State hires contractor to clear Vermont Health Connect backlog


The state of Vermont is hiring yet another IT contractor to help manage problems associated with the health exchange website Vermont Health Connect.

The contractor, Optum, is a subsidiary of United Health Care, the second largest health insurance company in the United States. Sources say Optum will employ as many as 150 workers to eliminate a backlog of "change of circumstance" issues. The Vermont Health Connect website does not allow users to notify insurance companies of divorces, marriages, births, address changes and other life circumstances. About 10,000 Vermonters insured through the exchange are affected by the problem, according to state officials.

Optum employees will also help the state with project management for CGI, according to several sources who are familiar with the ongoing negotiations with the company and who asked not to be identified.

CGI, the Canadian firm that built the website, has been working on Vermont Health Connect for more than a year and has yet to launch change of circumstance functionality for the website.

Mark Larson, commissioner of the Department of Vermont Health Access, told reporters on Tuesday afternoon that he could "not get into detail" about the contract (its duration, total cost and even the name of the firm) because the state and the company have not yet inked a deal. Sources say negotiations will be complete before the end of the week.

Larson said the company did not go through a request for proposal process but instead used a modified bid process for vendors.

The funding for the additional IT services will come from "existing authorized exchange grants" from the federal government, Larson said. Some of the money has been reallocated, he said.

"We are in process of updating our grant request with the Centers for Medicare and Medicaid to address the reallocation," Larson said.

No funds from the CGI contract, which is worth $84 million, will be diverted to the new contractor. The state has so far paid CGI $51 million, and fined the company $5 million for delays.

When asked whether CGI would meet a July 2 deadline, Larson equivocated. "There's a lot of work left to do," he said.


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