Massachusetts will run its own health insurance exchange and won’t need to join the federal HealthCare.gov website, state officials announced Friday.
A software system adapted for Massachusetts by the tech firm hCentive passed muster with the US Centers for Medicare & Medicaid Services in a test late Thursday, giving officials confidence that it will be ready when enrollment for next year starts on Nov. 15.
The decision marks an important step toward recovery from the embarrassing failure of the Massachusetts Health Connector’s refurbished website, launched last October.
“Massachusetts will remain a state-based marketplace,” Maydad Cohen, special adviser to the governor who is overseeing the project, said in a conference call with reporters Friday morning. “We’ve successfully demonstrated hCentive’s ability to deliver a smooth consumer experience.”
Significantly, that includes integrating the state’s unique subsidy program along with the federal tax credits, which reduce premiums. The federal exchange could not have incorporated the state subsidies.
Since the spring, the Connector had been following a “dual track” — working with hCentive, a Virginia company, to develop its own software while simultaneously preparing to join the federal website if that first option failed. Now, the state has halted preparations for HealthCare.gov.
In Thursday’s test, hCentive demonstrated that its software could handle the application process for complex family situations, and communicate with health insurers.
But, Cohen added, “I can’t breathe a sigh of relief right now. Nobody can.” He said any technology project can encounter problems leading to delays — but this one has a firm start date of Nov. 15. Starting on that date, he expects 450,000 people to enroll in insurance plans that take effect Jan. 1.
As Cohen described it, the software will enable consumers to enter their personal information and find a menu of options, displaying prices that take into account state and federal subsidies. The consumer will choose a plan, and that information will be sent to the selected insurance company, which will send a bill in the mail within three to five days. Once the bill is paid, the consumer will receive an insurance card in the mail.
If the prospective enrollee appears to be eligible for MassHealth, the state Medicaid program for low-income people, that person’s information will be transferred electronically to MassHealth. If MassHealth confirms eligibility — a process that could take as long as a day — the person will be notified by mail that he or she has been enrolled in MassHealth, Cohen said. If not, the person would be advised to return to the Connector website and sign up for a private health plan.
Asked about the decision to stick with a state-based exchange, Amy Whitcomb Slemmer, executive director of Health Care for All, a consumer advocacy group, said: “It’s been a while since we had really good news, and this is really good news. It’s going to be so much easier for people.” Slemmer said that Health Care for All expects to renew its contract with the state to provide outreach and enrollment help for the Connector.
“This open enrollment season is going to require all hands on deck,” she added.
The Connector decision was greeted with skepticism from the political right. Charlie Baker, Republican candidate for governor, said in a statement that when state officials launched the site last year they knew it wasn’t ready. He called for greater transparency this time, urging the Connector Board to “prove every aspect of the new site is ready to go before launching.”
Joshua Archambault, a senior fellow at the Pioneer Institute, a Boston public policy think tank, pointed out that there is “no final cost estimate for the rebuild, no clear understanding of what the federal government will pay for, and no Plan B if they fail again.”
Since 2006, the Connector had served people buying health insurance on their own and a few small businesses. But the program needed a major upgrade to comply with the federal Affordable Care Act, and the new computer system, made by CGI, crashed right out of the gate last October. Consumers seeking to sign up for coverage were never able to determine whether they were eligible for subsidies or Medicaid.
To ensure people kept insurance coverage, the state extended the Commonwealth Care program of state-subsidized coverage, which was supposed to end last year, and also enrolled people who might qualify for assistance in a temporary MassHealth program. Both these programs, with nearly 100,000 in Commonwealth Care and 250,000 in temporary MassHealth, end on Dec. 31, and transitioning people to new coverage is expected to pose major challenges.
The state plans an education campaign to let people know they must submit new applications and to urge them to start early, Cohen said. The system is being tested to ensure it can handle large numbers of users at once.