- Associated Press - Wednesday, January 15, 2014

SALEM, Ore. (AP) - State lawmakers grilled the leader of Oregon’s troubled health insurance exchange Wednesday about whether Cover Oregon’s technology and reputation can ever recover from widespread problems with an online enrollment system.

Legislators said they’re concerned the problems will deter people from signing up, endangering the exchange’s long-term viability.

“We have a disaster on our hands, and it’s going to be very hard to spin this in a way that the public is going to want to get excited about it,” said Rep. Jim Thompson, a Republican from Dallas who has long supported the exchange.

Dr. Bruce Goldberg, acting director of Cover Oregon, said he’s planning for contingencies in case Oracle Corp., the state’s primary technology contractor, can’t fix the system in the next two months or very few people enroll in coverage.

Federal grants are funding Cover Oregon through the end of the year, but the organization will have to be self-sustaining by 2015 or ask the Legislature for money. Cover Oregon is funded through an assessment on every insurance plan it sells, so it can’t survive unless people sign up.

“We can only speculate about the ability to repair the credibility or not,” Goldberg said. “To do so is certainly going to take a tremendous amount of hard work over the coming months.”

Several Republican lawmakers asked whether it’s time to drop Cover Oregon and have the federal government run Oregon’s exchange instead, as it does for 36 other states.

One of them, GOP Rep. Jason Conger of Bend, who voted to create a state-based exchange in 2011 and is now running for U.S. Senate, said he’s “lost faith” in Cover Oregon’s ability to fix the problems. In a letter Wednesday, he urged Gov. John Kitzhaber to close it down.

“I don’t believe any more that it’s going to happen tomorrow or the next day or in six months,” Conger said. “I think Cover Oregon’s credibility with the public is probably destroyed irreparably.”

Goldberg said it’s too soon to discuss shuttering Cover Oregon, but he said his staff is beginning to look at backup options if the Oracle software isn’t working by the end of March. Those options could include using software designed by other states or the federal government.

“We’ve certainly made a large investment in this,” Goldberg said. “Part of the technology is working. I think that we will be at a point to make that decision over the next couple of months, and that’s why we’ve begun to make that planning.”

Rocky King, the director of Cover Oregon, and Carolyn Lawson, the Oregon Health Authority’s chief information officer, have resigned. Both cited personal reasons for their decision.

The online enrollment system now allows people select an insurance plan, but key parts of the process require human intervention. The state has hired or reassigned 400 people to do it at a cost so far of $3.3 million.

Using that process, Goldberg said Cover Oregon has now enrolled 65,000 people in health coverage, about 23,000 of them in private health plans. The rest were enrolled in the Oregon Health Plan, the state’s version of Medicaid. Another 118,000 people enrolled directly in Medicaid through a separate process that bypasses Cover Oregon.

Goldberg said he did not know how many of the 23,000 people who selected a private insurance plan have paid their premium, which is required before they’re officially covered.

Sen. Richard Devlin, D-Tualatin, said it’s now clear that there were doubts among Cover Oregon officials about whether the website would be able to launch on time, and the public should have been notified sooner.

“I’m just trying to find an answer (about) why somebody didn’t come forward and say the emperor has no clothes,” said Sen. Richard Devlin, D-Tualatin.

Goldberg demurred, saying that question is part of an outside review initiated by Gov. John Kitzhaber.

“I think that’s a question a lot of us have, I have as well,” Goldberg said. “I think that’s a big piece of what the governor has called for in an independent review.”

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