Florida Insurance Exchange Has Paid Lobbyist But No Policies

A struggling state-sponsored health insurance program in Florida is paying a lobbyist $5,000 a month to work part-time while she is still listed as representing private clients with ties to the health industry, according to Health News Florida.

Florida Health Choices hired Lauren McCarthy in late July to work for up to five months getting the organization set up, the nonprofit news service reported. The program, created in May 2008 and given $1.5 million in state funds, is planned as an insurance exchange for people seeking nontraditional, inexpensive benefits. So far it has not written any coverage.

McCarthy isn’t expected to work more than 20 hours a week for Health Choices although she may occasionally, said Board Chairman Aaron Bean, who championed the free-market experiment when he served in the House.

“It’s great money for a part-time job,” he conceded, but quickly added, “So far, she has been a very professional person. She is getting the job done.”

McCarthy’s job for Health Choices involves building the organizational structure and coordinating bimonthly board meetings until a full-time chief executive officer can be hired.

According to state records, McCarthy is still a registered lobbyist representing private clients, including some with ties to the health care industry.

Tallahassee attorney Mark Herron, an expert on ethics law, said the arrangement is legal if McCarthy doesn’t represent any of her clients before the Florida Health Choices board.

Still, some consumer advocates think her hiring was improper. “It may not be illegal, but it is not right,” said Brad Ashwell, lobbyist for the Florida Public Interest Research Group.

Phone calls and e-mails to McCarthy seeking comment on her position were not returned.

Bean said McCarthy was the only person considered for the position and that it was not advertised. She was recommended by Tallahassee attorney Wilbur Brewton, who is providing free legal work for the board.

Brewton said he has known McCarthy for several years because they share office space and that her work is impeccable. The corporation needed someone immediately to coordinate meetings, he said, and McCarthy was available.

“How the hell do you get organized and going if you don’t have anybody to do the work?” he asked.

The July 23 board decision to hire McCarthy came after “heated” discussion, according to Bean. There is no tape recording of the meeting, according to Brewton, but draft minutes show that there was “considerable debate” before the board approved the hiring on a 5-2 vote.

“We needed somebody right away to step in, step up, and get the job done,” Bean said.

Health Choices’ board is scheduled to begin looking over applications for a permanent chief executive officer at its Monday meeting. The salary will range from $80,000 to $140,000 a year, depending on experience, according to the job advertisement.

A state list of registered lobbyists shows McCarthy represents three clients. One is Jacksonville-based Family Cafe, which provides information and support to persons with disabilities and their families and hosts them each year at a networking conference that receives state and private funds.

Records show McCarthy also represents Devereux Florida, which provides mental health and developmental disabilities treatment to over 12,500 children and families annually through 46 programs throughout the state, according to its Web site. Devereux says it is the largest provider of these services in the country and the state of Florida.

McCarthy’s third client, according to the records, is the firm of Guy Spearman. The well-known Tallahassee lobbyist represents a number of health care organizations, including Capital Health Plan and Wuesthoff Health System in Melbourne. Spearman’s firm also represents Altria Services, parent company to Phillip Morris, whose operating companies include Marlboro, Copenhagen and Skoal.

According to her resume, McCarthy left Spearman’s firm last year to run the successful state Senate campaign for Thad Altman, R-Melbourne.

McCarthy earned up to $30,000 for representing the clients in the first six months of 2009, according to state records.

Lobbyists typically represent clients not only during the 60-day legislative session, which adjourns in May, but also at special sessions, planning sessions during the fall, and committee meetings in the winter. Lobbyists also track rules and regulations that agencies may implement that can impact their clients.

For the last week of July and month of August, McCarthy collected $6,125 for her work at Florida Health Choices, according to the association’s financial records.

The Florida Health Choices initiative was created last year with the support of former House Speaker Marco Rubio to help establish an alternative marketplace where small employers and others could help employees purchase health care plans. The policies sold aren’t subject to state insurance regulations, just the guidelines established by the Health Choices board.

To help establish the new marketplace the Legislature set aside $1.5 million in state revenue. To date, the board has spent only about $17,000 on travel reimbursement for board members, computers and salary for McCarthy.

No money has been spent on office space because McCarthy is working out of a suite of offices shared by lobbyist Spearman and attorney Brewton.

Florida Health Choices was passed in spring 2008 as part of a package of reforms that also included the Cover Florida program, promoted by Gov. Charlie Crist. At the end of July, Cover Florida had about 4,130 policies, while recent census data show the number of uninsured Floridians has grown to 3.6 million.

Bean has attributed the delays in Health Choices getting off the ground to Sunshine Law requirements that prevent board members from having private conversations. Bean said Crist also was slow in making his appointments to the board of directors.