Commentary: Time for Facts About Vermont Health Connect (March, 2015)

By Wendy WiltonWendy Rotator Card

It is good news that Auditor Hoffer has scheduled a performance audit of Vermont Health Connect this spring. The auditor’s work will be vitally important information for the Legislature to consider as it determines the fate of the state’s exchange. Hopefully, they will have his report before the session ends.

Much has been said and written about the problems with development and roll-out of Vermont Health Connect and the expected $200 million cost of this poorly managed effort. However, there could be more financial costs lurking on the horizon that the auditor needs to tell us about.

Vermont Health Connect has been dysfunctional from the start and still is. The backlog of coverage changes is over 11,000 cases. Enrollment, determining Medicaid and subsidy eligibility, changing eligibility and benefit profiles, processing premiums, and processing insurance claims, and other activities have all experienced failures. Participating insurers are owed millions of dollars in premiums, but have continued to pay for care. This will have negative impacts on other subscribers’ rates unless the state makes good on what it owes.

Auditor Hoffer should consider exploring these areas of concern:

  • How many and what is the value of premium payments processed through Vermont Health Connect that have not been reconciled and paid to Blue Cross Blue Shield and MVP?
  • Vermont Health Connect has been dysfunctional from the start and still is.
  • Where (in what account) is the cash representing unreconciled premiums?
  • How many and what is the value of provider payments made by BCBS and MVP associated with the above flawed beneficiary application and claim processes that remain unpaid?
  • Of those newly enrolled in Medicaid, how many have eligibility documentation that is inaccurate? What is the state’s financial exposure due to flawed Medicaid enrollments?
  • Similarly, how many and what is the value of paid premium subsidies associated with flawed income determinations?
  • The state has a significant ($57 million), no bid contract with Optum-possibly similar to the Gruber contract. What controls exist to ensure the invoices are detailed and accurate, work will be done on time and within budget, and that the contractor will deliver the solutions?
  • What is the per month-per member cost of Vermont Health Connect? How does this compare to BCBS and MVP’s per month-per member costs?

Three years ago, I concluded a single payer health care system would make the state insolvent due to unforeseen cost escalation, lack of savings, and unsustainable taxes. Vermont Health Connect represents a similar risk to the state’s precarious finances with unexpected costs and lack of control. The auditor’s report, if thorough and timely, could give the Legislature essential facts to take decisive and imperative action.

– Wendy Wilton, is treasurer for the City of Rutland, and a member of the Ethan Allen Institute board of directors.

 

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