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Despite a decision to shift Cover Oregon to the federal health insurance exchange, the state's information-technology challenges are not over.
(Nick Budnick/The Oregonian)
With the next open enrollment for health coverage only months away, Oregon's decision to hook up to the federal insurance exchange for an estimated $5 million solves only part of the state's dilemma.
The remaining task could be tougher -- and more expensive -- than expected. The ballpark estimated cost for what Oregon still has to do is another $35 million, and officials acknowledge that figure could be conservative.
Not only that, but they aren't sure the work left to be done– to help Oregon Health Plan applicants -- can be completed in time for Nov. 15, when open enrollment begins again.
The federal website Healthcare.gov only assists people buying their own private plans. Only a fourth of those that used Cover Oregon fit that description. The rest will be kicked back to the state.
Oregon is still responsible for enrolling people whose incomes qualify them for the Medicaid-funded Oregon Health Plan – meaning $15,856 for a one-person household, or $32,499 for a family of four.
Oregon's $35-million estimate for Medicaid-related software development -- actually a range between $18 and $53 million-- gives a window into how challenging the job ahead could be. The price tag is the same amount that Texas spent to build a similar system from scratch.
The figure undermines a popular talking point of Oregon officials, that the $248 million spent on Cover Oregon wasn't all a waste. They've argued that, like pulling the engine from one car and installing it in another, some of the technology prepared by Oracle Corp. for Cover Oregon will be reused to enroll people into Medicaid.
"I think it is too early to determine whether the money has been wasted," Gov. John Kitzhaber said last week, adding that "the technology for Medicaid eligibility and enrollment" would be moved over to the Oregon Health Authority.
Officials say the system determining if someone is eligible for the Oregon Health Plan does work. However, there remain questions over how compatible other Oracle work for Cover Oregon is with what's needed at the Oregon Health Authority, according to documents and interviews.
And there's also a slew of brand-new work that needs to be done. For instance, the state needs to set up its own system to double-check whether the federal system correctly sent someone to the Oregon Health Plan.
"There's a whole new set of interfaces and ways of passing data back and forth that we're going to have to figure out," says John Koreski, the Oregon Health Authority's interim information-technology administrator.
Cover Oregon last week awarded a $3-million contract to the consulting firm Deloitte to spend the next six weeks preparing a "gap analysis" showing what Oracle technology can be rescued and what still needs to be done.
Then, the state will be back in a familiar position: trying to negotiate with a single vendor to finish the job in a non-competitive contract negotiation -- and do it in a very tight timeline.
The good news for state officials is that the federal government is expected to pick up 90 percent of the cost of the Medicaid system. The Oregon Health Authority has set aside $3 million to $5 million in general-fund dollars to fund its 10-percent share, according to state administrator Tina Edlund, who is overseeing the transition to the federal exchange.
But the next open enrollment period starts in just six months, and officials admit they can't guarantee the new Medicaid system will be ready by then. The backup plan would be to use pdf applications for applicants to fill out and send in, the same workaround used in the last enrollment period to bypass Cover Oregon's broken technology. The workaround has created major problems for the state's Medicaid program, including enrolling people who were not eligible.
Asked whether he's comfortable that the state can hit its goal, Koreski responded: "Am I comfortable today? Not as comfortable as I will be once we get through this gap analysis ... I can't say one way or another."
-- Nick Budnick