Online insurance broker eHealth recently suggested that it temporarily take over plan enrollment for the troubled insurance exchange, which the feds are running on behalf of 36 states that don't have their own exchanges. It's unlikely that the Obama Administration will accept this offer, but the Department of Health and Human Services (HHS) should consider a related idea that could save its butt.
After the Healthcare.gov site began to have problems in October, The Healthcare Blog founder Matthew Holt pointed outthat the Centers for Medicare and Medicaid Services (CMS) had struck deals last summer with some national Web insurance brokers (including eHealth) to sign up consumers alongside Healthcare.gov. He suggested that these companies could start enrolling people while the government's website was being fixed. It wouldn't be necessary for them to check with the IRS to find out whether applicants were eligible for government subsidies, he said. At tax time, individuals who earned more than they'd predicted could settle up with the government.
eHealth, which operates ehealthinsurance.com, did not propose any delay in verifying applicants' eligibility for subsidies. Company CEO Gary Lauer asked that ehealthinsurance.com be allowed to connect directly to the CMS data hub, which has the information needed to check eligibility. This would circumvent the Healthcare.gov site and enable eHealth to start enrolling subsidy-eligible people within a short time, Lauer said at a press conference. In addition, eHealth would be able to use its connections with the backend systems of health plans to send them enrollment data much more reliably than Healthcare.gov has been able to do so far.
Now, I'm not suggesting that HHS let eHealth take over enrollment for the federally operated insurance exchange, even for a short time. There are a number of other private health insurance exchanges, and it would be patently unfair for the government to give eHealth such a huge advantage over its competitors, let alone depend on a single company for such a crucial responsibility. On the other hand, I don't buy HHS' reported claim that they don't need eHealth because everything will be hunky-dory at Healthcare.gov by the end of November. Neither does veteran health insurance consultant Robert Laszewski, who said in a blog post that CMS contractors apparently have a "months of work left"to fix Healthcare.gov.
A better solution is to let the five online brokers that have entered agreements with CMS -- as well as any other Web insurance middlemen that meet CMS' criteria -- enroll subsidy-eligible individuals in the 36 states immediately. All of these entities should be allowed to connect directly with the CMS data hub, which is online with the IRS and other federal agencies. Such a process would be far much more efficient and less error-prone than the Rube Goldberg-type contraption that CMS designed to ping data back and forth several times between the agency and the online brokers during enrollment. So it should be continued even after Healthcare.gov is fixed.
Laszewski suggests that, besides giving private brokers the ability to enroll people right now, CMS should also publish the contact information for insurance companies offering qualified plans on each state's insurance exchanges, including those operated by Healthcare.gov. He says the health plans, too, should be given access to CMS' subsidy calculator. I agree.
After the Web brokers and insurers start carrying the ball, the federal website should be taken down for repairs, and its home screen should simply tell people how to enroll online through the private exchanges and insurance firms. (The enrollment-by-phone option, according to some reports, has also been a disaster, although it should still be available to people who don't have Internet access.)
While Healthcare.gov is being fixed, CMS should consider doing one other thing to ensure that when it comes back online, it will be able to communicate successfully with the health plans. As noted recently by InformationWeek Healthcare, the decision of CMS to use the 834 HIPAA transaction standard to send enrollment files to health plans didn't reckon with a problemthat is only too familiar in the healthcare industry: Most carriers have not upgraded their computer systems to conform to the HIPAA transaction standards. CMS won't require plans to use new operating rules that will permit them to receive these files without external tweaking until Jan. 1, 2016. So even if CMS got the front end of Healthcare.gov running perfectly by Nov. 30, many health plans still might not be able to receive complete enrollment files. What the agency should do is to accelerate the creation of the enrollment operating rules and begin requiring plans doing business on the insurance exchanges to use them right away.
The Obama Administration's credibility is on the line because of technical issues that will take some time to resolve. HHS can stick to its story that all will be well with its website by month's end; but if it's wrong, an avalanche of blame and shame will fall on the Administration and might even bury Obamacare. So HHS has nothing to lose and everything to gain by facilitating an alternative to Healthcare.gov that will let the millions who desperately crave health insurance sign up for it now.