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Insurance exchange contracts with Boise law firm to investigate executive director decisions

Insurance exchange contracts with Boise law firm to investigate executive director decisions

Idaho Freedom Foundation staff
October 30, 2013
[post_thumbnail]Steven Weeg, state insurance exchange board charirman, has confirmed that the board has hired a law firm to investigate its executive director, Amy Dowd, and the circumstances surrounding her decision to award a no-bid contract for $375,000 to a former board member.

Board members of Idaho’s government-run health insurance exchange have entered into a contractual arrangement with an additional Boise-based law firm to investigate the management of the state’s insurance exchange.

Specifically, the focus of the investigation will be controversial decisions made by the exchange’s executive director, Amy Dowd, as well as the advice she may have received from the exchange’s legal counsel and the office of Gov. Butch Otter in making those decisions.

“We’ve selected an attorney with the law offices of Holland and Hart,” said Sen. Jim Rice, R-Caldwell, a member of the exchange’s board of directors. Rice told IdahoReporter.com that J. Frederick Mack, a partner in the firm, will oversee the investigation.

The call for an investigation of Dowd arose after she announced on Oct. 17 that she had extended a $375,000 no-bid contract to a former board member, Frank Chan. Five days later the board met again amid a firestorm to terminate the Chan contract and to set new stringent limits on Dowd’s authority to enter in to such agreements.

It was also revealed at the Oct. 22 meeting by board member Zelda Geyer-Sylvia that the board had never previously established any official procurement policies, resulting in the board establishing on that day that Dowd would have to obtain its approval for future contracts amounting to $15,000 or more.

Additionally, despite board member Dr. John Livingston’s disclosure at the Oct. 22 meeting that Dowd had sought input from both Otter’s office and from the Hawley Troxell law firm of Boise (the exchange’s official legal counsel) before agreeing to the contract with Chan, the board nonetheless voted to launch an outside investigation of Dowd’s decision.

When reached by telephone Tuesday afternoon, board chairman Stephen Weeg confirmed to IdahoReporter.com that Frederick’s investigation has already begun.

“The investigation is under way,” Weeg told IdahoReporter.com. Noting that he has been traveling for the past several days, Weeg added that he had delegated the task of overseeing the selection of an investigator
to Dave Self, a member of the exchange’s board of directors and an executive with Pacific Source insurance.

“Dave and the subcommittee reviewed several prospective attorneys and then chose Mack,” Weeg stated. Weeg also noted that, while he was uncertain what the cost of the investigation was projected to be, the contract with Mack and the Holland and Hart firm nonetheless set a ceiling on the price that the firm would charge the exchange.

Both Rice and Weeg said Dowd’s discussions with the governor’s office and the Hawley Troxell law firm would be a part of the Holland and Hart firm’s investigation.
However, said Rice, “This will not be a broad-ranging investigation,” adding, “It will be focused on the Chan contract specifically, but we will not exclude any of the events that led up to that decision. Mr. Mack will review all of the circumstances.”

Weeg concurs with Rice. “Our investigator will consider all the pertinent details,” he said.

Calls to the law offices of Mack and to board member Self, seeking further information, were not returned prior to publication of this story.

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