Insurers Worry About Big Gaps in Obamacare Site

This December 2, 2013 photo shows a woman in Washington, DC reading a message indicating that the insurance marketplace internet site has too much traffic to continue enrollment. The troubleshooter appointed by President Barack Obama to overhaul a bungled health care website rollout said Sunday that improvements had made a 'night and day' difference in handling online traffic. The White House has admitted previously that the launch of, where people can sign up for health insurance, was a debacle and the Obama administration pledged that the vast majority of potential customers would be able to enroll online by the end of November.
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Sam Baker
Dec. 2, 2013, 3:55 p.m.

In­sur­ance com­pan­ies are still wait­ing for key parts of Health­ to be built — and still hav­ing trouble with the parts that are in place.

Im­port­ant pieces of the Obama­care site are still glitchy, or miss­ing al­to­geth­er. And the site’s botched rol­lout is hardly boost­ing con­fid­ence in the vi­tal com­pon­ents that still need to be built, in­clud­ing the sys­tems for pro­cessing pay­ments to in­surers and squar­ing away the de­tails of who has en­rolled in which plans.

Both sys­tems are cru­cial to the in­sur­ance in­dustry, which needs to col­lect premi­ums so it can pay out claims. And car­ri­ers are still wait­ing for the delayed pro­cess of re­con­cil­ing their en­roll­ment in­form­a­tion with the fed­er­al gov­ern­ment’s data. As the rest of Health­ struggles to get off the ground, people in and near the in­sur­ance in­dustry are nervous about the delays and about how well those sys­tems will work once they’re in place.

“They don’t have a very good track re­cord of build­ing and test­ing sys­tems, giv­en what we’ve seen so far, so that is cause for con­cern,” an in­dustry of­fi­cial said.

An­oth­er cause for in­surers’ anxi­ety: CGI Fed­er­al — the con­tract­or that has come un­der fire for its work build­ing the bulk of Health­ — is also in charge of build­ing the pay­ment and re­con­cili­ation sys­tems.

Re­con­cili­ation is the pro­cess by which in­sur­ance com­pan­ies and the fed­er­ally run in­sur­ance ex­change iron out any dis­crep­an­cies in en­roll­ment in­form­a­tion — mak­ing sure, for ex­ample, that the same per­son isn’t ac­ci­dent­ally en­rolled in two policies, and that the con­sumer and the in­sur­ance com­pany got the same in­form­a­tion about the size of any sub­sidies.

Con­sumers have to pay their first month’s premi­um by the end of Decem­ber for their cov­er­age to take ef­fect on Jan. 1. And to make sure that the right people are pay­ing the right amount for the right policy, in­surers and the gov­ern­ment need to re­con­cile their in­form­a­tion. The pro­cess was sup­posed to start this month, but in­surers are now skep­tic­al that will hap­pen. And they haven’t got­ten word of any backup plan.

Gaps in en­roll­ment in­form­a­tion seem likely, giv­en the myri­ad prob­lems Health­ has had in sub­mit­ting com­plete, ac­cur­ate re­ports to in­sur­ance com­pan­ies about the few people who have man­aged to sign up through the web­site.

In­surers say the re­cords — known as “834” trans­mis­sions — are im­prov­ing but have been rife with in­ac­curacies or miss­ing ne­ces­sary in­form­a­tion.

The Cen­ters for Medi­care and Medi­caid Ser­vices said Monday that it had iden­ti­fied — and fixed — a single glitch re­spons­ible for the vast ma­jor­ity of the site’s back-end er­rors. A soft­ware bug that pre­ven­ted So­cial Se­cur­ity num­bers from ac­com­pa­ny­ing the re­ports was re­spons­ible for about 80 per­cent of the prob­lems, CMS Com­mu­nic­a­tions Dir­ect­or Ju­lie Ba­taille told re­port­ers.

She could not spe­cify the over­all er­ror rate for sub­mis­sions to in­sur­ance com­pan­ies, even though CMS would have to know that to as­sert that it had solved 80 per­cent of them.

Even as en­roll­ment sub­mis­sions are im­prov­ing, however, in­surers are still wait­ing for an­oth­er big part of the sys­tem: the part that pays them. Most people who buy in­sur­ance through Health­ will be eli­gible for a sub­sidy to help cov­er the cost of their premi­ums. But CMS hasn’t yet built the sys­tem that trans­mits sub­sidy pay­ments to in­sur­ance com­pan­ies.

In­surers are sup­posed to re­ceive their first pay­ments in Janu­ary, and they’re count­ing on the money to be there. Oth­er­wise, they’ll be pay­ing out claims for cus­tom­ers whose premi­ums haven’t been fully paid.

In­surers will be paid on time, Ba­taille said. CMS is piggy­back­ing off Medi­care’s pay­ment sys­tem to pro­cess pay­ments in Janu­ary while it “builds out” the auto­mated sys­tem that’s sup­posed to handle sub­sidy pay­ments un­der the Af­ford­able Care Act, she said.


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