Committee reviews transformation bills to reorganize Veterans Affairs and create Department of Health; members press oversight and technical fixes

Lawmakers spent the bulk of a Dec. 6 committee meeting reviewing large "transformation" bills designed to reorganize multiple agencies: HB 1071 (Department of Veterans Affairs changes) and HB 1072 (creating or consolidating a Department of Health and moving boards and functions under that cabinet-level agency).

Amy Fettcher, chief transformation officer for the governor, and State Representative Andy Davis appeared to summarize the measures and explain the administrative intent: to move certain staff and functions into cabinet-level departments and to align code sections so similar functions sit together. Fettcher described HB 1071 as shifting three staff members into the cabinet-level veterans department, updating language to reflect two veterans homes (Fayetteville and North Little Rock), and replacing director titles with "secretary" where appropriate.

Committee members raised numerous technical and policy questions. Senator Hickey, among others, asked whether establishing or maintaining district offices should include additional oversight instead of vesting unilateral authority in a single official; sponsors said they aimed to limit the transformation bill to structural changes and would address substantive oversight in separate legislation.

Senators also identified omitted or moved phrases that could change meaning if not restored. One member flagged language transferred from a claims-specialist code section that dropped the phrase "in securing their rights and benefits," which could unintentionally restrict employees' permissible activities; staff agreed to reinsert the language if it matched intent.

HB 1072 prompted extended discussion about the Department of Health. Questions ranged from whether secretaries will require Senate confirmation (staff said confirmation language will be included in the compiled final draft for all 15 secretaries), to whether personnel ultimately answer to the secretary or to divisional directors (sponsors said the secretary would retain ultimate authority but delegate day-to-day supervision).

Deputy Director Anne Purvis confirmed that the current surgeon general, Greg Bledsoe, serves under a department contract rather than as a classified state employee; she said the contract is "approximately $170,000." Members probed the Health Information Exchange (HIE), which currently operates within state government (about 17 employees). Sponsors and staff described the HIE's transfer options, discussed sustainability through transactional user fees, and acknowledged concerns about governance, FOIA exposure and privacy protections. Staff repeatedly emphasized that much of the language represents existing law relocated within the code for consistency and that any substantive policy changes could be pursued separately.

Committee members asked staff to keep a running list of technical fixes and to verify appropriation and funding implications where language moves a program from a cash agency to state-funded positions. Sponsors said they would work with affected boards, such as the medical board and massage therapy stakeholders, to address independence and regulatory concerns before the bill is finalized.

The committee did not vote on the transformation bills during this meeting; staff and sponsors committed to making clarifying edits, preserving board authorities where intended and returning a consolidated bill for further review.