Cover Oregon Budget Troubles | 101 KXL

Cover Oregon Budget Troubles

Written by FM News 101 KXL on April 23, 2014

Story Contributions from OregonLive

Money or technology? This is the big question coming up friday, when the Cover Oregon board decides whether to give up on its buggy, incomplete health insurance exchange and switch to the federal version.

An advisory committee will hear from staff,  on thursday, the odds that more two+ years/$130 million worth of work by Oracle Corp, is salvageable by the next open enrollment period, which begins in November.

The greater concern might be, what will be the cost for salvaging Oracle’s work? The question is raised by far lower than expected enrollment numbers, and have Cover Oregon quietly grappling with a budget crisis.

“There’s an IT decision and a business decision (to be made)”, says Clyde Hamstreet, consultant contracted recently to helm Cover Oregon. “We’re just trying to figure out what our options are.”

Oracle and the state have signed an agreement to part ways, leaving Cover Oregon with two poor options.

Moving to the federal health insurance exchange means a loss of control and less capability, but it also offers certainty and a lower cost, estimated by the state’s consultant Deloitte as $4 million to $6 million.

Another option — implementing another state’s technology — has been rejected by the state as too expensive. Deloitte’s report had estimated the costs at $17 million to $20 million.

To date, Cover Oregon has signed up more than 63,000 people for private insurance, which generates a per-member per-month fee of $9.38 for the exchange. However, that figure runs behind projections and the lag is only going to get worse.

The Cover Oregon technology work group meets at 10a.m. Thursday at Cover Oregon headquarters in Durham, 6760 SW Upper Boones Ferry Road

The Cover Oregon board will consider the work group’s recommendation Friday at 10 a.m., also at its headquarters.

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