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Health exchange millions should sicken taxpayers

  • Post published:September 3, 2019
  • Post category:News

In 2010, when the Affordable Care Act (ACA) was signed into law, it required states to create health insurance exchanges for enrolling people in individual insurance plans. States were free to choose the design of their respective plans, with New Mexico selecting a federally supported, but state-run, health care exchange platform.

The New Mexico Health Insurance Exchange (NMHIX) was called BeWellNM and mandated by the ACA to be up and running by the open enrollment period of October 2013. But, by 2015, poor management during the construction of the site, low enrollment rates and missed budget deadlines ultimately led to millions of taxpayer dollars wasted on an ineffective website platform. Between 2010 and 2015, the state of New Mexico spent a total of $85 million to create the online health insurance exchange platform BeWellNM, with little to show for its efforts, and now they’re planning to spend more and try again.

A 2015 report from the NM Health Insurance Exchange (NMHIX) to the state Legislative Finance Committee outlines many of the missteps and lack of oversight that resulted in an obsolete and ill-performing health care exchange market with a hefty price tag. The report sites numerous problems that caused the waste of taxpayer dollars for a project that was slated to bring a cheap and efficient online health care market to New Mexico.

During the construction of the BeWellNM website, a lack of IT project oversight provided incomplete reporting to management, hindered decision-making and needed improvement to its information security. Additionally, the BeWellNM project was severely lacking in administrative program oversight and fiscal planning, which contributed to it being carried out ineffectively and over budget. According to the report: “For the first eight months of 2015, NMHIX did not have a firm budget and future spending decisions to achieve revised priorities remained uncertain.” Extensive marketing and outreach efforts also failed to produce the intended results; despite increased outreach to cover more of the state, new enrollments continued to decline in the second year of operation. In April of 2015, after two years of BeWellNM performing poorly, enrollment languishing and very little to show for the $85 million taxpayer dollars spent trying to make it functional, the Health Insurance Exchange Board voted to use the federal platform instead of the BeWellNM website. The Health Insurance Board cited the platform as a less costly alternative for the state. But, starting in 2018, federally supported state-based exchanges like New Mexico were required to pay user fees to the federal government for use of the national website amounting to 3% of premiums. In 2018, that cost New Mexico taxpayers $5.4 million and in 2019 the user fee is projected to be $10.9 million.

But the state spending on our health care market place doesn’t end there. Currently, the N.M. Health Exchange Board has unanimously voted to transition from its current design as a federally funded, but state-run, market place to a fully state-run health care exchange in time for the 2021 plan year. This means even more money, in addition to the $101 million that has already been spent, will be needed to revamp the entirety of our current state health care exchange.

As of May, the state has selected Virginia-based company “HCentive” to transition BeWellNM from a federal technology platform to one that will be operated locally. According to the Albuquerque Journal, the price tag for this next rebuild of New Mexico’s Healthcare exchange will be another $27.5 million. This most recent decision by the Health Exchange Board brings the total number of taxpayer dollars spent to over $125 million since the initial signing of the Affordable Care Act in 2010. How much taxpayer money will it take for New Mexico to get it right?

The New Mexico Business Coalition (NMBC) is the state affiliate for the National Association of Manufacturing.