No quick fix for state health exchange

There is no quick fix for Nevada’s troubled health insurance exchange, but speedy action by state officials on whatever course they decide to pursue is needed to prepare for the next open enrollment period this fall.

That’s the bottom line of an assessment prepared by Deloitte Consulting on the Nevada Health Link online web portal built and operated by Xerox. State health insurance exchange board members are expected to discuss the report when they meet Wednesday.

Deloitte outlines three options for the board to consider — fix the existing system, adopt a program successfully operated by another state, or join the federal online exchange.

Each has pros and cons.

Overhauling the Xerox program may be the least attractive, requiring “an aggressive timeline” with no comprehensive plan in place.

“The current project team has not proven they can successfully deliver the required management, processes or solution to successfully deliver an operational exchange,” the Deloitte report said. It also noted “trust issues” between the Xerox and users of the system, adding that unless those strained relationships can be resolved “the success of the project is not feasible.”

Xerox was awarded a $75 million contract to build and operate Nevada Health Link, the state’s online insurance marketplace set up as part of the federal health care reform law. But it was plagued by problems from the start, causing frustration and anger among consumers and insurance agents alike. Officials originally estimated 118,000 would sign up for coverage through the exchange when it went live Oct. 1 through March 31 deadline. But because of the bungled system, state officials gave anyone who tried unsuccessfully to enroll until May 30 to complete the process.

As of mid-April, about 45,000 had selected plans and 32,000 had paid for premiums.

Deloitte, a Xerox competitor, was awarded a $1.5 million contract in March to evaluate the exchange and recommend fixes.

There are more than 1,500 outstanding “defects” in the Nevada system, about a third of which are considered severe, according to the report.

Nevada could also transfer to the operating system of functioning state-based marketplace, an option that would require an immediate “go” decision to implement, the report said. That solution is a “good strategic fit” because operating systems have already successfully deployed elsewhere and Nevada would retain control over the exchange.

Lastly, Nevada could wash its hands of the project and transition to the federal marketplace. To do that, a transition blueprint must be submitted to the federal government by June 1 and additional money may be required.