Coordinators scramble to ready technology, training, promotion efforts for insurance exchange
Just over two months remain before MNsure, the state’s federally mandated health insurance marketplace, is slated to open for business. But there remain numerous tasks that need to be completed before the Oct. 1 rollout.
Insurance companies and other organizations that will provide outreach to customers need to undergo training. A state-run call center, where the public can turn for help with questions about MNsure, must open. Details about the insurance products that will be available and how much they’ll cost need to be finalized. And most significantly, the state needs to make sure that the computer system that will be the backbone of the online insurance marketplace is operational.
Brian Beutner, the chair of the exchange’s board of directors, summed up the situation during testimony before the first meeting of the MNsure Legislative Oversight Committee on Monday. “They’re literally working around the clock to get up and running,” Beutner said. “It’s a little bit more hairy, quite frankly, than a typical startup.”
Seeking another $40 million from feds
So far Minnesota has received $112 million in federal grants to establish the exchange. That’s the 13th-largest amount nationwide, according to the Center for Medicare and Medicaid Services. Of that money, the state has spent $54 million; that leaves $56 million that hasn’t yet been disbursed.
At Monday’s oversight hearing, Sen. Michelle Benson, R-Ham Lake, questioned why more than half of that money hasn’t been spent with barely two months left before the exchange opens for business. “Are you going to spend all that money? Is there going to be a huge spike in spending that we’re going to see coming?” Benson asked. “I’m wondering why we’ve spent half and we have very little time to go.”
But April Todd-Malmlov, MNsure’s executive director, told committee members that it’s misleading to look at it as though half the federal dollars haven’t been allocated. That’s because contracts are backloaded to dispense most of the money only after contractors have finished their work.
“The structure of the contracts actually withholds a significant amount of money … until there is successful completion of those deliverables,” Todd-Malmlov said. “We anticipate that the majority of the spending will come around October 1 and later.”
Minnesota is now seeking an additional $40 million in federal grant dollars. That application is due by August 15. Eventually the exchange is expected to be financially self-sufficient.
In 2014, the state will impose a fee of up to 1.5 percent on plans purchased through the exchange. That figure will increase to up to 3.5 percent in 2015 and beyond. Todd-Malmlov indicated that it’s expected the fee will need to be between 2.25 and 2.5 percent in order to cover the ongoing costs of the exchange.
More than half of the money allocated so far ($51.9 million) has been dedicated to information technology. The state has contracted with Maximus to build the exchange system, which in turn has subcontracted with three other technology firms.
But a significant amount of money has also been devoted to hiring additional state employees. Currently MNsure has about 40 employees (“It changes daily, so that may be a little off,” Todd-Malmlov said) but expects to eventually have a staff of 85 to 90. In addition, roughly 30 employees of the state’s information technology agency have been hired to work on the exchange. In total, that’s about 120 state employees hired to get the exchange up and running.
That’s concerning to Benson and other GOP legislators. “A lot of money being spent on people who aren’t seeing patients,” Benson said, of the staffing additions. “They’re not delivering health care. They’re monitoring paperwork and web sites. You need people to do some of that, but there’s no incentive in government entities — particularly one that can basically set its own budget and has a perpetual funding mechanism — to optimize the workload for any employee and to make it run as efficiently as possible.”
Final preparations for the MNsure rollout will be begin in earnest next month. The advertising agency hired by the state to provide marketing assistance, BBDO, is in the process of making media buys. Training for brokers and other organizations providing outreach to potential exchange customers will occur in August and September. In addition, the recipients of $4 million in grants to bolster consumer outreach will be announced by Aug. 23.The state-run call center, where individuals and small businesses can seek information about MNsure, is slated to open on Sept. 3.
There are already signs that glitches should be expected when the marketplace opens for business Oct. 1. Todd-Malmlov told the oversight committee that the agency has scheduled three “patches” for the technology infrastructure in its first year of operations. That will allow MNsure to fix any glitches that surface and add functions that won’t be ready to roll out immediately. For instance, if someone’s eligibility status changes — because they have a baby, for instance — the computer system won’t initially be able to adjust their benefits package.
“As you can appreciate, getting something up of this magnitude during the period of time that we have is a major lift,” Todd-Malmlov said at Monday’s hearing. “So we have prioritized to make sure that the functionality that is needed to make sure that people get coverage, and [that] we’re able to test for the eligibility of that coverage, is front and center.”
Republicans question oversight
Monday’s hearing was the first formal opportunity for legislators to weigh in on the steps taken to build the exchange since legislation was enacted in March. But after the hearing, some Republicans questioned whether the committee has any meaningful oversight over the actions taken by MNsure’s board of directors. They point out that it has no ability to overrule the actions of the seven-member board, all of whom were appointed by DFL Gov. Mark Dayton.
“We don’t have a lot of authority,” said Benson. “The only way we can stop rules is to have a majority of the House and the Senate. They’d have to be in pretty egregious overreach, I think, to get the DFL to stop anything at this point.”
Sen. Sean Nienow, R-Cambridge, another committee member, voiced a similar sentiment. “Where does the buck stop on all of this? Because this oversight committee has no teeth,” Nienow said. “If the board doesn’t listen to what we suggest, if we don’t like what they’re doing, our only recourse … is to go change the law. Well, how’s that going to work when we’re not back in session until February?”
But DFLers say the role of the oversight committee isn’t to micro-manage the mechanics of the exchange, but merely to make sure that there aren’t significant problems requiring legislative action. “The role of the oversight committee is not to interject themselves into the decisions as they’re being made right now,” said Sen. Kathy Sheran, DFL-Mankato, who also sits on the committee. “Our oversight committee’s responsibility is to come back to the Legislature with its concerns, and I think that’s absolutely the right way to approach it.”