Shumlin Administration Touts Health Exchange Upgrades; Critics Unconvinced

Jun 1, 2015

Gov. Peter Shumlin says Vermont finally has the elusive piece of technology it needs to resolve problems on the state’s troubled health insurance exchange. 

It could still be months, however, before all Vermont Health Connect customers will enjoy the benefits. And critics aren't convinced this new fix will be the silver bullet Shumlin says it is. 

It isn't often the governor has good news to report about Vermont Health Connect. So when word arrived over the weekend that his team had developed the tool needed to streamline customer-service operations, Shumlin wanted to make sure Vermonters heard about it.

"The good news is that we now have the technology able to change circumstance, which should put an end to the huge frustrations that Vermonters have been feeling generally about trying to sign up for insurance products that they need," Shumlin said. 

Shumlin delivered the news at a morning press conference in Winooski, where the governor introduced a dozen or so of the state employees and contractors who have been putting in long hours in recent weeks to meet the May 31 deadline for what's known as "change-of-circumstance" functionality.

"When you talk about the frustrations that Vermonters have had with Vermont Health Connect, whether it's billing or other challenges, it almost always goes back to this function," Shumlin said.

"The good news is that we now have the technology able to change circumstance, which should put an end to the huge frustrations that Vermonters have been feeling." - Gov. Peter Shumlin

When people have a baby, for example, or get married or divorced, they need their insurance policies to reflect the new situation. But the automated updating system that Vermont Health Connect was built around never worked. And the manual workarounds instituted in its absence have led to cumbersome backlogs, billing errors and, in some cases, delayed access to care. 

"This is a really big deal in terms of giving the customer service folks the tool that they need to be able to deal with the folks that they have on the phone. And I can't promise it’s a light switch, but man, it is hugely better," said Health Care Reform Chief Lawrence Miller.

Change of circumstance, however, isn't quite ready for primetime. Miller says the state has conducted successful testing of the technology, but it hasn't yet been "validated" by the private insurance carriers to which the changes are being transmitted. 

Even if all goes according to plan, it'll be several weeks before exchange staff can use the tool to solve customers' problems, and months before customers can input changes on their own. 

Not until October will customers have assurance that changes made at the beginning of one month will take effect in the next. 

House Minority Leader Don Turner says Shumlin has inflated a minor triumph. 

"We have had all these promises from the Shumlin administration – 'Oh, they're going fix it, they're going to fix it, it's going to be fixed," Turner says. "It's these promises by the Shumlin administration that Vermonters have grown weary of. And I have as well."

Turner says he's far from convinced the new tool will be the cure-all for the exchange's woes. 
"So, I don't think this is a great thing to celebrate. I think that it’s just another tactic by the Shumlin administration to stall what's inevitably going to happen, that Vermont Health Connect is not going to be able to deliver," Turner says.

House Speaker Shap Smith previously said that if Shumlin didn't meet the May 31 deadline, he'd take steps to abandon the state-run exchange in favor of a federal version of the program. Smith says he's "cautiously optimistic" the governor has cleared the hurdle. But he says he'll be watching closely to see whether carriers such Blue Cross Blue Shield of Vermont and MVP corroborate the administration's claims of success.

Even if they do, Smith says Vermont is still far from mission accomplished – Shumlin has until Oct. 1 to meet a deadline for having technology in place that will allow exchange customers to automatically re-enroll. Right now, exchange staff are using a laborious and costly manual process.

"I think we still need to look at potential other options, so that if this milestone doesn’t work out in the next week or two … or if we don’t meet the October deadline, that we have options to go to," Smith says. 

Reform Chief Miller says exchange staff will soon begin using the technology to work through a backlog of more than 10,000 people waiting for changes to their insurance policies. He says that process could take months to complete. Until the backlog is cleared, exchange customers won't be able to input change of circumstance themselves, as Vermont Health Connect had originally been envisioned.

Shumlin says annual operating costs for the $200 million exchange are comparable to what other states with custom-made programs are paying. Miller said hiccups along the way have no doubt inflated development costs. But he said he doesn't know, nor will he ever, how much more the state will spend as a result of the problems the site has encountered.

"Where we are is the best indication ... that we’ve had that the project has been turned around and is on a sound path to completion." - Chief of Health Care Reform Lawrence Miller

Vermont parted ways about a year ago with the tech firm originally hired to build the exchange, CGI. A firm called Optum has taken over the work.

"Turning around a troubled project is a lot harder than doing it right in the first place, Miller said. 

Miller said the ability to deliver change-of-circumstance functionality is symptomatic of the organizational competence that means better days are head for Vermont Health Connect.

"I think today’s step where we are is the best indication ... that we’ve had that the project has been turned around and is on a sound path to completion," Miller said.  

"I don't see any way we are going to get out from under having to expend millions of dollars on a system that should never have been attempted in the first place." - Senate Minority Leader Joe Benning

Miller acknowledged that structural problems remain. An outside firm is responsible for billing and collections, for instance, while the duty of sending late-payment notices or termination threats falls to the carriers. The lag between submission of payment and transmission of money to the carrier, then, can result in termination notices being wrongly sent to customers who have remitted payment.

Even if the Shumlin administration can get Vermont Health Connect running smoothly, Senate Minority Leader Joe Benning says it's an inherently flawed program. The exchange may be a good thing for people who qualify for federal subsidies offered for insurance products sold there. But for the rest of the Vermonters now being forced to purchase policies on the website, Benning says the program has reduced choice, and in many cases increased costs.

"Overall the concept to me is still a major concern," Benning says. "And I don’t see any way we are going to get out from under having to expend millions of dollars on a system that should never have been attempted in the first place."