Senate Insurance & Commerce committee trims some statutory reports, keeps core annual oversight

The Senate Insurance & Commerce Committee reviewed a package of reports from the Arkansas Insurance Department on Wednesday and, by unanimous consent in most cases, removed some reporting requirements, retained others and instructed the department to produce overdue material for a 2021 law.

Committee members approved removing the Arkansas Health Insurance Marketplace report from statute after department officials said the marketplace was folded under the Insurance Department and user fees that formerly funded the marketplace ceased. "We suggest removing that report. It is not one that is necessary for the department to do anymore," Insurance Commissioner Alan McLean said.

The committee also voted to remove an annual review of the Arkansas workers' compensation insurance plan but retained a separate comprehensive performance-review requirement for the state residual workers' compensation market administered by NCCI (the National Council on Compensation Insurance). The committee kept the Arkansas Healthcare Transparency Initiative report as well and asked the department to continue providing a robust annual report that aggregates several units' material.

The department told the committee the marketplace previously collected a per-policy user fee that funded AHIM operations; those fees stopped when the marketplace functions were moved under the Insurance Department (AID). Deputy Commissioner Jimmy Harris said the fund once supported higher operating costs — "there was an expense charge on every policy that was included in the premium, a user fee. Those fees were then used to fund the operations of AHIM" — and that the remaining fund balance is about $3,100,000. Harris also said the department spends roughly $220,000 a year on marketing tied to the federal platform and about $500,000 a year in total when call-center costs are included; he said he would provide exact numbers on request.

A contentious discussion centered on the reporting requirement created by the 2021 Wendland craniofacial coverage law. Senator Missy Irvin pressed the department for compliance, saying she expected the department to have filed the statute's required reports since the law passed. McLean told the committee the department had not yet produced the statutorily required submissions but that staff were preparing the first report. "I would want to see one report at least," Irvin said, adding that she would move to preserve the reporting requirement unless the department files the report this session. The chair agreed to hold removal of that report pending receipt of the department's submission.

On fraud and risk reporting, the committee agreed the insurance department should fold the criminal-investigation division's health-insurance-fraud figures into the department's annual report, but to retain the health-insurance-fraud reporting requirement in statute (to ensure the information remains visible in code). The department also said its existing annual report already contains a risk-management section covering state property insurance and some school property programs.

Committee members asked for updated, hard copies of the department's most recent annual report and for staff to provide any requested fund-balance and spending details promptly. Chairing senators and members said they would review the department's forthcoming materials and revisit statutory removals if required.

Votes at a glance

- Arkansas Health Insurance Marketplace report — outcome: removed from statutory requirement by unanimous consent; notes: department said user fees ceased after marketplace functions moved under AID; department to provide fund-balance detail (outcome: approved, no objection).

- Arkansas Healthcare Transparency Initiative (all-payer claims database) — outcome: retained; committee said it provides accountability for use of carrier data and research (outcome: retained, no objection).

- Comprehensive performance review of Arkansas workers' compensation insurance plan (NCCI administration) — outcome: retained; committee cited oversight of assigned-risk administrator (outcome: retained, no objection).

- Annual review of Arkansas workers' compensation insurance plan operations — outcome: removed; committee concluded the comprehensive review covers the essential oversight (outcome: removed, no objection).

- Wendland craniofacial coverage report (2021 law) — outcome: removal postponed; committee instructed the department to file the statutorily required biannual reports and produce a report to the committee before the department's provision will be removed from statute (outcome: postponed/pended on compliance).

- Administrator risk-management division report — outcome: removed as a separate document and folded into the department's annual report (outcome: removed as standalone; material retained in annual report).

- Criminal investigation division annual report on health-insurance fraud — outcome: to be folded into the department annual report and remain referenced in code to ensure legislative visibility (outcome: folded into annual report; code language to be adjusted).

- Arkansas Insurance Department annual report — outcome: retained; committee requested hard copies and asked the department present it to the committee when the Wendland craniofacial material is available (outcome: retained).

Why it matters

The decisions change which items the legislature will receive as stand-alone reports and which will be consolidated into an annual submission. Committee members stressed retaining visibility for consumer-protection and fraud metrics and asked for financial transparency on remaining fund balances that were formerly supported by marketplace user fees.

What comes next

The department agreed to deliver the requested fund-balance and marketing-cost detail and a first Wendland craniofacial report covering 2021 through current. The chair said he will withhold statutory removals for items where the department has not yet complied and will bring consolidated language to the committee for review; the committee also scheduled bill hearings and follow-up presentations for later this week.

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