December 13, 2013

Tiny Vermont Gets $208 Million to Build Disastrous Obamacare Exchange; Where Are the Watchdogs?

In mid-November, Americans for Tax Reform compiled a list of federal spending on state Obamacare exchanges totaling a breathtaking $4.5 billion.

One number on the list stands out from the rest — and it’s not California’s, though its $910 million amout is awful, disproportionate, and surely highly wasteful (before considering scalability concerns, the fixed costs of building a web site should be close to the same regardless of a state’s population). The big eye-catcher is tiny Vermont’s staggering $208 million. The nation’s second-least populous state (626,000 as of 2012) has 0.2 percent of the U.S. population, but has received 4.6 percent of grants from the Center for Medicare and Medicaid Services. Though the Green Mountain State’s enrollment numbers have been among the country’s least embarrassing on percentage of the population, its exchange’s rollout has in many ways been as bad, if not worse, than HealthCare.gov’s, according to a December 10 Vermont Public Radio report which has garnered very little attention (HT Megan McArdle at Bloomberg News; bolds are mine):

Shumlin Administration Had ‘Red Flag’ Warnings About Health Exchange Early And Often

PeterShumlinVtGovWide

The (Democrat Governor Peter) Shumlin administration was warned repeatedly over the past year that staffing shortages, technical problems and other issues with its main contractor threatened the launch of the state’s health exchange, documents show.

A series of reports prepared for the Department of Vermont Health Access highlight continuous and growing concerns about the state’s ability to launch Vermont Health Connect on time, dating back to early this summer.

Gov. Peter Shumlin said on Vermont Edition Nov. 1 that he was unaware of problems with the exchange until after Labor Day. But a May 22 report advised top officials in the Department of Vermont Health Access to “elevate missed deliverable dates or milestones to highest levels within the State and CGI.”

CGI Technologies and Solutions, the contractor the state hired to build the exchange, repeatedly missed deadlines, shifted due dates and failed to effectively communicate, the reports show.

Yes, it’s the same “CGI” which has performed so poorly on HealthCare.gov.

The situation is so bad that the Governor Shumlin has been forced to invoke a legal “safety valve” which “will allow individuals who buy their own insurance and small employers to extend their current coverage plans until March 31, despite Dec. 31 expiration dates.”

McArdle at Bloomberg notes that “as soon as ACA waivers are available, supposedly in 2017, Vermont will move to a single-payer system.” Perhaps this explains why CMS was so generous to Vermont with its grant money. But I wouldn’t know, because it appears that no one in the press has looked into this. How unsurprising.

Cross-posted at NewsBusters.org.

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