Continued Problems with Maryland’s Health Care Exchanges

Continued Problems with Maryland's Health Care Exchanges

The main contractor behind designing and operating Maryland’s online health insurance marketplace, Noridian Healthcare Solutions, LLC, has recently been fired. The $193 million dollar contract was terminated late on Sunday, February 23rd, by the Maryland Health Benefit Exchange, whom oversaw the state’s exchanges.

In spite of the turmoil, the state further conceded that they remain unsure how much it will cost to obtain a fully functional site. According to a report filed by the Washington Post, as of February 10th, Maryland has already paid Noridian $65 million, in addition to accruing $13 million in unpaid invoices.

A top Maryland official confided that Noridian “severely misrepresented the maturity” of the type of system it could build. Furthermore, Noridian hired a subcontractor to complete the main work on the site, a move that has only added to the frustration Maryland lawmakers have for Noridian.

In another report filed by the Post, Maryland taxpayers have already been billed with $30.5 million in unnecessary Medicaid payments. The current costs and dollars spent were outlined in the last week of February during a routine budget review.

The new main contractor hoping to breathe life into the plagued exchange systems is Optum/QSSI, a software engineering company based in Columbia. The Maryland-based software giant is, however, not exactly new on the scene. Optum/QSSI was called upon by the state last December to aid in fixing the flawed website. Optum/QSSI is an aggregate software engineering company, composed of Quality Software Services Inc. (QSSI) and OptumInsight. Both companies specialize in the type of work they are going to be doing for the exchanges.

In an interview with the Washington Post, Isabel FitzGerald, who is the state’s secretary in charge of information technology, said, “We worked very hard with [Noridian] to find a path forward. And the decision now is that we are just not making the progress that we had hoped.” Only 14 other states opted to set up their own online exchanges. Many states have chosen to utilize the federal online exchanges.

As any Marylander is aware, there have been major problems in the roll out of the state’s health exchanges. Some House Republicans, notably Del. Michael J. Hough of Frederick and Washington counties, have introduced a bill (HB1229) to do away with Maryland’s exchanges altogether. In spite of all the trouble, one thing is for sure: if Optum/QSSI cannot fix the site in a short period of time, the future is uncertain for the exchanges.

For more information or questions, you can contact Mark Rapson,  410-307-6418 or mrapson@katzabosch.com.

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