By Katie Kerwin McCrimmon
Republicans are blasting Senate Democrats for killing an exchange audit bill that had won nearly unanimous support in the House.
Today the bill failed on a 4-to-3 party line vote with Democrats on the Senate Health and Human Services Committee voting to kill the bill.
Sen. Steve King, R-Grand Junction, blasted Democrats for burying a bill that had even won support from Democratic Speaker of the House Mark Ferrandino.
“I am unbelievably disappointed in the Democratic majority’s decision to turn their backs on the concept of transparency and best practices in government by voting on a party line to kill this bill,” said King, a Senate sponsor for the bill. “There has been bipartisan support for auditing Connect for Health Colorado from day one because it promotes good government and transparency.”
Sen. Kevin Lundberg, R-Berthoud, accused Democrats of politicizing the audit.
“What happened today in committee is a disgrace and the majority party should be ashamed of themselves. It’s clear that Senate Democrats killed this bill in an attempt to cover up the failures of ObamaCare,” said Lundberg, a House committee member who voted for the bill.
Colorado’s auditor is already conducting a narrow audit of millions of dollars that have flowed into Connect for Health Colorado, including $177 million in federal funds.
House Bill 1257 would have given Auditor Dianne Ray the authority to conduct a much more extensive review of how the exchange conducts its business.
Ray planned to complete the full audit by December and said the bill would allow her to evaluate whether millions of dollars are being spent properly and whether Connect for Health Colorado can become financially self-sustaining as required by January of next year.
The sponsors tried to win support for the bill by selling it as a non-partisan measure and noting that none of Ray’s findings would be released before the November mid-term elections when all lawmakers could face controversy over anything related to Obamacare.
Ray testified Wednesday that there are significant potential risks associated with Connect for Health Colorado.
“You have all of the dollars…flowing through in a very quick way,” Ray said.
She likened the need for an audit to the necessity of tracking millions of federal dollars that flowed into Colorado through federal stimulus programs.
“When all of the Recovery Act dollars all of a sudden flooded the state, these programs immediately went to high risk,” Ray said.
She conceded that it’s unusual to audit such a new entity, but said that financial controls can be inadequate when an entity is spending so much money so fast. She also questioned whether Connect for Health does adequate background checks on its employees and contractors, and said the need to be financially self-sustaining by January puts pressure on Colorado’s exchange.
“We believe that with a performance audit, we could make recommendations that would help,” Ray said.
Connect for Health CEO Patty Fontneau testified that the exchange has been audited multiple times by the federal government and outside auditors and said that an extensive state audit would divert her staffers from their primary task of enrolling customers in health insurance. The deadline to enroll for 2014, however, is Monday. For the rest of this year, exchange staffers will be tuning up their systems and prepping for the 2015 open enrollment, slated to begin on Nov. 15.
“It is very difficult to pull them (staffers) away from other things that they are doing to do this,” Fontneau said.
Fontneau also brought with her a lawyer that Connect for Health has hired. Mark Grueskin of the Denver firm Recht Kornfeld, said he was not there to support or oppose the bill. But he tried to argue that Ray does not have the authority to conduct a full audit of the exchange since it’s an “instrumentality of the state,” not a state agency. Because it’s not a state agency, Grueskin contended that the federal government, not the state government had the right to conduct an audit.
Pressed about whether she welcomed a full audit, Fontneau declined to answer.
She said she did not want to be evaluated on performance standards that were not clear in advance.
“We don’t have any idea what we will be audited on. In all of these situations (past audits) we were given frameworks in advance,” Fontneau said.
The Republicans on the committee who wanted the audit pressed for transparency.
They included Sen. Larry Crowder, R-Alamosa, Sen. Owen Hill, R-Colorado Springs and Lundberg.
“I serve on the (exchange) legislative oversight committee. I welcome this (audit) I have a lot of questions that have not been satisfied. I should hope that the exchange should welcome this as well,” Lundberg said. “Where the exchange is concerned, complete transparency should be the order of the day.”
The Democrats who rejected the audit, however, said that Colorado is doing relatively well and that the exchange is too new to be audited.
The Democrats who voted no were Sen. Linda Newell, D-Littleton, Sen. Jeanne Nicholson, D- Black Hawk, Sen. Irene Aguilar, D-Denver, and Sen. John Kefalas, D-Fort Collins.
“I’m going to be opposing (this bill) and supporting the health exchange’s continued efforts to be transparent,” Nicholson said. “My impression…is that they are being extremely transparent. I think they already have had a number of audits and have demonstrated their performance.”
Nicholson and Newell both said an audit now would be premature.
Aguilar also said she’s been impressed with Connect for Health’s transparency and said she thinks they’re running a pretty “lean machine” and that she doesn’t want to “throw more government at them.”
Aguilar said she thinks Colorado is doing pretty well by being among the top-performing exchanges in the nation.
As of the end of February, Colorado was the fifth best out of 14 state-run exchanges in terms of enrolling the greatest percentage of people in the state. But the numbers are very low in all the states. And some of the states running their own exchanges have failed to get their systems to work at all. Even so, in Oregon, where the state-run computer system has not yet worked, officials have nonetheless signed up about 50,000 people through paper applications. By comparison, Colorado has signed up about 105,000 people and spent millions of dollars on a complex computer system.
Enrollments end on Monday and the final numbers for Colorado sign-ups should be available early next month.