ALBUQUERQUE, N.M. (AP) — The past ties of one of New Mexico's Democratic gubernatorial candidates to a consulting company that repeatedly landed contracts to help run a state high-risk insurance pool are drawing criticism from her opponents.
U.S. Congresswoman Michelle Lujan Grisham and her campaign treasurer, state Rep. Deborah Armstrong, co-founded Delta Consulting in 2008. Lujan Grisham divested herself from the company last year but Armstrong is still an owner.
Democratic challenger Jeff Apodaca, a media executive and son of a former governor, accused Lujan Grisham and Armstrong during a recent debate of enriching themselves off the contract.
Apodaca said Lujan Grisham and Armstrong are taking "federal and state funds, and running the high-risk pool that doesn't really need to exist anymore.
"And they're paying themselves thousands and thousands of dollars," he said. "That's money that could go to New Mexico families."
The other Democrat in the three-way race, state Sen. Joseph Cervantes of Las Cruces, told Lujan Grisham: "You've been paid a lot of money from a state contract until you decided to run for governor."
State Insurance Superintendent John Franchini, chairman of the medical insurance pool's board, told the Albuquerque Journal this week that Delta Consulting has won competitive bids in recent years to handle administrative work associated with the high-risk insurance pool.
The current yearly contract is for roughly $600,000. It's paid by a mix of insurance company fees and patient premiums, not state dollars, Franchini said.
He said he's tried to make the situation transparent and that Lujan Grisham and Armstrong have been aboveboard in their handling of the contract.
Lujan Grisham described the claims as ludicrous, saying there has been a misunderstanding about Delta Consulting and the high-risk insurance pool's function.
The pool assists New Mexico residents who don't have insurance or have been quoted at higher rates than the pool's rate. Its enrollment has dropped significantly since enactment of federal health care reforms.
New Mexico's Governmental Conduct Act allows elected officials and legislators to contract with the state government as long as the contract is issued after a competitive bidding process and if the elected officials publicly disclose their interest.
Those conditions appear to have been met, at least in recent years, by Lujan Grisham and Armstrong.
Lujan Grisham's campaign manager Dominic Gabello said Lujan Grisham received no salary from Delta after being elected to Congress, though she did cite an annual income of between $15,000 and $50,000 from the company on congressional financial disclosure forms in past years.
That income represents distributions from the company which were largely used to pay the firm's tax bills, Gabello said.
Lujan Grisham divested her interest with Delta Consulting six months after announcing her gubernatorial bid, according to Armstrong.
Lujan Grisham announced in late 2016 she would forgo a re-election bid to her Albuquerque-area congressional seat and instead run for governor.
Delta Consulting has made hefty campaign contributions to Lujan Grisham and Armstrong. Lujan Grisham reported receiving from the company $11,000 — the maximum allowed for the 2018 election cycle — for her gubernatorial bid.
There are no laws barring candidates' businesses from contributing to their campaigns. Cervantes has also reported taking sizable donations from several family-owned agriculture businesses that he plays a role in operating.
Lujan Grisham said during the recent debate that New Mexico's high-risk insurance pool specifically pays for the hospitalization and treatment of individuals who have been denied insurance coverage, including children with cancer, and adults dealing with liver and kidney diseases.
Overall enrollment has declined since then-President Barack Obama signed into law the Affordable Care Act, which barred insurance companies from denying coverage to people with pre-existing conditions.
There are currently about 2,700 people enrolled in the pool, down from roughly 10,000 at the time the reforms were enacted, Franchini said. Many of those enrolled are immigrants who are in the country illegally and cannot qualify for federally subsidized health insurance.
Franchini said he's wary of doing away with the pool, given the recent debate in Congress about repealing or overhauling the health care law.
Others disagree.
Rep. Paul Bandy, R-Aztec, introduced legislation in 2017 that would have effectively done away with the pool. The bill was tabled in a committee chaired by Armstrong. She didn't vote on the bill, saying she was intentionally absent for that debate.
Bandy said Lujan Grisham and Armstrong's involvement in the company was concerning to him.
"It's kind of an inside job," he said.
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Information from: Albuquerque Journal, http://www.abqjournal.com