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Dayton says he didn’t learn of MNsure problems and contract changes until after launch

MinnPost photo by James Nord
Dayton: “In hindsight, as the problems unfolded, it appeared that we weren’t apprised of them until they had surfaced. And whether that was because the senior staff was not aware of them until they surfaced, or what, is something the Legislative Auditor should go in and review.”

Gov. Mark Dayton said Friday that he first learned at least six months later of controversial contract changes made by the state’s health exchange.

 He said he also didn’t know about the serious technical issues plaguing MNsure until after the exchange’s Oct. 1 launch.

 Dayton said he first heard about the contract shift in late October or early November. Before that, he said, it wouldn’t have occurred to him to question such a decision by MNsure.

At this point, the governor said, he didn’t know whether it was a good idea for the state to take over the project from its lead vendor, Maximus, Inc., early last year.

“When the problems persisted by … early November, and it became apparent they were not getting resolved or eliminated or new ones were coming up … that’s when these kind of arrangements became more concerning,” Dayton said at a Capitol press conference after highlighting a new Minnesota jobs initiative. “Certainly, at some point there, I was told about this.”

The governor also said he was unsure if senior MNsure staff were keeping him apprised of the serious issues with the exchange as soon as they came up.

He said he looked forward to an audit of the state-based insurance exchange that’s moving forward to provide answers.

“I thought [I was well-informed],” Dayton said. “In hindsight, as the problems unfolded, it appeared that we weren’t apprised of them until they had surfaced. And whether that was because the senior staff was not aware of them until they surfaced, or what, is something the Legislative Auditor should go in and review.”

Optum, a subsidiary of UnitedHealth Group, is doing an “end-to-end” review of MNsure’s systems that will in part take a look at the exchange’s contracting decisions.

The Office of the Legislative Auditor is also doing its own external review that will be much broader in scope than what is required in state and federal law.

The contracting change is one that lawmakers pushed MNsure officials on at an oversight hearing on Thursday.

Minnesota Management and Budget, which had oversight over MNsure in May 2013, was aware of the change, and Commissioner Jim Schowalter approves contract shifts, spokesman John Pollard said in an email.

“MMB was the lead agency on the MNsure project at the time the Maximus contract was adjusted,” Pollard said in a follow-up email. “Maximus was a business process expert and it was determined MNsure needed to shift to integration and implementation. The contract moved approximately $1 million from Maximus to EngagePoint for increased integration focus. MNsure opted for more time on integration and implementation, so the limited time we had set aside for testing would not be compromised.”

The governor also addressed a letter he sent to IBM Curam in mid-December outlining technical issues with key eligibility determination software that they provided MNsure. Dayton criticized the company in the letter for misrepresenting the completeness of its product and making it difficult for consumers to use MNsure.

Dayton told reporters on Friday that his intention wasn’t to single out IBM but to ensure that they fixed the problems that he’d raised. Shortly after the letter and further conversations with the firm, dozens of IBM experts landed here, where they have been working to fix the issues.

“It was not an attempt to shift any responsibility from MNsure and from ultimately myself and I’ve made that clear throughout,” Dayton said of the letter. “It’s also not an attempt to single IBM Curam out.”

“What I was trying to do and was successful in doing with that letter was getting the attention of IBM at the highest management level,” he added. “We’re not going to point fingers and assess who was to blame for what … we’re going to work together to get the site fixed and working the way it should.”

In addition to addressing issues with MNsure, the governor also declined to comment about a running mate for his 2014 re-election bid. Dayton is meeting with Lt. Gov. Yvonne Prettner Solon on Monday to discuss whether she wants to run again, and he said he wouldn’t talk about it until after the meeting occurred.

Comments (5)

  1. Submitted by Rebecca Hoover on 01/10/2014 - 05:40 pm.

    MnSure Problems Reflect Minnesota Government Problems

    April Todd-Malmlov should never have been hired as the Executive Director of MNSure because she simply lacks the information systems knowledge and skills needed to oversee the development of the MNSure system. She was hired because of her connections and a goofy notion that knowledge of health care economics can somehow allow a magical development of technical skills and abilities. This is hard to believe but, unfortunately, we see cronies all over the place in state government where they do not belong. Minnesota needs to revamp its civil service system and clean up the widespread problem with cronies and pretty face hiring practices.

    When push comes to shove, Minnesotans have to recognize that the 35E bridge failed for similar reasons. In that case, MNDot had too many cronies and pretty faces in key positions rather than engineers who were willing to blow the whistle when needed.

    Until the civil service problems in government are addressed, we are going to continue to see a lot of problems.

  2. Submitted by Mike Downing on 01/11/2014 - 09:02 am.

    Letter to IBM

    Governor Dayton’s letter to IBM was an example of his lack of leadership and lack of executive experience.

    I true leader and experienced executive would have summoned IBM executives to his office, gave them clear instructions on what he expected to be fixed and document the private meeting by handing his “letter” to the IBM executives directly. A true leader would have taken responsibility for the MNsure mistakes by his Executive Branch.

    The fact is IBM is 100X more knowledgeable of computer systems than any government bureaucracy. I blame the MNsure mess purely on our state government for not providing explicit deliverables, an explicit product definition and unqualified government employees in charge.

  3. Submitted by Paul Udstrand on 01/11/2014 - 09:37 am.

    Yes and no

    I don’t dispute Rebecca Hoover’s comment, but I would point out that this kind executive theory-cronyism-mediocrity actually emerged in the private sector first and was imported into government. This kind of executive mismanagement has been particularly rampant in the health care industry. Look at University Fairview and it’s recent escapades with bill collectors. A few years ago UF spent millions developing an inpatient medical records system that went “live” but was never used. This isn’t about government, it’s about a perverted health care system that’s trying to preserve markets instead of create a actual health care system.

    Meanwhile, I hate to say it but Dayton is kind of goofy sometimes. All this stuff goes live and then he doesn’t remember stuff after the fact. Like not remembering he was told the the e-gambling predictions were probably bogus, and that seat licenses for the Vikings stadium were part of the deal, and now this. I hate to say it but if he really didn’t know about MNsure’s problems, that’s actually worse as far as I’m concerned. This is probably the biggest program of his tenure, you don’t hand something like that off so completely to someone else. He’s better than Pawlenty but a lot of stuff seems to slip through the cracks. Obama made the same mistake, in his press conference a while back he said he was meeting with his Obamacare people once a month… once a month? This is the signature program of his presidency, the only thing he will do of historical proportions… should have been meeting at least once a week if not more. But this is typical American executive behavior.

  4. Submitted by William Pappas on 01/12/2014 - 07:28 am.


    I agee that Dayton is a little goofy and I don’t like his attitude. I suggest that he roll up his sleeves and simply work hard to get MNSURE corrected. Understand this: the problems of the website are technical and will eventually be fixed and the sign-up process will be smooth. When it is, the benefits of the ACA can more accurately be assessed. There are always problems with starting up a large publicly accessable internet site that involves navigation. This is true even if it is a government site or a private one. Dayton should worry less about CYA issues and more about fixing the site. I think Minnesotans can see past the conservative rhetoric spinning about the ACA. Over the next year results will be important.

  5. Submitted by Jon Lord on 01/13/2014 - 06:46 am.

    Most private industry companies are run by people who don’t understand what their product is. They rely on lower level employees to do that tedious business. It’s just the model of the American Company these days. Managers are hired who have little in the way of actual knowledge of the processes involved. There is little movement upwards in companies from the ranks of those who do the work itself so things aren’t going to work like one expects until they’ve been in ‘the field’ for a lot longer than most of us like. Most companies have a skeleton staff kept on hand and not a full complement of workers who’ll do the work on something like this. Those workers are picked from ‘separate’ contract houses. Not ‘hand picked’ but rather from those who are available at the time. It’s not unlike hiring ‘temp employees’ in the manufacturing fields. The term “beta testing” today means “after release” and not before. Same methods, same problems.

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