Legislative Joint Auditing
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0:00
Thank you.
Thank you.
Thank you.
Thank you.
Folks, it's that time.
Representative Robin Lundstrum
Unverified
2:30
okay the chair calls to order first order of business is the adoption of minutes from the june 5th meeting motion who made that motion okay and the second thank you senator dawson um executive standing executive and standing committees oh um any discussion i'm sorry Hearing no discussion. All in favor say aye. Opposed? All right. Passed. Thank you. All right. Senator Dotson, could you give us the executive committee report?
Senator Jim Dotson
Unverified
3:10
Thank you, Madam Chair. The executive committee met Thursday, August 13th, 2026 and adopted the minutes from the meeting held
June 4th, 2026. Staff reported to the committee the audits and special reports scheduled to be presented to the standing committees and the full legislative joint auditing committee this month. With no new business or other business to discuss, the meeting was adjourned. The next meeting of the committee is scheduled for Thursday, September 10th, 2026, or at the call of the chairs. I move for adoption of this report. All right, thank you.
Representative Robin Lundstrum
Unverified
3:40
Do I have a motion? All right, we have
a second. We have a second from Representative Ladyman. All in favor? Aye. Or excuse me, discussion? I tend to want to go a little fast there. Sorry. Discussion? All in favor? Aye. Opposed? All right. We accept it's passed. Standing committee on counties and municipalities Senator Wallace
Senator Dave Wallace
Unverified
4:16
The committee Adopted the minutes of the meeting hill for June 2026 the committee was updated on the status of the
December 31st 2022 delinquent private water and sewer audits, and after all required reports were submitted, turnback funds have been reinstated for 40 of the original 43 entities since a less-level audit meeting held the 11th of July, 2025. The three remaining entities are currently not able to receive past or future turnback.
The committee was notified that the four entities have not filed their December 31st, 2023 delinquent private water and sewer audits in December, I'm sorry, in 26th entity have not filed their December 31st, 2024 delinquent private water and sewer audits. The committee was also notified that the city of Bulldogs has not filed December 31st, 2024 delinquent private city audit. The committee was notified that after staff follow-up visit with the town of Umm,
the town is now in substantial compliance with municipal accounting law. The town of Fargo remains in substantial noncompliance with the municipal accounting law, and the committee approved a motion to notify the Treasurer of State to escrow 50% of the town's turnback per Arkansas Code 1459117. Officials for the town of Lead City were present to address substantial noncompliance with municipal accounting law,
The committee approved a motion to give town officials 60 days to reach compliance as required under Arkansas Code 1459117. The committee reviewed 14 deferred reports and 225 current reports. Officials from 10 entities were present to address repeat findings. Five previously deferred reports were filed and nine were deferred. Of the 224 current reports reviewed, 21 we referred to prosecuting attorneys,
22 we referred to the Attorney General, and one was certified to the Governmental Bonding Board. The committee filed 211 current reports and deferred 14 reports to allow officials to answer the questions and provide additional information at that future meeting. And, Madam Chair, that's the longest I've ever talked down here, and I'm done. Well, you did a great job, and I'll tell you what, your committee's been
Speaker 14
6:43
doing a great job. Y'all have been getting it done.
Representative Robin Lundstrum
Unverified
6:50
I moved to adoption by Senator Dotson. Second. Second, Representative Ladyman. Discussion. I just want to make a comment here. That committee has been working very hard, and we're down to three cities. That's
really impressive. So thank you for all your diligence, and thank those cities. We now see the benefit of getting
those audits done. All those in favor? Opposed? Report
has passed. Representative Duke, you're up on deck.
Representative Hope Duke
Unverified
7:28
Thank you, Madam Chair. The committee met Thursday, August 13, 2026 and adopted the minutes from the June meeting. 79 education audit reports were included on the committee's agenda for review. There were 56 audit reports with no findings and 23 reports with findings. Officials from five school districts and two open enrollment public charter schools were present to answer questions from the committee related to repeat findings in the respective audit reports. Representatives from the ADE Division of Elementary and Secondary Education were also present to
answer committee questions. 11 audit reports reviewed by the committee contained findings that were referred to the applicable prosecuting attorney and attorney general. In addition, two of these reports were also certified to the governmental bonding board. The audit reports for Blytheville School District were deferred to the September meeting. The committee filed 78 audit reports and deferred one audit report that were brought before it. I move to adopt
Representative Robin Lundstrum
Unverified
8:28
this report. Thank you. Do I have a motion or second? Second, Representative Brown.
Discussion All right, this committee's also been doing some good work all those in favor Opposed that's passed.
Thank you Moving on we have the state audit comprehensive financial report. Oh I'm sorry we went past state agencies
Representative Steve Unger
Unverified
8:58
representative Unger Nine reports were on the committee's agenda yesterday the following findings were
presented. The Department of Parks, Heritage, and Tourism had an unauthorized payroll disbursement and implicit collateral on a bank account. The treasurer of the state failed to make accounting entries to record known liabilities. Various state agency members were present to report how the agencies intended to address the audit findings and how to answer committee questions during the meeting the committee filed seven reports the
committee deferred the two following reports to the September meeting the September excuse me the special report regarding sexual risk avoidance education federal funds at the Department of Health and the audit report for the Department of Parks Heritage and Tourism madam chair I move to adopt
Representative Robin Lundstrum
Unverified
9:59
this report okay we have a second
from senator Dodson discussion those in favor aye those opposed it's a past all right mr. white
Speaker 22
10:13
thank you madam chair this presentation is going to cover the next two reports on the agenda which are the annual comprehensive financial report in the single audit report during the last meeting in June this committee deferred both reports to allow members additional time to review these reports and submit requests to invite entities back to the meeting today to answer additional member questions. At the chair's request, staff sent reminder emails to committee members with an August 3rd deadline. No questions or requests were submitted. As such, no agency representatives were invited for the meeting today.
Madam Chair, that concludes my presentation on both
Representative Robin Lundstrum
Unverified
10:53
of these reports. Thank you do I have
a motion motion to adopt both reports Motion representative lady men and a second senator Dotson discussion All those in
favor all those opposed all right both reports have passed Mr. White the special report
Speaker 26
11:22
Cameron Spivey, which of you would come on
Speaker 27
11:34
up? Thank you, Madam Chair. Arkansas Code requires Arkansas Legislative Audit to conduct an annual review of the Employee Benefits Division, EBD, and the performance of the health and benefit plans. The primary objective of this report was to analyze the fund balances of both the state and public school employee health and benefit plans at June 30, 2025. This year's report contains no findings.
EBD administers the health and benefit plans for both state and public school employees. Benefits are provided through self-funding, a method by which the state takes in contributions from both the employee and the employer. Separate funds are set up for each plan to pay health and pharmacy claims and to serve as reserves to prevent dramatic rate increases to subscribers. EPD pays UnitedHealthcare to manage the group Medicare Advantage plan commonly referred to as the MAPD plan for Medicare-eligible retirees.
This exhibit, which is found on page 2 of the report, shows the plan enrollment for both subscribers and members for each plan. The term subscribers refers to both employees and retirees who are enrolled in the plans, while the term members refers to subscribers and the qualifying dependents who are enrolled in the plans. As detailed in this exhibit from fiscal year 2024 to 2025, the number of subscribers increased by 625 for the ASC plan and increased by 1,027 for the PSC plan, creating a total increase of 1,652 for both plans.
The exhibit shown on this slide and on page 2 of the report provides Medicare-eligible retirees by enrollment in a retiree plan. the bottom row of the exhibit provides a provides the participation rate for the MAPD plan as of June 30th 2025 and schedule one on page 12 of the report provides a three-year comparison of the MAPD plan participation rate the first plan discussed is the Arkansas State employee ASC plan as shown in the
exhibit on the slide and on page three of the report the ASC plan had just under $402 million in fund revenue for fiscal year 2025. State contributions provided 63% of total revenue, subscriber monthly premiums made up 22%, and other revenues accounted for 15%. Other revenues included items such as FICA savings, investment income, and pharmacy rebates. As shown in Exhibit 6 on page 5 and on the slide, the ASC fund balance increased to $151.3 million
at the end of the fiscal year the fund had a growth rate in fiscal year 2024 of 44.3 percent compared to the 26.6 percent growth rate in fiscal year 2025 the fund's growth was primarily the result of plan revenues exceeding expenditures by 34 million and a 2.2 million dollar increase in the actuarial incurred but not reported claims revenues were higher primarily due to the increase in employer monthly contribution rates and the increase in pharmacy rebates.
Exhibit four on the slide and on page four of the report provides a five-year comparison of cost per subscriber for the ASC plan. The health and pharmacy claim cost to the fund per subscriber represented by the blue line totaled $771.11 per month and $82.70 increase from the prior year $688.41. The out-of-pocket cost to subscribers represented by the red line decreased from $366.29 per subscriber per month in fiscal year 2024 to $351.09 in fiscal year 2025.
This exhibit, which is provided on page 5 of the report, shows the changes in claims and administrative costs represented by the blue line, as well as premiums and other revenues represented by the red line for the ASC plan for the past five years since 2022 revenues have exceeded cost which has contributed to the growth in the fund balance schedule four on page 15 shows health and pharmacy claims by plan type shown on this slide is the portion of the schedule related to the ASC plan for
fiscal year 2025 health and pharmacy claims paid from the fund totaled 203 point two million and 119.2 million respectively while the mapd plan cost totaled 20.5 million additionally schedule 5 on page 16 provides a five-year comparison of health and pharmacy claims for active employees health health plan claims and pharmacy plan claims both increased approximately 15 million from fiscal year 2024 to 2025. as noted on page four of the report in fiscal year 2024
pharmacy claims totaled 99.7 million and pharmacy rebates totaled 21.9 million resulting in a net cost of 77.8 million in fiscal year 2025 pharmacy claims increased to 119.2 million and pharmacy rebates increased to 47 million resulting in a net cost of 72.2 million year-over-year cost decreased by 5.6 million the next few slides contain information regarding the public school employee
psc plan the exhibit on the slide and on page six of the report shows over 505 million in fund revenue for the psc plan for fiscal year 2025. legislative funding provided 28 percent of the total contributions from school districts amounted to 29 percent subscriber monthly premiums made up 28 percent and other revenues delivered 15 percent as shown in exhibit 10 on page 8 and on the slide the psc fund balance decreased to 173.8 million at
the end of the fiscal year in fiscal year 2024 the fund balance grew at a rate of 0.9 percent over fiscal year 2023 in fiscal year 2025 the fund balance experienced a decline of 15.8 percent the health and pharmacy claims cost to the plan per subscriber as represented by the blue line totaled $603.41 per month, a $75.97 increase from the prior year's $527.44 per subscriber
per member claim cost. Out-of-pocket costs to employees, as represented by the red line, increased $3.59 from $346.88 per subscriber per month in the previous fiscal year to $350.47 per subscriber per month. Exhibit 8 on page 7 and on the slide provides a five-year comparison of cost per subscriber for the PSC plan. This exhibit which is provided on page 7 of
the report shows the changes in claims and administrative costs represented by the blue line as well as premiums and other revenues represented by the red line for the PSC plan for the past five years. Since 2024 costs have exceeded revenues which has contributed to the decline in the fund balance. Schedule 4 on page 15 shows health and pharmacy claims by plan type. Shown on this slide is the portion of the schedule related to the PSC plan. For fiscal year 2025, health and pharmacy claims paid from the fund totaled
$346 million and $135.2 million respectively, while MAPD plan costs totaled just under $10 million. Additionally, Schedule 7 on page 18 provides a five-year comparison of health and pharmacy claims. From fiscal year 2024 to 2025, health plan claims for active employees increased over $23 million and pharmacy plan claims increased over $25 million. As noted on page 8 of the report, in fiscal year 2024, pharmacy claims costs totaled $106.1 million and pharmacy rebates totaled $22.5 million,
resulting in a net cost of 83.6 million. In fiscal year 2025, pharmacy claims increased to 135.2 million and pharmacy rebates increased to 53.6 million, resulting in a net cost of 81.6 million. Year-over-year costs decreased by 2 million. ALA also reviewed 12 members of the ASC plan and 34 members of the psc plan with cumulative claims exceeding five hundred thousand dollars ala tested these claims for accuracy and timeliness of case management services and noted no discrepancies
the cumulative health and pharmacy claims exceeding five hundred thousand dollars reviewed by ala totaled 37.5 million in fiscal year 2025. this concludes my presentation agency representatives are here to answer committee questions All right, we have a number of questions.
Representative Robin Lundstrum
Unverified
20:59
Let's get one of the agency folks up here and get some answers. Mr.
Wallace, we'd like to swear you in, if you could please rise. Both of you, gentlemen, if you would, do you solemnly swear or affirm, I'm sorry, did I do that? If you would state your name and employer first and position. Grant
Speaker 36
21:28
Wallace, Director of the Employee Benefits Division and Office of Property Risk.
Speaker 37
21:33
James Caldwell, CFO for Shared Administrative Services. Thank you,
Speaker 38
21:36
gentlemen. If you would please raise your right hand.
Representative Robin Lundstrum
Unverified
21:42
Do you solemnly swear or affirm that the testimony you are about to give will be the truth, the whole truth, and nothing but the truth? Thank you, gentlemen. All
Senator Justin Boyd
Unverified
21:57
right. Senator Boyd. Thank you, Madam Chair. So this is a timely report. As you know, we've had a lot of discussion about the public school employees' plan needing more funding.
And then also we've got contract review for Novotis and UnitedHealthcare in your ALC subcommittee next week. So the one question I definitely have, whether it's for Mr. Wallace or for staff, is when we audit this, this is great information, but are we auditing versus what state laws might be? Or are we just auditing numbers versus, you know, members, what have you?
Speaker 22
22:40
if you could answer that it's not I'm sorry Mr. White appreciate that thank you so the audits that we perform of the employee benefits division it covers both aspects some of it is the financial side and some of it is the compliance side what you're seeing before here today is more of the financial side and in that aspect as opposed to
Senator Justin Boyd
Unverified
23:11
the compliance with state laws okay so if state
law said you can't reimburse your affiliate more than you reimburse another pharmacy is that something specifically that you are evaluating in your audit thank you that's a great question in the course of what
Speaker 22
23:27
we do here and then when we audit EBD that is not within the scope of what we would look at that would be a request for us to go to the the
Senator Justin Boyd
Unverified
23:38
provider level okay because i'm assuming you're aware as mr wallace is there is a lot of discussion at the insurance commissioner
about you know whether the the state's pbm is following the laws now that gets you know is it specifically related to the ebd claim we're trying to get to the bottom of that but uh madam chair with your permission i would ask that we hold this over one more month while we have the chance to hear about the contract review and you know alc next week and then have a little bit more time to study and see how this fits into the public school employees potential rate increase okay
Representative Robin Lundstrum
Unverified
24:21
thank you if you could hold that while we get some of these
Representative Julie Mayberry
Unverified
24:29
other questions answered i'll come back to you uh representative mayberry thank you yes we had long discussion in education recently about the public school employees so this is this i agree with senator boyd very timely information coming in so i'm looking at page seven and i don't know who can answer this and probably can't get the information right now but um that second graph only goes back to 2021 and i'm just kind
curious what a 10-year graph would look like. You know, this is a sharp increase from 2021 of claims and administrative costs at 386 all the way to 531. That's a very sharp increase. And I don't know, maybe it increases that much every few years. I doubt it. But I'd like to see what that curve is. Is that something that audit would have? Is this something that's done every so often to begin with i'll start with that question we can direct staff to prepare that
Representative Robin Lundstrum
Unverified
25:30
and have that for you next month
Representative Julie Mayberry
Unverified
25:33
okay and then the second question so this says claims and administrative costs and to me that's two very different if we're looking at addressing this that's two very different issues um claims is well what can we do to keep people healthier you know and monitor some of that if that's what's causing the increase but then the other part is the administrative cost so is there any way do you all know what the breakdown is or would
audit know what the breakdown is because I think that's two very different things to look at
Speaker 31
26:16
Yes, if you're talking specifically about the PSE plan, if
Speaker 27
26:20
you look at Schedule 6 on page 17, it's about three-quarters of the way down. There's a section that says paid from the PSE fund, and it actually has a breakdown of the administrative cost and then the claims cost, which is under health care cost.
Representative Julie Mayberry
Unverified
26:36
Okay, that might take me a minute to digest that and look at that thank you because that's going to help do you have any comments on that though if you can address what do you see in your experience and and it was mentioned in our education committee that you all are trying to do some things to lower some of the cost and maybe not everybody is you know here today was at that meeting and if you could share I think you were not
there that day so anyway now now's your opportunity to explain yeah thank you for those
Speaker 56
27:06
questions, and I would say I do appreciate kind of trying to do a 10-year look
Speaker 57
27:12
back, but we all can appreciate and understand post-COVID, the inflationary index is going crazy all over the place. So really, yes, taking that snapshot of the last five years, you're going to see the largest impact of inflationary costs, both on the pharmacy side and medical side. So that really is the biggest driver when you're looking at claim spend and those things. It's just getting costlier to treat people. Yes, there are some things that we are trying to layer in, both on the pharmacy
side and the medical side, to contain costs. I jokingly will kind of laugh when vendors approach us of trying to save costs. There's no saving costs in this space. It's how do we contain it, how do we redirect it, and spend our money more wisely? How do we prevent illnesses? How do we get there earlier. Obviously, obesity is a high driver. We're looking at those things and how do we create a healthy lifestyle program that we can layer in to where we can incentivize making
healthier choices and we can deflect some of these later in life expenses that we get to. As far as the administrative cost, we have done extreme amount of work of really making our vendors sharpen their pencils when it comes time to renew or when we look at RFPs. We've gotten more competitive in the way that we have drafted our RFPs. We're utilizing outside consultants to help us make sure we're really looking at these from comparison to the market and that the state is getting the best plans. That's where you'll see from an administrative perspective, we are
keeping these things pretty flat year over year. And that's the goal is to maintain that flatness that on the administrative side, really capping what we're going to do over there, knowing that while it's a smaller part of it, every dollar helps.
Speaker 52
29:01
Okay. You mentioned the obesity, and I know a question came up
Representative Julie Mayberry
Unverified
29:06
about GLPs. Yep. And is that part of the issue, although it might be solving some obesity issues? Are we seeing the increase because of that? So, yeah, the GLP ones, and that's
Speaker 57
29:19
a great kind of call out when you look at the pharmaceutical spend. That's our highest, one of our highest if not the highest spend when we look on on our drugs those are expensive drugs and it's one of those you know if we could get creative here and sit and go let's shift that to direct to the direct to the manufacturer and and give our employees like twelve hundred dollars and let them go direct to the manufacturer who is selling this for hundreds of dollars compared to the eleven hundred twelve hundred dollars that they're charging our plan there's some tremendous
savings there. We're not quite there yet for operational aspects, but it's those kind of things that we're just seeing in the space of this huge discrepancy of what you're seeing advertised or what via TrumpRx or direct-to-consumer pricing is versus what they're charging the plans. And I think that's really where a lot of us in the plan space need to step up and challenge manufacturers, challenge our PBMs, that they need to be negotiating those prices with the manufacturers more in line with what consumers can get direct okay and i'm sorry
Speaker 62
30:26
one last question and i'll let someone else i'll get back in um
Representative Julie Mayberry
Unverified
30:31
i i guess just kind of an overall statement because in the education committee we were saying we need to come up with some more money somehow to to fund this for our public school employees and um i just want to remind everybody that um you know the teachers did get a pay raise but we have so many other staff members in our public school system that really have not seen any significant raise, our janitors,
our parapros, and many of them are willing to work for less money because they know that their insurance is, that's how they can get their insurance. So you start increasing the insurance for them, and then it doesn't, it's not a benefit for them to work there anymore and so I think as we we look at this issue in a in a wide wide angle lens that we keep that in mind that we just many of them won't be able to afford to work. So I do
Speaker 56
31:35
and thank you for kind of asking that but I do want to point out that for this particular year that is auditing the the district
Speaker 57
31:42
minimum went from $300 down to $234.50 so that's why you are seeing some of the numbers kind of skew in this particular report we are correcting that currently it's at 350 district minimum per participating employee we still need to do more work because obviously when you decrease like that it puts us behind the curve so we've got it a little bit of catching up to do and I think that's part of the conversation that started with the education
committee we'll have it additionally in the state insurance committee next week and that we need to
Representative Robin Lundstrum
Unverified
32:14
have going into the session. Thank you.
Senator Kim Hammer
Unverified
32:21
Thank you, Representative Mayberry. Senator Hammer. Thank you, Annette. I think this kind of hits on what you were just talking about, so I won't be too redundant, but on page four, it said in fiscal year 2024, the pharmacy claims cost 99.7 million. the pharmacy rebates total 21.9 resulting in a net cost 77.8 fiscal year 25 pharmacy claims
increased to 119.2 pharmacy rebates increased 47.0 million resulting in net cost 72.2 so the cost overall decreased by 5.6 million what were we doing in 25 to get the greater rebates that we weren't doing in 24? I think that's just ongoing. You're going to have some
Speaker 57
33:02
utilization mix that's going to vary year from year depending upon which drugs are used. I think it's also part of just this agreements that they're working out with the rebate contracts and maybe a mix of what
manufacturers are offering. They may increase a particular rebate. There are a lot of variable factors that go into that, but ultimately it's utilization mix and just kind of the offerings that are out there do you have any crystal ball
Senator Kim Hammer
Unverified
33:32
theory as far as what you see 26 is going to look like will the rebates go back to the 24 levels or do you think we'll be able to hold them at the 25 because to me that'll have a direct impact on the overall
Speaker 55
33:47
cost of the plan i think we're leveling out closer to 25 than we would be to 24
Speaker 57
33:52
um again with a vague crystal ball but i think
that's where we're kind of trending this year. And I would say it's interesting when you look at the coupons and the rebates. Obviously, this is a national conversation. I think there's going to be a lot of movement in this space over the next five years. So I think we just need to be aware of that, cognizant of that, and make sure that we position our plan to respond to any changes that are going to be happening in
Senator Kim Hammer
Unverified
34:20
the global economy when it comes to coupon programs, rebate programs okay and on those costs on those pharmacy utilization you track those by type of needs such
as blood pressure you know diabetes cancer you have that breakout and are seeing certain trends in certain areas right so
Speaker 55
34:37
we have drug and treatment type so we have it by both okay we'll talk to
Senator Kim Hammer
Unverified
34:42
you about that offline last question i have is that unrelated this because their name hasn't been brought up in this report that I can tell, but, like, Blue Cross Blue Shield recently combined, like, with Utah, Washington State, and some of the things that are happening under that new arrangement is
the deductibles are being jacked up out of sight to the consumer. Is there any indication in this report or anything that you see involving this plan where the deductibles are going to become greater to the, you know, to the covered population? So we just
Speaker 55
35:16
renewed, like, we did a new RFP for that particular service, Blue Advantage 1, and under that there
Speaker 57
35:22
was no structural change to our members' deductibles. The only deductible levels that would change for us would be related to our high-deductible health plan, and those are just statutorily or regulatory as we align with IRS code to make sure that we still qualify for the high-deductible health plan.
So there are often tweaks, hundreds of dollars. This isn't huge. Changes year over year when it comes to the deductible structures. So no, sir. As far as our plan design is, we should not be experiencing great shifts in the underlying deductibles for our members. Okay, thank you. Thank you, Senator Hammer. Representative Brown? My question has
Speaker 50
36:05
been asked. Thank you. All right. Thank you.
Speaker 74
36:11
Representative Duffield. There you go. Thank you, Madam Chair. Thank
Representative Matt Duffield
Unverified
36:29
you for coming today. You mentioned you had hired some outside consultants. Could you elaborate a little more on these outside consultants, how much that cost, and where this
Speaker 57
36:39
company was from? Okay, so for the example that I was utilizing was Boston Consulting Group.
They're a statewide vendor that was selected through the Office of State Procurement to assist any agency in negotiating contracts. We utilized them on our RFP for our third-party administrator, the Blue Cross Blue Shield contract, and they helped us draft that, do some underlying kind of evaluation to make sure we were kind of in the right space and getting the most competitive offer, I want to say that was $240,000 is what we spent.
Representative Robin Lundstrum
Unverified
37:16
Thank you. All right. Thank you, Representative Duffield.
Senator Mark Johnson
Unverified
37:27
Senator Johnson. Thank you, Madam Chair. Mr. Wallace, thank you for this presentation. I appreciate what you said about trying to take a long view on healthy outcomes. And you touched a little bit on the GLP-1 issue. I'm reminded of, gosh, it's a long time ago, 20 years maybe, and I was working for an organization that was educating seniors on the rollout of Medicare Part D.
I remembered a conversation with then-Congressman Snyder, who also is a physician, and he said that it didn't make a lot of sense that, you know, if you have diabetes and you have to have your leg amputated, that Medicare will pay to cut your leg off. In those days, he said $30,000, probably a lot more now. But they wouldn't pay for the nominal amount for the drugs that would keep you from having to have your leg amputated. And I'm hoping that we can use that same logic maybe to fight obesity,
which I think most people consider it a major health problem well beyond just the diabetic issue and i would hope that that union board could look at that and i'm sure there's probably some studies that would would back that up but to make those drugs more affordable it might actually be a net cost savings to the system so i would you agree absolutely we need to
Speaker 57
38:50
be studying this and look at it we are we're having these conversations
I think the challenge for us is at the price point right now, it would not be sustainable to move that to full-on weight loss. And it's how do you build the guardrails? How do you make sure that, quite frankly, somebody like me who just wants to get beach ready has the shot for three months and that's on the plan versus somebody who really needs it to be able to make a lifestyle choice? I would also say we don't need to just solely rely upon a shot.
It's not the silver bullet. We need to make sure any plan that we design is a holistic plan that encompasses behavioral health, mental support, nutritional support, exercise support, and that it's all wrapping because it's a lifestyle change. It's not just a one-and-done kind of thing. And we've got to make sure that we are holistically supporting our employees through that process so that we truly get that lifelong impact. And that, like I said, it's not just a flash in the plan that we're getting it right now, but there's some rebound that we have to deal with five years from now.
Senator Mark Johnson
Unverified
40:00
Would it be possible for a scenario, something like, you know, that EBD could pay up to, and you mentioned a few hundred dollars a month, as opposed to the $1,500 a month, and then the employee could make a rational decision based on, hey, I can pay a certain amount of co-pay, but I just can't pay $1,500. Right, and I think that's what we're trying to figure out, the mechanism by which
Speaker 57
40:22
that could work, and how do we build the system to do that. and we just don't have that done right now great well thank you
Representative Robin Lundstrum
Unverified
40:32
chair thank you any other questions representative our senator boyd thank you
Senator Justin Boyd
Unverified
40:42
madam chair chair i just again i move that we hold this audit over one month to see if we've got any unanswered or
other questions that we'd like to ask before finalizing it all right thank you i
Representative Robin Lundstrum
Unverified
40:54
have a motion do i have a second multiple seconds discussion all those I'm sorry senator love did you have a
Senator Fredrick J. Love
Unverified
41:04
question you want to get in the key real quick all right go for it thank you madam chair I just
Speaker 86
41:19
want to ask by holding this report over is it is there any impact a negative impact to the agency that's um
Representative Robin Lundstrum
Unverified
41:27
i don't think so it's this is an audit report if they want to take time to review it some more i don't think that's going to
Senator Fredrick J. Love
Unverified
41:34
be a problem well i just i just want to ask that
Representative Robin Lundstrum
Unverified
41:36
question thank you fair enough thank you all right any other discussion
all those in favor opposed it passes thank you all right moving on thank you gentlemen next up we have a review of case transfers in the 19th western district
Speaker 90
42:12
mr. Camp thank you madam chair this report is issued in response to requests approved by this committee for legislative audit to conduct a review of cases transferred between divisions in the 19th West Judicial District Circuit Court the review is conducted primarily for court cases they were open on February 25th of this year the date the
Speaker 91
42:40
data was downloaded and provided by the
Speaker 90
42:42
administrative office of the court. The objectives of this review were to document processes for random assignment of judges within the context software system, document processes for initiating and making transfers between the divisions in the court, compare distribution of caseload for open cases pursuant to the court's 2026 administrative plan and examine selected transfers and related documentation for propriety and assess internal controls
related to case transfers the court is comprised of seven divisions and consists of Benton County in its entirety in 2025 approximately 13,600 cases were opened in the court with an approximate daily average of 9,200 open cases. Cases in the court are assigned to judges on a random basis as outlined in the 2026 administrative plan, which was approved by the Arkansas Supreme Court and is provided
in Appendix A. The administrative plan allows for the distribution of cases among the seven circuit judges with criminal, civil, juvenile, domestic relations, and probate cases separated as shown in Exhibit 1 on page 2 of the report. As previously mentioned, Objective 1 was to document processes for random assignment of judges within the context system. According to AOC staff, the system uses a weighted random method of selection
based on a set pool size. If the judge initially selected recuses, another judge is chosen based on the same method and a chip from the new judge's pool is added to the recusing judge's pool for the next selection. It should be noted that per the administrative plan, all juvenile, adult protective services, and specialty court cases are assigned to Division III. Therefore, weighted random selection does not apply.
Objective two was to document processes for initiating and making transfers between the divisions in the court. Based on information provided by court personnel, when a case is opened, the system automatically assigns a case number and randomly assigns a judge. After the initial judge is assigned, transfers between divisions can be either randomly selected by the system or entered directly. transfers entered directly into the system are appropriate when there is a circuit court order
transferring a case signed by the presiding judge. Transfers may also be authorized by Administrative Order No. 2015-1, provided in Appendix B, and initiated by the prosecuting attorney. It should be noted that the Circuit Clerk's Office instituted an internal policy in which the prosecuting attorney is asked to confirm the direct assignment of cases in writing. This policy is not required by the administrative order, and there are no controls in place to require this documentation in the system.
Additionally, transfers may be authorized when circuit court bond hearings are provided over by a district judge. Transfers entered
Speaker 96
45:59
directly into the system should be accompanied by documentation that is entered
Speaker 90
46:08
into the official court record. Objective three was to compare distribution of caseload for open cases pursuant to the 2026 administrative plan. On February 25th, 9,351 open cases were divided between the seven
divisions of the court, as noted in Exhibit 2 on page 4, and each judge's caseload by type of case was compared to the administrative plan. Differences between actual results and the administrative plan are deemed reasonable considering the direct transfers noted in objective 2. Objective 4 was to examine selected transfers and related documentation for propriety and assess internal controls related to case transfers. A total of 1,673 or 18% of the open cases had at least one transfer
between divisions. Of these cases 207 were transferred two or more times resulting in a total of 2013 transfers between divisions as noted in exhibit three on page four legislative audit examined documentation and related court documents for 1074 cases or 64% of all cases with transfers this group consisted of all cases with transfers occurring two days or less after the case
initiation date in any cases were the first transfer date prior to the case initiation date this review revealed the following instances in which documentation supporting a transfer could not be located in internal court connect three related cases were transferred to division one but had all been randomly assigned by the system to division two these transfers occurred without following the internal controls established by the circuit clerk and and without proper documentation, as noted in Objective 2.
The circuit clerk, through legal counsel, and the prosecuting attorney provided responses to these transfers, which are included in their entirety in Appendices C and D. For 26 cases, transfers were confirmed by the administrative judge for the court as being properly made. For two transfers, the assigned division noted in the data obtained from AOC in Objective 3 did not agree with the actual court order uploaded to the internal court connect. These discrepancies have been corrected.
As a result of this review, legislative audit recommends the following. First, although the circuit clerk has instituted an internal policy in which the prosecuting attorney is asked to confirm the direct assignment of cases in writing, the court should consider incorporating this policy into Administrative Order No. 2015-1. second administrative office of the court should consider strengthening system controls in regard to transfers requiring that one documentation be included with all transfers
and two a second authorized individual sign off electronically on all transfers in the system the court was provided an opportunity to respond to the report but no response was received a response from the administrative office of the courts is included in appendix e madam chair this concludes my presentation officials from benton county and the administrative office of the courts are present to respond to committee questions thank you i'll open it up to the members first
Representative Robin Lundstrum
Unverified
49:33
and see if you have any questions all right i do understand we have guests here
today of judge brad karen and benton county circuit clerk brenda deshields do you wish to make
a statement all right thank you for coming mrs shields are you keep i i can't see her is no all right thank you so much okay thank you all right since we have no questions and no discussion do i have a motion i have one motion do i have a second second discussion
All those in favor? Opposed? All right. Thank you. It passes. Our next meeting will be September the
10th and 11th. See you soon. Thank you so much for coming.
Agenda
A. Call to Order by Chair
B. Adoption of Minutes
C. Reports of Executive and Standing Committees:
D. Review of Reports:
E. Other Business:
F. New Business
G. Adjournment
Documents
No documents posted.
Speakers
Representative Robin Lundstrum
Unverified
Senator Jim Dotson
Unverified
Senator Dave Wallace
Unverified
Speaker 14
Representative Hope Duke
Unverified
Representative Steve Unger
Unverified
Speaker 22
Speaker 26
Speaker 27
Speaker 36
Speaker 37
Speaker 38
Senator Justin Boyd
Unverified
Representative Julie Mayberry
Unverified
Speaker 31
Speaker 56
Speaker 57
Speaker 52
Speaker 62
Senator Kim Hammer
Unverified
Speaker 55
Speaker 50
Speaker 74
Representative Matt Duffield
Unverified
Senator Mark Johnson
Unverified
Speaker 77
Senator Fredrick J. Love
Unverified
Speaker 86
Speaker 90
Speaker 91
Speaker 96