consultants are sandburs

Thursday, December 13, 2012

Gottwalt's involvement with Tyler and his role as an insurance agent came as a surprise to some members of the Legislature. Some said the arrangement raises questions about disclosure and conflicts of interest when lawmakers push bills from which they could potentially benefit. Gottwalt never brought up his role as an insurance broker during committee hearings in the 2012 session. Minutes also showed that he did not disclose his position at meetings of a health care task force aimed at implementing the federal health care law. When Gottwalt submitted the Statement of Economic Interests form that legislators are required to file with the Minnesota Campaign Finance Board, he did not disclose that he sells insurance. The form lists only his role as owner and president of Steve Gottwalt Consulting. "The least you can do is have it fully disclosed, because if it's disclosed, the public might say, 'I smell a rat.'" - Sen. John Marty, DFL-Roseville.

So the story goes. Conflicts of interest should, at the very least, be disclosed, so that the public can judge. The issue was a live one, in Ramsey's recent election, and the conflict in question may have been a contributing factor to a decisive Ward 2 challenger's success.

Back to State affairs, after the "all politics is local" digression; St. Cloud Republican legislator Steve Gottwalt, on the hot seat, according to MPR (online here).

The headline is from the MPR item, which was published to include the money quote:

The incoming chairman of the House ethics committee, Rep. Tom Huntley, DFL-Duluth, said: "If these are payoffs, then the ethics committee needs to look at it."

When Republicans took over control of the Legislature two years ago and confronted a big budget shortfall, one area they identified for cost savings was the state's Health and Human Services budget. Gottwalt then tried to sell his colleagues on the plan to trim people from MinnesotaCare.


"This is a new approach," Gottwalt told his colleagues in 2011. "It gives them a subsidy to buy that coverage in the private marketplace like the rest of us do, and it takes a new role for Minnesota that is both sustainable and healthy for the state in terms of Health and Human Services programs."
Larger view
Insurance business

In July, more than 4,000 Minnesotans were dropped from MinnesotaCare and given the option of enrolling in the new insurance plan, the Healthy Minnesota Contribution Program. It was Gottwalt's plan, which Gov. Mark Dayton signed into law as part of the deal that ended the state government shutdown.

But between the time the bill passed and when people lost their MinnesotaCare coverage, Gottwalt became licensed to sell insurance. State records show he sells insurance products for 11 companies. Hann received a license to sell insurance in June 2012.

The MPR item also states,

Even after he started selling insurance, Gottwalt authored legislation that would benefit health insurance brokers. Minnesota's conflict of interest laws say elected officials cannot act, vote on or push legislation that directly benefits them or an associated business.

[link in original] If you follow the link, the statute embodies the Brandeis adage, "Sunshine is the best disinfectant." It forces disclosure, for public scrutiny.

The MPR item further analyzes Minnesota Republican Senator David Hann's near-identical conflicted position with the same health insurance brokerage with which Gottwalt has his affiliated business. Crabgrass reported back in November of the Hann situation, how a local blogger Tommy Johnson uncovered the ripe morass, all that, this link. MPP highlights the MPR reporting, and Johnson's earlier coverage, here.

Republicans - they scratch one another's backs, to a fault.

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