- Associated Press - Friday, April 4, 2014

PORTLAND, Ore. (AP) - Connecting Oregon’s health insurance exchange to the federally run marketplace would be the least expensive fix for the glitch-filled system, a report released Friday said.

It would take Cover Oregon five to eight months and $4 million to $6 million to link to HealthCare.gov, far below what it would take to correct existing problems with the online state exchange, according to an analysis by Deloitte Development LLC.

The exchange was supposed to allow individuals and small-business owners to buy insurance plans online, but it wasn’t ready to launch on Oct. 1 as planned. Oregon is the only state where the general public still can’t enroll online in health coverage in one sitting.

Fixing the existing website would cost $25.5 million to $57 million in development and maintenance costs just this year - not counting 2015 costs - depending on whether Cover Oregon keeps or replaces its main technology contractor, Oracle Corp., the report said.

Whether or not Oracle is replaced, completely fixing the existing technology would take a year and a half to complete - meaning the website would only be partially finished for the next open enrollment that begins Nov. 15.

The state has already paid Oracle $134 million for the exchange and is withholding $26 million.

It would take seven to nine months and cost $17 million to $20 million to buy and configure technology that’s already working in another state, such as Connecticut, according to the Deloitte analysis, first obtained by The Oregonian and dated Feb. 10.

Oregon could also contract out the entire exchange function, or just the non-functioning small-business part of the exchange, to an outside vendor. That vendor would host and maintain the website and own the technology, and Oregon would pay a monthly fee.

New Mexico’s exchange plans to use such a vendor in 2015 at a cost of $40 million, but the report says contracting out the entire exchange would risky.

But contracting out just the small-business portion of the exchange is low risk and would take five to six months to implement at a minimum cost of $18 million, the report says.

The state could also provide an additional enrollment channel that allows people to sign up directly with insurance companies at a cost of $2 million to $3 million. However, that option would still require Cover Oregon or the federal government to maintain an exchange.

“It is a preliminary report,” said Cover Oregon communications director Amy Fauver. “It’s part of a body of ongoing work that will be used by decision makers on how to move forward after open enrollment.”

Fauver did not indicate when Cover Oregon would decide on which option to go with.