After $300 million, thousands of hours of labor and a few lost government careers, one of the biggest disappointments in progressive health policy has reached the end of the road.
Cover Oregon, arguably the country's most dysfunctional health insurance exchange, is being dissolved as a public corporation. The state is now using of federal marketplace technology as a state-federal partnership exchange.
Effective June 30th, the Oregon Department of Consumer and Business Services will assume remaining exchange duties, including enrollment help at a call center and website and contracting with insurers.
Cover Oregon was developed with considerable fanfare and resources--$300 million in federal funding--aimed at "writing a new chapter in Oregon health." Instead, the website launched and immediately failed to function as an online marketplace.
The enrollment of about 80,000 Oregonians in private exchange plans that Cover Oregon did achieve was dependent on manual applications. About 320,000 residents gained Medicaid coverage, although it's not clear how many used the exchange's enrollment.
Cover Oregon soon became victim to squabbling and litigation with the lead IT contractor, Oracle, which is still suing the state to recover more than $20 million. A number of high profile public officials involved in the management of Cover Oregon ended up resigning, including Oregon Health Authority director Bruce Goldberg, MD, and OHA CIO Carolyn Lawson. (Lawson maintains that she warned senior management of major problems with Cover Oregon's IT trajectory in the months leading up to open enrollment.)
Lost in the mess were some fairly grand health reform aspirations that would have added to some other ambitious policies in Oregon, such as the coordinated care organization program in Medicaid.
In a 2012 interview, Cover Oregon's first executive director, Howard "Rocky" King, said he envisioned the exchange as an "active purchaser" helping bring accountability to delivery systems. Among the ideas was a proposal to let public school employees buy exchange plans, but King's central goal was extending Oregon's rate review power to work with carriers and provider systems.
"Coming out, I don't have a lot of leverage, because I need carriers to participate. 2015, 2016, 2017 are really different. You're going to see a greater focus on the quality of value standards that we require of the carriers, and that they have to include in their contracts with providers throughout the state," said King,
who left the exchange in early 2014 to focus on treatment for cancer.
"Oregon's unique. When you compare Oregon to California, Arizona, Idaho, New Mexico, we are on the forefront of rate negotiation as a state, not just the exchange. In California, if Blue Cross wants a 30 percent increase, they'd put a 30 percent increase out there and do it. Nobody can say no to them, other than the politics. Oregon is not a state where there's two carriers. There's a good 8 to 10 major carriers; the market's evenly divided. These carriers know in Oregon that they don't have a lock on the market."