Oregon moving failed exchange technology to state health authority

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131217_cover_oregon_ad_660The Oregon Health Authority will adopt Oracle technology that was the backbone of the state’s failed health insurance exchange to enroll the more than 300,000 state residents who qualify for Medicaid.

Alex Pettit, Oregon’s chief information officer, revealed the plan last week in an appearance before the Oregon Legislature’s Joint Committee on Legislative Audits, Information Management and Technology. It is expected to cost the state about $35 million to make Oracle’s system useable for the Oregon Health Authority.

According to the Oregonian, Pettit avoided questions from the committee regarding the state’s legal options against Oracle but instead focused on rebuilding the information technology that Oregon officials claimed did not meet expectations.

“What you’re asking for is a legal opinion,” Pettit said. “That’s outside my scope. When it comes to the development of IT it is good processes and practices that produce good results. That was one of the things we struggled with in this episode.”

“We can’t ever guarantee success in IT,” Pettit continued. But the state can take steps to ensure that if a project goes bad, “we can fail fast and fail small,” he said.

Oregon officials previously announced the state will abandon its self-built exchange after just one year for the federal government’s exchange. Despite spending nearly $250 million on the system, Pettit said Oregon would need to spend at least $78 million to get the project fully functional.

A third option, Pettit said, would be to adopt another state’s exchange, but that would cost an estimated $45 million, while moving to the federal exchange would be around $5 million.

The biggest challenge with moving to the federal exchange lies with the consumer. The approximately 75,000 state residents who signed up for commercial insurance through Cover Oregon will have to re-enroll in the federal plan.

Oregon was one of 15 states opting to build its own exchange instead of initially going with the federal model. The states that built their own platforms have seen varying levels of success, with some, such as Kentucky and California, flourishing, while those in Oregon, Nevada and Maryland are struggling.

Oregon’s exchange has been recognized as one of the worst in the country as citizens are required to use a time-consuming process that involves both using the website and submitting paper materials.

An independent investigation ordered by Gov. John Kitzhaber found state managers repeatedly failed to heed reports about technical problems that prevented the Cover Oregon exchange from launching. It also found Oracle did a shoddy job in building the exchange.

Five Oregon officials connected to the development of the Cover Oregon portal have resigned.?? Kitzhaber has insisted communications about the portal’s troubles never reached him as the planned Oct. 1 launch neared.

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Oregon, States
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