Md. votes to adopt health exchange software used in Connecticut

$40 million-$50 million contract being negotiated with Deloitte Consulting

April 02, 2014|By Andrea K. Walker, Meredith Cohn and Erin Cox, The Baltimore Sun

The board overseeing Maryland's health exchange voted unanimously Tuesday evening to scrap its dysfunctional website and adopt software developed by Deloitte Consulting and used by the more successful health exchange in Connecticut.

The software is free for Maryland to use but Health Secretary Joshua M. Sharfstein will negotiate an emergency $40 million to $50 million contract with the software company to develop the site. Isabel FitzGerald, secretary of the state's Department of Information Technology, who stepped in to help fix the exchange, will oversee the project.

The move comes a day after open enrollment under the federal Affordable Care Act ended Monday, when consumers still were having trouble with the glitch-prone website. Maryland is the first state with a troubled website to switch to another system.

"Our launch did not go as we had planned, our launch failed," Gov. Martin O'Malley said at a press conference after the vote. "We don't always succeed on our first try, but we don't give up. And we usually hit our goals."

The Democratic governor also blamed IBM and its software for the website's technical problems. "We take responsibility for fixing this, and we'll see IBM in court," O'Malley said.

IBM said in a statement that it went beyond its contractual obligations to help Maryland meet enrollment goals and that state officials didn't properly manage the exchange.

"In brief, the state's enrollment goal was reached despite its own failures of leadership," said IBM spokesperson Mitch Derman. "We will now turn our attention to a successful transition of the project."

While state officials hope the new system will be in place for the next open enrollment period that begins in November, critics said the project has been mismanaged and raised questions about the cost to move to another site.

The state has spent tens of millions of dollars on the existing site and now plans to ask the federal government for more money and its blessing to develop the new website. The exchange also might need up to $3 million in start-up money from the state for the new website.

Some questioned whether a new system would even work.

"The board was right to stop throwing away even more taxpayer dollars on a system that does not work," said Rep. Andy Harris, the lone Republican in the state's Congressional delegation who has pushed for a move to the federal exchange.

"Regrettably, as opposed to joining the federal exchange, going with the Connecticut technology will still cost Marylanders tens of millions of dollars more," he said. "Plus, there is no assurance it will work in Maryland given the short time until the new open enrollment period this November."

Even Democrats who were strong supporters of the Affordable Care Act chaffed at the way the system was set up.

Senate President Thomas V. Mike Miller questioned why government officials oversaw the creation and launch of the website rather than somebody from the private sector with information technology experience.

"The rollout of this leaves a lot to be desired," he said. "You can blame it on the contractor, blame it on the subcontractor, but the buck stops with state government. And it hasn't been done properly. State money has not been used wisely, and we need to move forward as expeditiously as possible in getting this right."

Exchange officials had considered moving to the federal portal or fixing the current site.

But fixing the current site would have cost $66 million and taken a year to complete, putting the state beyond the next open enrollment period, exchange officials said in a memo. Moving to the federal site would have cost as much as $53 million, also would have taken too long, and would have required the state to build a separate system to handle Medicaid.

The website crashed immediately after launching Oct.1 and has been riddled with technical problems ever since. The exchange's executive director resigned under pressure, and officials later fired the website's main contractor, Noridian Healthcare Solutions, because of the problems.

The state has spent $125 million in mostly federal funds on the exchange, including about $55 million to Noridian.

Noridian had used IBM software to determine eligibility for subsidies. Exchange officials now say that software is to blame for ongoing troubles and may seek to recoup money from contractors.

"We would like to be sitting here and saying 'Wow, Kentucky and Connecticut saw that Maryland worked well,' but our contractors let us down on that score and did not deliver that which they promised," O'Malley said. "And then when they said they could fix it, were incapable of fixing it. This is the real world, this is sometimes how things happen."

Noridian has said it also complied with contractual obligations despite constant changes by the state.

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