Insurer exchange chief's raise OK'd

The Arkansas Health Insurance Marketplace board voted Wednesday to increase the marketplace director's annual salary by $5,000 to $170,000.

The board also voted to recommend that the Arkansas Legislature set a 3 percent fee on premiums of plans sold on state-based insurance exchanges starting in 2017.

The salary increase for Director Cheryl Smith Gardner was meant as "an acknowledgment that things seem to be going well from our point of view," new board Chairman Chris Parker said after an hour-long executive session to discuss Gardner's performance.

The fee recommendation is required by the state law that created the marketplace board, and it likely will be revisited as board members get more detailed estimates of the cost of running an exchange, Parker said after the meeting.

Board members elected Parker chairman Wednesday to succeed Sherrill Wise. The board's bylaws call for it to elect officers at its last meeting in September of each year.

The actions came after Gov. Asa Hutchinson last week asked the board to put on hold its plans to create a state-based exchange while a legislative task force studies alternatives to the state's private-option Medicaid program, which buys coverage on the federal exchange for low-income Arkansans.

Created by a law passed by the Legislature in 2013, the marketplace board has been using money from a $99.9 million federal grant to establish exchanges for individual consumers and small-business employees.

Enrollment in the small-business exchange is to start Nov. 1.

Hutchinson said last week that he doesn't see a need for a state-based exchange for individual consumers, but he wants to wait until lawmakers decide on a replacement for the private option before making a final decision about whether to continue with the project.

Board members said Wednesday they will request information from companies on the cost of transferring the technology for an individual exchange from another state to Arkansas.

Hutchinson said last week that such a request is "not inconsistent with a pause," but that the board should be careful in how it spends grant money.

Parker said the information from companies will help the board evaluate its options and could inform legislators as they craft a replacement for the private option.

Act 1500, which created the marketplace board, requires the board by Oct. 1 of each year to recommend a fee for exchange plans.

The fee recommendation approved Wednesday was the same recommendation the board made last year for 2016.

The Centers for Medicare and Medicaid Services charges a 3.5 percent fee on the premiums of plans sold on the federally operated exchanges.

The marketplace board's recommendation is contingent on the federal agency lifting the federal fee, which is expected to happen for the small-business exchange plans once the state-based small-business exchange is operational.

About 200 employees, from 13 companies, are enrolled in the small-business exchange, board member Fred Bean said. Arkansas Blue Cross and Blue Shield is the only company offering plans on that exchange.

During the executive session before the board approved Gardner's pay increase, "there was just some discussion that people were generally pleased with the activities that had gone on" during the past year, Parker said.

The salary increase was Gardner's first since she was hired by the board in March 2014.

Metro on 10/01/2015

Upcoming Events