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Senate committee hears SB113 to fold Arkansas Health Insurance Marketplace into Insurance Department; amendment sets March 15, 2019 effective date
Summary
The Insurance & Commerce Senate committee debated SB113 to transfer the Arkansas Health Insurance Marketplace (AHIM) into the Arkansas Insurance Department (AID), adopted an amendment setting a March 15, 2019 effective date, heard public comment from Nate Bell asking for time to propose reforms, and then failed a committee motion to advance the bill by roll call (committee announced a 4–3 result).
Senator Jason Rapert, sponsor of SB113, told the Senate Insurance & Commerce committee that a joint oversight committee had spent roughly 18 months reviewing the Arkansas Health Insurance Marketplace (AHIM) and unanimously recommended transferring the exchange’s functions into the Arkansas Insurance Department (AID).
Rapert said an amendment to SB113 setting a specific effective date—March 15, 2019—was adopted after consultation with the governor’s office. He also said co-chairs Richard Womack and he had requested a legislative audit of AHIM to preserve records and clarify operations ahead of the proposed transition.
Insurance Commissioner Alan Kerr presented financial estimates the department would use to absorb AHIM duties. Kerr said, “That cost, we're looking at a total of $571,500” for transition expenses and characterized that as a high estimate; he added the department expects roughly $2,000,000 in savings for ratepayers over time by eliminating duplicated functions. Kerr said navigators and a call-center contract (with AFMC) would likely continue temporarily under existing arrangements.
During committee questioning, members pressed Kerr about staffing and whether AID could absorb AHIM work with minimal hires. Kerr said AID already performs much of the preparatory work and that a division in AID handles rate filing, open enrollment prep and related duties. Committee members asked about navigator funding; Kerr said navigator services are federally required and that current contracts run about $300,000 per year, with AID having budgeted roughly $500,000 to manage related transition expenses.
Nate Bell, who said he accepted a board offer to work with AHIM the previous day, testified in opposition and asked the committee not to move the bill forward immediately. Bell said he was willing to work with the sponsor and the committee to present a reform plan that might allow AHIM to remain independent while addressing oversight and fee concerns. “I would ask this committee to not move this bill forward today and to allow me a few days… to bring a reform plan,” Bell said.
After debate about whether to grant Bell and others a short delay, a motion to advance SB113 was put to roll call. The clerk called roll; the transcript records announced ayes for Senators English, Johnson, Raybert (transcript spelling), and Bledsoe. The chair then stated, “With the vote of 4 to 3, your bill has failed.” The transcript shows subsequent procedural motions to move the bill to the bottom of the file and to expunge certain record items.
Rapert said he remained open to receiving any new, substantive evidence the committee should consider and that he would hold the bill on the Senate floor if something emerged, but he defended the oversight committee’s months-long examination and the committee’s recommendation to pursue the transfer.
The committee set a return meeting for Thursday and said SB113 may be taken up again when absent members (Senator Irvin) are present.
What’s next: The sponsor and supporters said they will proceed with oversight recommendations and the legislative audit is expected to begin; Nate Bell asked for a few days to submit an alternative reform plan for committee consideration.
