Healthcare // Policy & Regulation
Commentary
3/20/2014
01:06 PM
David F Carr
David F Carr
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State Health Insurance Exchanges Still Sick

HealthCare.gov has recovered from its rocky start. So why are state exchanges -- opened by enthusiastic supporters of the Affordable Care Act -- still suffering?

The federal HealthCare.gov website got off to an unhealthy start, but recovered after a tense, heroic effort. Meanwhile, several state-run health insurance exchanges remain chronically ill as the March 31 deadline for open enrollment looms. Citizens who are uninsured won't get another chance to sign up until the next open enrollment period begins in November.

Turns out the Tea Party wasn't the biggest threat to Obamacare, after all. An analysis by ProPublica, a nonprofit investigative news site, noted the "spectacular failure of health insurance exchanges in Minnesota, Massachusetts, Oregon, and Maryland -- all blue states that support the Affordable Care Act." They were among the 14 states that chose to implement their own insurance shopping sites, while others -- including those with administrations hostile to the law -- punted that responsibility to HealthCare.gov.

In most cases, the dysfunction of the state websites was a matter of poor performance, bugs, and missing features, some of which still haven't been addressed after six months. Oregon never managed to launch an online shopping experience for consumers at all.

Massachusetts had a working health insurance exchange before all this began, created to support health insurance reforms that date to Mitt Romney's time as governor. Yet the state stumbled when reworking the site to adopt the federal law enacted under President Obama. This week, Massachusetts decided to end its relationship with CGI, the same consulting firm responsible for the rocky initial implementation of the federal HealthCare.gov website and several problematic state efforts.

[Does the Affordable Care Act jeopardize the security of patients' health data? Read Obamacare Vs. Patient Data Security: Ponemon Research.]

Oracle, IBM, and Xerox have all come under fire for their roles in these implementations. Meanwhile, Deloitte is the one IT consultancy that came out smelling like a rose, having worked on the best-performing exchanges in Connecticut, Kentucky, Rhode Island, and Washington. In every case where vendors are blamed, there's room for debate about whether state officials should be taking more responsibility for lack of oversight or for changing requirements while the project was underway.

In Oregon, former Oregon Health Authority CIO Carolyn Lawson has filed the initial paperwork for a lawsuit against the state, alleging that the blame for the project's failures was directed at her after she resisted cooperating with a "coverup" of the truth. Part of what she is disputing is the division of responsibility between her former agency and Cover Oregon, the organization set up to administer the health insurance exchange program. Cover Oregon officials have said they were kept in the dark about problems with the system during a period when OHA oversaw the IT project. Lawson said Cover Oregon officials were intimately involved and caused some of the problems by not setting clear and consistent requirements for the project.

A federal review of the project aimed more blame at Oracle for poor performance and Cover Oregon for poor contract administration. However, a review of the contract's history by The Oregonian found some of the problems began when OHA tacked the Cover Oregon implementation onto a previously planned project to revamp the state's health and welfare systems. Cover Oregon never took steps to tighten those controls, according to that report.

In February, Maryland decided to fire health insurance exchange contractor Noridian Healthcare Solutions. Now, while continuing to work on repairs to the website, Maryland officials are considering hiring the organization behind Connecticut's exchange, one of the most successful in the nation, to take

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David F. Carr oversees InformationWeek's coverage of government and healthcare IT. He previously led coverage of social business and education technologies and continues to contribute in those areas. He is the editor of Social Collaboration for Dummies (Wiley, Oct. 2013) and ... View Full Bio

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David F. Carr
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David F. Carr,
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3/21/2014 | 1:46:25 PM
Re: Lessons learned
The Oregon story is also about trying to "save money" by not hiring a system integrator. They've paid for that decision in so many other ways.
WKash
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WKash,
User Rank: Author
3/21/2014 | 1:10:01 PM
Re: Lessons learned
David, you're probably right about Mass.  Interesting to note how Oregon Gov John Kitzhaber fired the head of the state's online healthcare exchange, and according to a report today in the Washington Post, the state had to hire 500 employees to process 157,000 applications by hand.
David F. Carr
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David F. Carr,
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3/21/2014 | 12:26:21 PM
Re: Lessons learned
In terms of underestimating the challenge, I have to wonder if the Massachusetts folks also thought the project was no big deal because they'd already done it before.
WKash
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WKash,
User Rank: Author
3/20/2014 | 7:11:37 PM
Lessons learned
David, I think you hit on some good reasons why so many states failed here:  The Feds left the door open to the states to do as they saw fit, but the states were ill prepared to take on the kind of projects these exchanges ultimately became.  That Massachusetts, the state that should have had the most experience, and usually has a good IT record, failed to deliver here also suggests the complexity of these sites -- as you say, they are far more than just web sites.  One would have thought experienced hands could have seen that coming.

The bigger failure in a way is that so much duplicative effort went into buiding these sites. I think you're right, the fact that politicians got to spread a lot of money must have seemed attractive at first.  But it looks like they mostly threw the money down the drain.
Alison_Diana
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Alison_Diana,
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3/20/2014 | 2:29:49 PM
No Best Practices
In most cases there seemed little use of best practices, for whatever reason. I'm sure, over time, universities and agencies will dissect these rollouts and discover many places where communication broke down, planning was poor, goals misstated, and testing undone, among other mistakes. 
Research: Healthcare IT Priorities
Research: Healthcare IT Priorities
Meeting regulatory requirements barely inched out managing digital patient data as the top priority for our 363 healthcare provider IT pros.
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