Nevada Health Exchange dumps Xerox

Nevada’s health insurance exchange board voted unanimously on Tuesday to dump Xerox and go with a hybrid federal-state exchange to provide health insurance benefits under the federal Affordable Care Act.

The plan would use the front-end system of Nevada’s Health Link website to maintain some state control over the program but then actually enroll Nevadans in health insurance through the federal website

Board Vice Chairman Lynn Etkins said Xerox hasn’t said anything to convince her sticking with that company would make anything better than it has in the past six months.

“There are a lot of things that aren’t perfect but the current system is intolerable,” she said.

Xerox has battled since the rollout of the health insurance exchange Oct. 1 to make the call center and website work and allow people to sign up for health insurance. Board members were told the Xerox system is, in some situations, worse now than it was a month or two ago.

The company has been paid $12.3 million for the work it has done on the website and call center.

Interim Exchange Director Steve Fisher said federal exchange officials say they would back whatever decision Nevada makes.

Xerox officials including Dan Green tried to assure the board they have been making progress and fixing issues with the website but board members made it clear they have no confidence in the company’s ability to keep its promises and fix the system by the time the next open enrollment begins Nov. 15.

Nevada’s board voted unanimously to become a “state supported” exchange for 2015. Nevada will retain its status as a state-based exchange, but it will allow the federal government to determine eligibility and enrollment functions.

Remaining a state-based exchange means the exchange can keep monthly fees charged to policies to fund operating expenses. In April the board agreed to increase the monthly fee for a medical policy purchased through the exchange to $13, up from the current rate of $4.95. The board may consider whether it can reduce the increase because the federal government will assume some responsibilities.

Consumers will still access the exchange through Nevada Health Link, officials said.

In the meantime, the state will research and solicit bids to consider adopting a program successfully working in another state, an option that could prove costly, with estimates ranging from $40 million to $70 million.

The board also rejected Deloitte Consulting’s suggestion Nevada simply contract with it to bring its Connecticut computer system to Nevada, saying the $67 million price tag was far too expensive. And it rejected the Oregon plan to drop a state exchange and just move to the federal exchange to provide insurance, pointing out Nevada’s state law mandates a state-operated exchange.

Going to a hybrid system with the state webpage out front but backed by the successful federal system, the board said, gives Nevada more options, including the prospect of buying a successful state-operated system implemented elsewhere by a private vendor.

Xerox said it was disappointed by the board’s action.

“Xerox has been unwavering in its commitment to Nevada Health Link and to getting all aspects of the exchange right,” Xerox spokeswoman Jennifer Wasmer in a statement, adding the system has been instrumental in supporting Medicaid expansion. About 190,000 Nevadans have been deemed eligible for Medicaid through Nevada Health Link and more than 10,000 have signed up for private health coverage during the special enrollment period.

“These successes have been supported by more than 99 percent availability of the Xerox system,” she said.

“I haven’t heard anything or seen anything that’s going to make a difference,” Etkins said of Xerox.

Johnstone also said sticking with Xerox is not an option.

Even Sen. Harry Reid, D-Nev., weighed in, saying Xerox’s management of the system “has been a disaster and was the cause of considerable flaws and glitches on Nevada’s site.”

Reid was joined by Rep. Stephen Horsford, D-Nev., who said Xerox failed Nevada but said the Affordable Care Act has enabled thousands of Nevadans to have access to health insurance.