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Arkansas spends $4M on Obamacare ads, wants more

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Part 53 of 96 in the series Obamacare
AP file photo

THEY DON’T WANT IT: State Sen. Bart Hester, R-Benton, said his constituents demanded an end to the taxpayer-funded advertising campaigns.

 

By Eric Boehm | Watchdog.org

Like a child that blows his entire allowance on candy and bubblegum, then gets angry when his parents won’t let him have more money, the Arkansas Department of Insurance says the state Legislature is blocking their promotional efforts for Obamacare after the department already burned through $4 million in taxpayer cash to advertise the health insurance exchanges.

In May, the department signed a contract with a Little Rock-based public relations firm to promote the Arkansas Health Connector, a website designed to inform Arkansans of their health insurance options under Obamacare and ultimately to funnel them towards the health insurance exchange.  Arkansas is one of seven states operating a joint federal-state health insurance exchange after declining to run their own.

But just as the exchange went online, the connector went dark.

When the Arkansas Legislative Council reviewed the contract in June, they voted against releasing the second round of cash.  Without it, the department was unable to renew their contract with Mangan-Holcomb Partners, the PR firm running the various promotional efforts related to the Arkansas Health Connector.

The contract expired on Sept. 30 and was supposed to be replaced with a new one beginning Oct. 1, to coincide with the launch of the federal exchanges.

State officials say the second round of promotions were going to be the “action phase,” encouraging residents of the state to buy coverage, after the first round was focused on building “awareness” of the new health care regulations.

CONNECTION INTERRUPTED: The Arkansas Health Connector was designed to funnel people towards the federal health exchange, but its funding has been cut off. Whether its a political stunt or a taxpayer-friendly move depends on who you ask.

CONNECTION INTERRUPTED: The Arkansas Health Connector was designed to funnel people towards the federal health exchange, but its funding has been cut off. Whether it’s a political stunt or a taxpayer-friendly move depends on who you ask.

But the department spent the first round of grant dollars on efforts that some viewed as propaganda, rather than useful information about the coming changes to Arkansans health insurance.

State Sen. Bart Hester, R-Benton, said his constituents demanded an end to the taxpayer-funded advertising campaigns.

“They said ‘you better not be spending my tax dollars on advertisements for Obamacare,’” Hester said.  “If my constituents don’t want Obamacare, how I can vote in favor of spending $4 million to promote it?”

A review of the contract signed by the department with Mangan-Holcomb revealed some of those questionable expenses, including more than $26,000 used to develop and market an Arkansas Health Connector iPhone app and another $144,000 spent on social media and search engine advertising.

The department spent another $23,000 on a pair of vinyl signs designed to be wrapped around buses and driven across the state as a means of advertising the website.

A $2.6 million statewide media campaign topped it all off, including a 28-minute infomercial featuring Gov. Mike Beebe and other state officials talking up the positives of the Affordable Care Act.

“There were just so many things that made us question how the money was being spent,” said Hester, who said he thought the money should have been used to inform Arkansans of how the changes would affect them on an individual level, rather than blatant promotion of a federal program.

When the Legislature decided not to renew the contract and release the second part of the federal grant, the Arkansas Health Connector was left in the lurch.  The website has not been updated since mid-September and the promotional efforts were forced to cease, just as the federal exchanges went online.

Cynthia Crone, deputy commissioner of the Arkansas Insurance Department and leader of the Arkansas Health Connector project, said the department spent the first round of funding on “outreach and education,” because it was expecting to get a second dose of funds beginning Oct. 1 to focus on enrollment.

“Stopping outreach and education funds is detrimental,” she told Watchdog.org last week. “We now need our ‘action phase’ — Get Enrolled — to become active. Now is the time to market the healthier groups.”

Crone blames Republicans in the Legislature (only one vote against renewing the contract came from a Democrat) for cutting off funding in order to score political points and to strike a blow against the health exchange program.

Hester does not deny that there was a political motivation behind the vote — in his words, it was “a political move, but the right political move to represent the people of Arkansas” — but he says the primary reason for shutting off the grant was to save taxpayer money, regardless of whether that money flowed from Little Rock or Washington, D.C.

If it hurts enrollment in the Obamacare exchanges, well, he said he doesn’t really mind that side effect.

CYNTHIA CRONE, Deputy secretary, Arkansas Department of Insurance.

CYNTHIA CRONE, Deputy secretary, Arkansas Department of Insurance.

The Arkansas Health Connector is not a vehicle to sign up people for health insurance, but is purely a promotional enterprise designed to increase awareness of the federal exchange.  Arkansas is one of 36 states that decided not to run its own health insurance exchange, meaning residents of the state are left to struggle with the glitch-plagued national exchange at Healthcare.gov.

And like the promotional efforts funded in other states, the grant for the Arkansas Health Connector was appropriated and awarded by the federal government, not from the state.

Crone said the advertising blitz was effective, and could have done more if it was allowed to continue.  She said internal polls from the department showed a 30 percent increase in awareness — from 24 percent to 54 percent — between June and September of this year.  And the department has bragged about having more than 36,000 visitors to the Arkansas Health Connector website during the first few days of October.

But does that awareness translate into people signing up? In many places, it seems like the answer is no, although the federal government has released only limited information about the number of people who have successfully navigated the exchange.

Last week, U.S. Rep. Steve Womack, R-Ark., tweeted that only 18 people from his home state had signed up.

“They burned through $4.3 million with very little impact on the influence of the state,” said Jason Cline, director of the Arkansas chapter of Americans for Prosperity, which launched an ad campaign — without taxpayer dollars, he brags — aimed at stopping the ads from the Arkansas Health Connector.

Some parts of the ad campaign raised red flags with Cline’s group and with lawmakers in Little Rock.  In addition to the thousands of dollars used for iPhone apps, bus wraps and pro-Obamacare tweets, the department also paid Mangan-Holcomb more than $150,000 for “multicultural marking consulting,” though the contract does not specify any particular use for the money aside from general “consulting services.”

And The Arkansas Times, a liberal newspaper and accompanying website that gave editorial support for Obamacare and the Medicaid expansion that came with it, scored a $13,000 advertising contract with the Arkansas Health Connector.

Time will tell if the promotional efforts were worth the price tag, or if the Legislature’s maneuver to shut off the funding in Arkansas will be a crippling blow the federal health exchange that already is dealing with enough of its own problems.

But if the goal was to undermine the Arkansas Health Connector project, it seems to have worked. Unique visitors to the website fell from 13,000 on Oct. 1 to 808 on Oct. 20, according to Crone, who blames the decline on the funding issues.

Hester said the people will have their say in the end.

“It doesn’t matter if we spend $20 million trying to get people to sign up.  If they don’t want to do it, they are not going to do it,” he said.

Boehm is a reporter for Watchdog.org and can be reached at EBoehm@Watchdog.org.  Follow him on Twitter at @EricBoehm87

Part of 96 in the series Obamacare
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  2. The mystery of Obamacare spending in Arkansas
  3. Obamacare raises questions for MD small business owners
  4. Kansas official on Obamacare: ‘Let someone else be the guinea pig’
  5. Obamacare insurance marketplace has plenty of kinks on first day
  6. OR’s Obamacare insurance marketplace hits technological snag
  7. Fail: Day 1 of the New Mexico Obamacare rollout
  8. Senator asks: Do you want this dysfunctional government taking over health care?
  9. Jobs, coverage at risk with Obamacare, MN union health official says
  10. Oregon’s Obamacare ads resemble middle school art
  11. VIDEO: Obamacare vs Affordable Care Act: Comedy triumphs in court of confusion
  12. Patience is key to navigating Illinois’ Obamacare marketplace
  13. Hawaii residents, lawmakers frustrated with health connector glitches
  14. Healthy young, key to Obamacare, aren’t buying it
  15. NM’s health exchange tries to lure ‘young invincibles’
  16. Obama drama: Senator blames governor for big rate hikes
  17. Progressive group navigates Oregon students through Obamacare
  18. Maddening: Trying to log onto federal health care site
  19. You know that one guy who successfully signed up for Obamacare? He didn’t
  20. What’s wrong? It’s been a week, and Obamacare website still not working
  21. HHS Secretary Sebelius back in FL after embarrassing Obamacare rollout
  22. Health centers enroll Floridians in Obamacare as application problems persist
  23. VIDEO: Stewart skewers Sebelius on Obamacare
  24. Obamacare effect? 9 companies exit Nebraska’s health insurance market
  25. Obamacare: Children of undocumented parents face an uncertain future
  26. Which way do we go? Obamacare navigator registration in TN in question
  27. NM health exchange tries to ease problems with Obamacare website
  28. CPA says hype over Obamacare small business tax credit is misleading
  29. Obamacare navigator under fire for arrest warrant
  30. Reports of Obamacare fraud emerge in Tennessee
  31. After two weeks, FL online Obamacare enrollees are hard to find
  32. Illinois state governor touts 100K Obamacare enrollees, all in Medicaid
  33. Kansas lawmaker calls for crackdown on Obamacare navigators
  34. WI health care exchange seeing few getting through
  35. Hawaii’s Obamacare exchange relaunches with more glitches
  36. We’ll know next month how many people in NM signed up for Obamacare — maybe
  37. Zero: Number of Nebraskans Obamacare navigators have signed up
  38. It took this Delaware woman 11 days to sign up for Obamacare – and she was the first
  39. How many people have signed up for health insurance in VA? Who knows?
  40. What else? NM federal health exchange ads stalled due to website problems
  41. Blue Cross hires temp workers to deal with Obamacare glitches
  42. If Obamacare is the next Medicare, will physicians leave en masse?
  43. Three problems that won’t be solved by fixing the Obamacare exchange glitches
  44. Plenty of Oregonians interested in Obamacare, but none can enroll online
  45. Criticize this: Obamacare premiums a near match to WI disclosures
  46. Report: Missourians will see sharp rise in premiums under Obamacare
  47. Kansas navigators say they’ve enrolled no one in Obamacare
  48. Obamacare too costly for rich Coloradans, Democrat congressman says
  49. Study: Kansas premiums to spike following Obamacare rollout
  50. Hang on to your candy: Creepy Uncle Sam is back
  51. Obamacare or bust: NM Watchdog turned back again
  52. Medical journals, experts refute claim that Medicaid cuts ER use
  53. Arkansas spends $4M on Obamacare ads, wants more
  54. LOL: In July video, HHS bragged about being ‘on schedule’ with Obamacare
  55. Illinois uses Day of the Dead to market Obamacare
  56. Sebelius denies GOP’s Terry ‘unreliable’ Obamacare info
  57. About 290,000 Washington residents lose health insurance plans
  58. Broken promise: Obamacare cancels almost 20,000 Kansas health care plans
  59. Top hospitals opt out of Obamacare
  60. Obamacare moves to intensive care
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  63. Obamacare hitting Wisconsin residents with double whammy
  64. Kansas AG: Obamacare threatens consumer privacy
  65. 1,500 in New Mexico have to move out of the high-risk insurance pool
  66. Cover Oregon website fiasco creates jobs, but costs millions
  67. For Florida’s Obamacare small business exchange, it’s crunch time
  68. Only 877 Wisconsinites have signed up for Obamacare, federal report says
  69. Just 172 in NM have completed Obamacare applications: ‘Woefully inadequate,’ says NMIX board member
  70. With only 346 Oklahomans signed up, leaders decry ‘Obamacare debacle’
  71. Defying Obamacare: ‘Send them the bill,’ NM insurance official says
  72. Kansas Obamacare enrollment dwarfed by nearly 20,000 cancellations
  73. Numbers don’t lie: In Illinois, Obamacare means Medicaid
  74. Wisconsin governor proposes insurance plan to address Obamacare rollout failure
  75. Tennesseans might know Tuesday if they can keep canceled health insurance
  76. People demand answers over Oregon’s Obamacare fail
  77. Calif. says ‘no’ to Obamacare freebies, makes own law
  78. HI health exchange violates federal law, League of Women Voters say
  79. Obamacare video winner: ‘Forget about the price tag’
  80. Harvard study finds ‘striking’ rejection of Obamacare by young Americans
  81. HI health exchange has signed up 574 people, for about $348,000 apiece
  82. Are the uninsured getting Obamacare coverage in Illinois?
  83. Secret Obamacare handbook the feds don’t want you to see is online
  84. Lost in translation: Once-supportive Hispanics turning backs on Obama, ACA
  85. HI Obamacare exchange not fiscally sustainable, lawmakers told
  86. Illinois’ latest Obamacare targets: gold diggers and momma’s boys
  87. Now Democrats are bashing California’s Obamacare exchange, too
  88. Obamacare: For $1.37M we get Richard Simmons in lurid web stream
  89. Obamacare: A welcome mat for IRS horrors
  90. California senator seeks audit of state Obamacare exchange
  91. Report: Hawaii ranks worst for Obamacare signups
  92. CA senator sues Obamacare exchange for causing policy cancellations of 1M
  93. Failure of Maryland Obamacare exchange could mean higher premiums in North Dakota
  94. Video: Watch Creepy Uncle Sam make it rain
  95. Five bright spots surrounding the Obamacare exchange failures
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Eric is a reporter for Watchdog.org and former bureau chief for Pennsylvania Independent. He lives in Minneapolis, Minnesota, where he enjoys great weather and low taxes while writing about state governments, pensions, labor issues and economic/civil liberty. Previously, he worked for more than three years in Harrisburg, Pennsylvania, covering Pennsylvania state politics and occasionally sneaking across the border to Delaware to buy six-packs of beer. He has also lived (in order of desirability) in Brussels, Belgium, Pennsburg, Pa., Fairfield, Conn., and Rochester, N.Y. His work has appeared in Reason Magazine, National Review Online, The Freeman Magazine, The Philadelphia Inquirer, The Washington Examiner and elsewhere. He received a bachelor's degree from Fairfield University in 2009, but he refuses to hang on his wall until his student loans are fully paid off sometime in the mid-2020s. When he steps away from the computer, he enjoys drinking craft beers in classy bars, cheering for an eclectic mix of favorite sports teams (mostly based in Philadelphia) and traveling to new places.

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