A state board Wednesday hired a Little Rock advertising firm to conduct a multimillion-dollar campaign to promote enrollment in Arkansas-based health insurance exchanges that the board is establishing for individual consumers and small businesses.
The Arkansas Health Insurance Marketplace board of directors voted 4-0, with two members abstaining, to award the contract to Cranford Johnson Robinson Woods. The contract is expected to total about $5.8 million over two years.
The firm will be responsible for designing the website that will replace healthcare.gov as the portal Arkansans use to shop online for coverage in the exchanges.
The firm's proposal also calls for television, radio and print advertising, promotional events and a "news bureau" that will pitch story ideas to reporters and respond to their questions.
Members of the firm and its subcontractors on the project "believe that every Arkansan should have access to quality health insurance, and we're going to work toward that end," Darin Gray, the firm's president, told marketplace board members Wednesday.
Created by the Legislature in 2013, the marketplace is using money from a $99.9 million federal grant to set up exchanges that would replace the ones set up for the state by the federal government.
Enrollment in the small-businesses exchange is expected to begin this fall for coverage that will start in January.
Enrollment in the exchange for individual consumers is expected to start next year for coverage that will start in 2017.
At a meeting last month, representatives from Cranford Johnson Robinson Woods told board members that the firm will subcontract with FleishmanHillard, a St. Louis-based subsidiary of New York-based Omnicom Group that has worked on campaigns promoting enrollment in federally run exchanges in Missouri and Illinois.
The firm also plans to subcontract with Livonia, Mich.,-based Market Strategies International for market research and two Arkansas firms. Cinco Media & Communications Group will help promote enrollment among Hispanics, and Brandfactory will help tailor outreach toward blacks.
The board chose the Cranford Johnson Robinson Woods firm over two other Little Rock firms: Mangan Holcomb Partners, which proposed spending $4.9 million, and Impact Management Group, which proposed a $5.876 million campaign.
Mangan Holcomb Partners led a $4.3 million campaign, featuring the slogan "Get In," that promoted enrollment in Arkansas' federally run exchange in 2013.
That campaign was scrapped after the Legislative Council refused to review an extension of the Insurance Department's contract with the firm that would have paid to extend the campaign past Oct. 1, 2013.
The Legislature later passed special language prohibiting the Insurance Department from promoting enrollment.
Marketplace director Cheryl Smith Gardner noted that Mangan Holcomb's work on the 2013 Arkansas project was "limited in scope" because the campaign was never completed.
The firm's bid did not include a required strategic communications plan, she added.
Marketplace board chairman Sherrill Wise and Insurance Commissioner Allen Kerr, a nonvoting board member, said they were concerned that hiring Mangan Holcomb could draw objections from state lawmakers, who Kerr said could interpret the board's actions as making "an end run around the Legislature."
"That will not play well," he said.
A marketplace staff evaluation rated Cranford Johnson Robinson Woods the highest, followed by Mangan Holcomb Partners and Impact Management.
Also on Wednesday, the board voted unanimously to accept up to $22 million in federal grant money from the state Insurance Department if the transfer funds are approved by federal officials.
The money represents the unspent balances from grants that have been awarded since 2012 to the Insurance Department to provide information to consumers and regulate the plans offered on the state's federally run exchanges.
The U.S. Department of Health and Human Services' Centers for Medicare and Medicaid Services has said the Insurance Department can't spend the money on operating expenses after June 30 because it was meant to pay only for the exchange's startup and initial operating expenses.
But, according to Kerr, federal officials have said the money can be used through June 30, 2016, to pay costs associated with the transition to a state-run exchange.
The marketplace board hopes to use the transferred grant money to pay the Insurance Department to continue performing some duties, including regulating the plans sold on the exchange, while the state-based exchanges are being established.
"We're still working through what [federal officials] will let us pay for," Gardner said. "If we're doing it, it's not considered maintenance and operation, it's considered design, development and implementation.
"If it's being done over at AID, it's considered maintenance and operation because they've been doing it for two years already."
Metro on 04/09/2015