Oregon Abolishes Health Insurance Exchange

Today in Washington, D.C. - March 9, 2015:
The House will not be in full session until Monday, March 16. Legislators are in their districts for Constituents work week. LEt us know if you have an opportunity to meet with your representative and were not counting golf. fishing, etc. There will be a pro-forma House meeting at 12 PM on March 10, 2015.

The Senate will reconvene today at 2 PM. At 5:30, the Senate will vote on confirmation of Daniel Marti to be Intellectual Property Enforcement Coordinator and then will hold voice votes on 3 other nominees, including two nominees to the Farm Credit Administration Board.

The Los Angeles Times reports today, “A bill dissolving Cover Oregon, the state's dysfunctional health insurance exchange, has been signed by Gov. Kate Brown. The measure, which had bipartisan support, transfers responsibilities for the Oregon exchange to the state Department of Consumer and Business Services. . . .

“Cover Oregon was plagued by problems almost from its onset. No Oregonian was ever able to enroll online in a private plan under the Affordable Care Act because the state exchange never had a functioning website, forcing insurance seekers to file paper applications. In April, state officials voted unanimously to switch over to the federal health insurance exchange, HealthCare.gov., citing the high cost of trying to fix the problematic state marketplace. The Oregon exchange had cost the state $248 million.

“Additional controversy erupted in August when Oracle Corp., which was hired to create the exchange, sued the state agency in charge. The company alleged a breach of contract and accused then-Gov. John Kitzhaber of attempting to ‘vilify the company in the media.’ The state responded with a lawsuit of its own, accusing the Redwood City, Calif., company of lying to Oregon officials, failing to deliver on contracts and filing about $240 million in false claims.”

Recently, the AP broke down how much the failed, now-defunct exchange cost taxpayers in Oregon and across the country:

• $240 million — amount Oregon paid to Oracle for developing both the exchange for individuals and small businesses and for public assistance modernization projects. This was funded in part by a $300 million federal grant. The remainder of the federal grant went for salaries, marketing, communications, community grants and other administrative costs.
• $23 million — additional state money spent on the failed modernization technology project.
• $9.1 million — spent through the end of 2014 to hire hundreds of temporary workers to manually process paper applications.
• $6.6 million — amount Cover Oregon paid Deloitte to assess glitch-filled exchange and provide future options for the state, as well as to transition the state to HealthCare.gov.
• $1 million — amount paid for independent assessment of Cover Oregon project by First Data, and for services of turnaround expert Clyde Hamstreet and his team who took over Cover Oregon’s reigns at the height of its failure last spring.
• $1.9 million — attorney’s fees for legal fight against Oracle and federal criminal investigation into exchange failure.”

And of course, there’s still millions more that will still be spent fixing this expensive failure. At least $30 million more will be spent to adapt another state’s Medicaid system. And then there are many as yet unknown costs for everything from building a small business exchange website to legal fees for the lawsuits involving Oracle.

Recall that Oregon Democrats were among the first and most enthusiastic adopters of Obamacare. The failure there has been costly to Oregon taxpayers and less than helpful for those needing healthcare or who had health care they already liked.

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