The Shumlin administration’s decision to spend $2.8 million on messaging for the Vermont health exchange is unprecedented and unnecessary, politicians and observers said Tuesday.
The $2.8 million contract with GMMB, a Washington, D.C. firm, is about a third of the $9 million in federal dollars the state has for outreach and education: $2.3 million is going to Richmond-based HMC Advertising for media buys, and another $2 million is for so-called “navigators” to provide one-on-one assistance. In all, the state has roughly $170 million from the federal government to launch Vermont Health Connect.
GMMB is spending $500,000 to solicit “earned media,” or positive stories and op-eds in local news outlets. Most of the money is for developing messages for speeches, talking points, news releases, editorial boards and reporters.
Though big businesses and advocacy groups commonly hire media relations firms to audit media companies and spin stories to the press, sources interviewed for this story say state government has not previously spent such prodigious sums on media relations.
The scale of the project, however, is also unprecedented: The state is mandating that 100,000 Vermonters buy insurance on the exchange over a six-month period.
Whatever the public relations strategy, the online enrollment program for Vermont Health Connect simply hasn’t worked very well. The state website hasn’t functioned properly since it was launched on Oct. 1. As of the end of last week, only 141 people had fully enrolled. In the aftermath, state officials have had to deflect a torrent of bad publicity. As of Tuesday, 631 Vermonters had signed up, according to a report from WCAX. The deadline for enrollments is Dec. 21 in order for coverage to be effective Jan.1. Vermonters can sign up for the exchange until March 31.
A survey conducted at the end of September showed that the 43 percent of Vermonters who have heard of Vermont Health Connect, less than half knew what it was.
The “earned media” buy
Vermont Press Bureau reporter Peter Hirschfeld first reported that the state contract with GMMB, which is famous for its media campaigns for President Barack Obama, includes an audit of the media in Vermont.
Politicians, media observers and public relations experts say this is the first time a state agency has employed a media relations firm to audit coverage by local media outlets. GMMB researchers gave news organizations a thumbs-up or thumbs-down for positive or negative coverage, and used the information to shape messages for news reporters.
Mark Larson, the commissioner of the Department of Vermont Health Access (DVHA), described the $500,000 “earned media” project as “a very small piece of a multifaceted public outreach effort.”
GMMB was paid $18,235 for a brief analysis of six months of media coverage about Vermont Health Connect. GMMB codes articles as having a positive, negative or neutral tone, and it spotlights certain reporters, such as VPR’s Bob Kinzel, whose coverage, by their estimation, has exhibited a negative bent.
Former Gov. Jim Douglas, Gov. Peter Shumlin’s Republican predecessor, said the need to spend hundreds of thousands of dollars to influence press coverage of his initiatives never arose.
“I’ve never heard of it being done before, and I certainly didn’t do it,” Douglas said. “I generally had a good relationship with the press that covered me. The working press who I dealt with I thought were fair and professional.”
Douglas said he presided over a much smaller public information campaign, consisting of advertisements when the state rolled out the Catamount Health Plan. His administration contracted the work out to GMMB.
“I never had any concerns about how it was portrayed when I signed the bill. … It was a bipartisan initiative,” Douglas said. “This is bigger and more politically charged, but I can assure you I never spent money to audit the press. All governors from time to time express some exasperation about coverage, but that’s the process. Whatever level of frustration I may have experienced, I dealt with that.”
Though most of the $500,000 in the “earned media” category of the $2.8 million contract is for honing messages, certain line items in the Shumlin administration’s contract with GMMB raised eyebrows among political bystanders.
GMMB spent $8,600 for a contact list of the state’s dozen or so statewide reporters and media outlets that cover health care. The firm’s earned media plan, dated April 2013, recommends that Vermont Health Connect set up “introductory meetings” with 10 reporters, including: Bob Kinzel, WBTN/Vermont Public Radio; Nancy Remsen, Burlington Free Press; Andrew Stein, VTDigger.com (sic); Peter Hirschfield (sic), Rutland Herald/Times Argus; Joe Gullo, Fox News 44/ABC 22; Pat Bradley, Northeast Public Radio/WAMC.com; Dave Gram, Associated Press; Olga Peters, The Commons; Chris Fleisher, Valley News; and Jennifer Brandt, Vermont Business Magazine. The firm also suggests that state officials reach out to “mom bloggers with niche audiences” such as NEK Moms and Burlington VT Moms Blog Vermont.
The contract sets aside $12,600 for GMMB to schedule meetings between editorial boards and Vermont Health Connect officials, but that fee doesn’t include materials, such as talking points, or managing the calendar for the meetings. Those services cost an additional $49,000.
In its earned media plan, GMMB targets seven editorial boards for outreach: the Burlington Free Press, VTDigger.com (sic), Rutland Herald/Times Argus, Valley News, The Bennington Banner, The Caledonian-Record, Vermont Business Magazine.
The plan supplies the department with generic advice such as: “Using a wide range of tactics will offer many bites at the apple.” It offers the following tips for developing relationships with reporters, editorial writers and columnists: “Relationships should be built on an informal and introductory basis. These should be off-the-record discussions over coffee, lunch, email or an in-person meeting.”
The contract allocates $37,267 to GMMB to create a stockpile of success stories, dubbed a “story bank,” related to the exchange. As part of the arrangement, GMMB is supposed to provide media coaching to the individuals at the center of these stories, offering “speaking tips and tricks to put them at ease” and working with them to “ensure the story to be genuine.”
Eric Davis, a retired Middlebury College political science professor, questioned the cost and the need to contract out for such services.
“The amount of money being spent for some of these services was pretty high,” Davis said. “I think previous administrations would have been able to research this information using in-house staff and wouldn’t need to pay thousands of dollars to get that information.”
Lt. Gov. Phil Scott said he was “underwhelmed” by GMMB’s ad campaign. He is concerned that not enough Vermonters are going to get the basic information they need to sign up for the state’s exchange.
“I have to be honest, when I heard the ads I wasn’t that impressed,” Scott said. “I wanted more factual information rather than sales and marketing. I felt as though I was getting the sales pitch.”
As for the size of GMMB’s expenditures? “I’d have assembled that list (of media contacts) for a lot less money … all they had to do was call me,” Scott said.
“I think the governor is fiscally prudent, but if this was state money I wonder: Would we be doing the same thing, or is it because we look at this as being free we see it as a windfall and utilize it in that manner,” Scott said. “I’m guessing probably not. If the dollars were more limited … I don’t think we’d be doing this this way.”
Davis said he was also surprised DVHA chose to rely on a firm with political roots.
“What did surprise me a bit when I read the story was that this contract for advertising was given to a firm that does mostly political work rather than a firm that does mostly advertising work,” he said.
Governor’s office directs inquiries to Larson
The governor’s office distanced itself from the contract with GMMB Tuesday. Shumlin did not take phone calls from reporters, and he is not holding a press conference this week. All inquiries were directed to Larson.
“We did not have anything to do with that contract,” Sue Allen, the governor’s  press secretary, said.
Asked whether Shumlin had seen the contract before it was approved, Allen said she wasn’t sure, but would check. At the time of publication, she had not responded. Allen said she personally had no recollection of seeing the contract.
Allen handles media duties for Shumlin — collating press lists, distributing news releases, referring reporters to public officials, and reaching out to editorial boards — but she said her work is confined to the governor’s office.
When asked if she could have supplied DVHA with some of the information that GMMB was paid to provide — for example, a list of relevant reporters and editorial boards — Allen said that question never came up.
“I was never asked for anything like that,” she said. “I have never even looked at the contract. That’s not part of my job to assist with a contract.”
On some occasions, Allen’s work does dovetail with that DVHA, she said. “I have reached out to editorial boards and said if you need information, call Robin [Lunge] and Mark [Larson],” Allen said, but that wasn’t the case with this contract.
“I don’t work for DVHA. I work for the governor,” Allen said. “And this was a special contract where things were kind of spelled out. This clearly would not have been in my domain.”
Larson said the rollout of Vermont Health Connect required more resources than the administration could provide.
“It was a constant message we were getting that we needed to do more to get information out to Vermonters and the usual resources within the administration to engage in this ongoing education process were not adequate,” Larson said. “We had a competitive bid process where GMMB was the winning bidder in supporting that project. It wasn’t an either or between Sue Allen, Louis Porter and others, it was always thought of as strengthening the resources internally.”
GMMB was one of six bidders for the original contract with the state. The Shumlin administration has twice amended the contract and increased the maximum expenditures. The first bid amount, $670,000, was upped 171 percent to $1.8 million. On Aug. 30, officials signed off on another 57 percent increase, raising the amended contract to $2.8 million.
Jeb Spaulding, secretary of the Agency of Administration, says, “It’s very common for the contract for be to amended and for the scope of work to be changed.” Spaulding couldn’t say whether the administration had asked contractors to conduct media audits in the past.
GMMB did not return a request for comment before press time on Tuesday.
Anne Galloway and Andrew Stein contributed to this report.