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Lawmakers want MNsure answers, but few have been forthcoming — yet

Both DFL and Republican legislators questioned MNsure’s past missteps — and future concerns about its long-term solvency.

“It’s disappointing that they haven’t been forthright,” said Sen. Michelle Benson.
MinnPost photo by James Nord

Lawmakers want answers about who was in charge of key contract changes at Minnesota’s health insurance exchange.

But they didn’t get much clarity at Thursday’s meeting of the MNsure Legislative Oversight Committee.

Meeting for the first time since the marketplace’s Oct. 1 launch, members did say that transparency from exchange leadership is improving dramatically.

Thursday’s session was a wide-ranging inquiry — filled with criticisms from legislators of MNsure’s past performance — and a discussion of future issues, including the exchange’s less-than-assured fiscal solvency.

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“There were a lot of hard questions that were asked,” DFL Rep. Joe Atkins, who co-chairs the committee, said after the meeting. “We’re starting to get some sound responses, and we’re starting to get some concrete steps that are being taken to address some of the stubborn issues, particularly on the IT side, so that would-be customers can get to those low rates that are just sitting there.”

Both DFL and Republican lawmakers questioned MNsure’s past missteps. Legislators also asked why the state decided to take over construction of the exchange from its lead vendor, Maximus,Inc., last February.

“Just in the last couple of days, the public has become aware that there was a change in the contract for the software vendor,” said GOP Rep. Joe Hoppe. “It hasn’t been really clear to me – and I hope it’s clear to you – I’d like to know who made that decision, who OK’d that, who had some oversight?”

leitz and beutner
MinnPost photo by James Nord
Interim MNsure CEO Scott Leitz, left, and governing board Chairman Brian Beutner couldn’t explain who authorized key changes in the exchange’s software contract.

But the MNsure leaders who addressed the committee, including interim CEO Scott Leitz and governing board Chairman Brian Beutner, couldn’t offer an explanation. Leitz took over last month, and Beutner wasn’t in office at the time the contract changes were made,

April Todd-Malmlov, the exchange’s former leader who stepped down last month, hasn’t been available for comment.

“The hand that we have been dealt is what we are trying to improve upon,” Beutner said. “The direct answer to your question is: I do not know.”

The lack of information eventually led Hoppe to comment: “We have a board who apparently doesn’t know anything about anything.”

Maximus, in a letter to lawmakers on the committee, described the shift as a takeover of the exchange contract by the state. That sentiment also is reflected in a separate February email to state staff from Todd-Malmlov.

Minnesota Management and Budget, the agency overseeing the exchange at the time the contract change was made, has not commented yet on the contract shift.

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Representatives of the agency weren’t at the meeting to answer questions — although notice was short.

“It’s disappointing that they haven’t been forthright,” Republican Sen. Michelle Benson said after the meeting. She had requested that state staff attend to answer questions about the contracts.

Legislative Auditor Jim Nobles, who is beginning a broad audit of MNsure, assured lawmakers that he would strive for accountability. Nobles’ inquiry will be much more extensive than is legally required, he said, and will include a look at the contract issue.

nobles
MinnPost photo by James Nord
Legislative Auditor Jim Nobles, right, is beginning a broad audit of MNsure.

After the meeting, Nobles listed some of the questions his audit will address:

• “Who was in charge?

• “Who was ensuring that the money was being spent appropriately and that the contractors were delivering what they were supposed to?

• “So on the kind of oversight side, the MNsure side — who was in charge?”

MNsure will also be getting an “end-to-end” system review from Optum, a subsidiary of UnitedHealth group. The results of that review should be available next week. The exchange said the review would focus on software and contracts, system data and reporting, and project leadership.

Legislators also focused on older but still outstanding issues.

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Gov. Mark Dayton, for example, offered sharp criticisms of IBM Curam in a mid-December letter that was released last week. The company since has sent dozens of staff members to Minnesota to fix issues with their product, a key function that helps determine eligibility for MNsure programs.

Since the company’s “tech surge,” Dayton has praised its response.

“The majority of concerns with the Curam software that were expressed by Governor Dayton three weeks ago have been addressed,” IBM Spokeswoman Mary Welder said in a statement responding to Dayton’s letter. 

But, according to Leitz, many of the 21 issues Dayton outlined in his letter — critical functionality flaws — haven’t been fixed.

Leitz divided the issues into thirds. One group has been fixed. Another has fixes identified, but they likely would require more than a month of additional testing. The last group doesn’t have fixes identified.

Among the biggest questions lawmakers posed to the MNsure leaders is whether the exchange will be able to stay afloat in 2015. The exchange must be self-sustaining, funded through a premium withhold of up to 3.5 percent that begins next year.

The exchange, however, is missing even its revised, lower enrollment targets. Currently, Leitz said, the exchange is at 85 percent of its enrollment estimates. Those targets are even more conservative than the ones MNsure was originally operating from when the governing board began questioning whether there would be enough revenue to sustain the organization.

The “below the low,” estimates, as Benson referred to them, envision an average monthly enrollment of 132,000 Minnesotans in 2015, according to estimates drawn up by MNsure. The exchange predicts budget cuts of nearly $9 million that year even at a “medium” enrollment scenario with 246,000 average monthly enrollments.

The news prompted DFL Sen. Tony Lourey, who co-chairs the committee, to question whether the MNsure governing board would be returning to the Legislature to seek additional funding.

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“It is not our intent to come to the Legislature and ask for additional funds,” Beutner said.

But Benson said it might not be wise to handle the issues “in house,” as Beutner said he hopes will be possible.

“Just because he doesn’t intend to come to the Legislature doesn’t mean he shouldn’t come to the Legislature,” Benson said. “This organization has been given an unprecedented amount of latitude, and it hasn’t worked out very well.”