Board funds health exchange move away from Xerox

The Board of Examiners on Wednesday approved a $16 million contract with Deloitte Consulting to move Nevada’s health insurance exchange away from Xerox and onto a hybrid state-federal system.

Once approved by the federal government and the legislative Interim Finance Committee, the system must be ready by the time open enrollment begins for the 2015 plan year next November.

“We have to run hard,” said Health and Human Services Director Mike Willden of the short time line.

The hybrid system was approved by the Silver State Health Insurance Exchange board of directors after repeated problems with a Xerox system that failed to efficiently allow Nevadans to enroll in federally mandate health insurance plans.

Deloitte will disconnect the system from Xerox and connect it to the federal system, creating what is called a Federal Supported State Based Market Place.

Altogether, Willden said, this addition in funding will bring the total cost of making the switch to $28-$29 million. He told the board headed by Gov. Brian Sandoval the $16.48 million in the Deloitte contract is new spending caused by the decision to change to the hybrid system. But he said the vast majority of that, 90 percent of the total, is federal money.

To raise the state’s share, he said, he will be asking IFC next week to approve the use of some freed up money, about $2.3 million in General Fund, in the welfare budgets and a piece of child support collections worth about $500,000.

To prevent a recurrence of the problems that developed in the Xerox contract, Willden said the plan comes with a separate $450,000 contract with Public Consulting Group, an independent corporation hired to monitor the design, development and implementation of the new system.

For the remainder of this plan year, he said, the state is still using the Xerox system. For plan year 2015, he said the system will become the hybrid operation.

He said he has confidence Deloitte can get the work done because that company built Nevada’s welfare and Medicaid systems and also built the federal hub that will be behind the face of the new Nevada exchange.

As part of the project, Willden said the state will be building its own call center. Unlike the original Xerox call center, he said this one will start with about 600 phone lines to handle heavy traffic.