Health Exchange CEO Wants Bonus, Pay Raise

December 6, 2013
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The head of Colorado's health exchange is seeking a pay raise and a year-end bonus

The head of Colorado’s health exchange, who currently earns a salary of more than $190,000, is seeking a pay raise and a bonus

DENVER – Despite dismal enrollment numbers and computer glitches, Connect for Health Colorado CEO Patty Fontneau wants her $190,549 annual salary increased — and an end-of-year bonus.

Connect for Health Colorado, previously known as The Colorado Health Benefit Exchange, reported Dec. 2 that only 9,980 individuals have signed up for private coverage through program – roughly 15 percent of the goal to enroll 61,000 by Dec. 31.

In contrast, 64,290 people have signed up on the Connect for Health Colorado (CHC) website for the federal and state subsidized Medicaid program. Though this program is growing, the state may not have appropriated enough money to fund it.

Some exchange board members questioned why Fontneau should be financially rewarded for under-performing and failing to meet private coverage enrollment goals.

“Given the poor performance for the first two months of enrollments, I think it’s incredibly audacious for the (Fontneau) to request a salary increase,” CHC Board Director Ellen Daehnick told The Denver Post.

Not only that, Daehnick said, Fontneau’s salary comes from taxpayer funding.

In addition to the lagging private coverage enrollment, Fontneau and CHC came under fire at the Nov. 22 meeting of the Colorado Legislative Health Benefit Exchange Implementation Committee for being over budget and refusing to denounce demeaning ads, dubbed “Brosurance” and “Ho-surance” aimed at young adults, who are crucial to enroll to offset the coverage costs.

“OMG, he’s hot. Let’s hope he’s as easy to get as my birth control. My health insurance covers the pill, which means all I have to worry about is getting him between the sheets,” says the ad to entice young women.

“Keg stands are crazy. Not having insurance is crazier. Don’t tap into your beer money to cover those medical costs,” says an ad depicting beer guzzling guys that supposedly appeals to younger men.

“In terms of encouraging people to sign up for the exchange, (the ad messaging) is broader than what we can control,” said Fontneau, who was reluctant to monitor independent ads that promote the exchange on behalf of CHC partners described as key stakeholders.

Fontneau told the legislative committee that the controversial advertising campaign is “not connected to Got Insurance ads” sponsored by CHC.

Yet, the “Got Insurance” ad campaign, sponsored by Doyougotinsurance.com, promotes and links to CHC’s website. And it was promoted in blast emails by left-leaning groups as ProgressNow Colorado.

“Thanks to Obamacare, Colorado has a new online insurance marketplace called Connect for Health Colorado,” states the “Got Insurance” website. It touts CHC as a “new marketplace is where you can easily compare health insurance plans, find financial assistance that could help you purchase coverage, and get the plan that’s right for you.”

Rep. Bob Gardner declared the ad campaign is “in bad taste that stretches the bounds of propriety.” And he recommended passing legislation to force CHC to impose criteria if the exchange is unwilling to set standards for ads.

“That’s a very dangerous road to go down,” warned Sen. Jessie Ulibarri (D-Commerce City), who asserted it would be a violation of free speech.

Not so, countered Sen. Kevin Lundberg (R-Berthoud), who voiced dismay that Fontneau and the CHC board of directors kept silent and didn’t denounce the ads.

“It is no imposition on free speech for the exchange to officially condemn something that is outrageous and insulting to younger adults who you are trying to attract to (buy) insurance policies,” Lundberg told Fontneau.

Another concern, Lundberg said, is that the CHC budget continues to escalate.

Originally projected as $160 million over a three-year span, he noted, the budget has expanded to $177 million for just over two years. The costs are expected to increase – CHC has actually received approval for a total of $186.4 million in grants.

Sen. Gail Schwartz (D-Snowmass Village) raised concerns about the increased insurance rates in the “resort area,” and particularly on her constituents who are lower income workers with children who can’t afford the health plans offered by the state exchange.

Though Schwartz was told the insurance rates may be lowered in 2014, it might be a temporary solution. The exchange is subsidized by federal grants now, but by 2016 is expected to be self sustaining and funded by service fees charged to enrollees.

Fontneau, who received a $5,000 bonus last year, could be awarded annual bonuses up to 10 percent and a 3 percent salary.

CHC executive committee members Gretchen Hammer, Richard Betts and Arnold Salazar are expected to either reject or approve Fontneau’s salary increase and bonus this month. The committee advises the board of directors and serves as the personnel committee to conduct performance reviews of the CEO and high level administrators.

Next Tuesday, Fontneau and the CHC will appear before the legislative Joint Budget Committee (JBC) which may question budget finances, but has no say on bonuses and salary increases.

“This whole thing has been a disaster from the beginning,” said JBC member Sen. Kent Lambert (R-Colorado Springs). “It can’t get better.”

Perhaps a bigger concern than the lack of paid-coverage enrollees is more than 64,000 Coloradans enrolled for Medicaid – a number that continues to climb.

Gov. John Hickenlooper backed legislation to lower the criteria to qualify for Medicaid and increase funding by the state this year. Lambert predicted the increased state appropriations won’t cover the increased number of Medicaid eligible recipients.

“This is socialized medicine and we can’t afford it,” declared Lambert.

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