The long-awaited health insurance exchanges, and in particular the federal HealthCare.gov, opened Oct. 1 in a tangled mess of poor software code, insufficient capacity and functionality and a lack of large IT project management best practices.
The botched performance was the Obama administration's worst nightmare for the most visible aspect of the president's signature accomplishment, the Affordable Care Act.
In congressional hearings in October and November, Health and Human Services Secretary Kathleen Sebelius, and Marilyn Tavenner, administrator of the Centers for Medicare & Medicaid Services, took their lumps from critics and responsibility for the rough debut of the federal exchange.
HealthCare.gov's technical problems have been getting fixed one by one as a surge of technology professionals have focused on a punch list to get the portal operating beyond just offering information or to compare prices.
Another explosive issue associated with the exchanges has been insurers sending customers cancellation notices for some existing plans. The notices began arriving in customer mailboxes in the fall.
Tavenner told lawmakers that those cancelled plans don't comply with required essential benefits and other provisions that improve coverage and protect consumers under the ACA. Insurers have referred individuals with cancelled planxs to HealthCare.gov, where they can buy insurance and may be eligible for subsidies.
State-based exchanges have fared better overall since they function at a smaller scale than HealthCare.gov. They appear to be on a rapid path towards smoothing out their processes and making enrollment quicker, said Caroline Pearson, vice president at Avalere Health.
"Our sense from the plans and the states is that the state exchanges' websites are working and are able to communicate enrollment information to the health plans, which can then finalize that process," she said.
"Years from now people will not remember what a mess it is," Pearson added. "We definitely see a lot of comparison with the Part D prescription drug plan, with a lot of confusion and consternation in the market about how the roll out occurred. Now there is very high satisfaction among beneficiaries for the program."
One bright spot in all the turmoil is premium rates, said Sandy Hunt, principal in PwC's health services industries' practice. The rates offered through the exchanges are attractive relative to what has been available in the market, she said. "That offers a great opportunity for consumers to look at what their current insurance coverage is and what they're paying for it."
Many large insurers view 2014 as a test year, participating in exchanges in six or eight states in the first year. "Most have indicated to us that they expect to add other states in future years, but 2014 is that trial period," said Ceci Connolly, managing director of PwC's Health Research Institute, adding that the introduction of exchanges is the "start of the marathon and not a sprint."