000 of personnel appropriations and $1,277,000 of operating appropriations.

Committee members asked for additional details. Representative Furness asked Cameron to explain the “13‑32” waiver and the high‑risk pool’s effect on premiums; Cameron said the waiver helps match state funding with federal funds to reduce premiums and that the high‑risk pool has helped hold rates down by spreading expensive claims. Senator Cook asked for complaint counts and compliance metrics for PBM work; Cameron said the department is collecting data and would provide more detailed reporting when available.

No formal votes occurred during the hearing; the presentation was for committee consideration as part of the budget review process.