Republican senators are demanding answers from the Obama administration on the handful of failed state exchange websites that have cost taxpayers literally billions of dollars. Some even say that the states should reimburse the government for the cost of these exchange failures.
So far, at least four largely inoperable state websites – in Massachusetts, Maryland, Nevada and Oregon – have cost the federal government $4 billion. That number is expected to rise as the states spend more money to replace or rebuild the bad sites.
“The massive amount of taxpayer dollars being spent on failing health care exchanges is unacceptable. The government has a responsibility to spend money responsibly and conduct oversight to ensure it is well used,” Sens. Chuck Grassley (R-IA) and Orin Hatch (R-UT) said in a joint letter on May 15 to Centers for Medicare and Medicaid Services Administrator Marilyn Tavenner. “It appears that the government is not carrying out its duty in the case of the state exchanges.”
The letter includes 10 pressing questions for CMS officials, including whether the states had any concerns about their websites before launching; whether CMS conducted any analysis of why some exchanges worked while others failed; and whether there’s information on how the agency oversees funding for each of the states exchanges.
The Kaiser Family Foundation has estimated that since 2011, the federal government has spent nearly $4.7 billion to help implement the exchanges. While some exchange websites, such as those in Oregon and Massachusetts, suffered from nightmarish technical issues, others performed quite well.
It seems to boil down to how well the states managed their contractors and exchange portals, since the Centers for Medicare and Medicaid Services gave them the freedom to oversee how the exchanges were designed and who would design them.
“CMS provided states with the flexibility to launch their marketplace in a way that made the best use of its system’s capabilities at the time,” a CMS spokesperson said. “One of the main advantages of operating a state-based marketplace was the ability to offer innovative designs that meet the needs of the states, its consumers, and its insurance market.”
Earlier this week, Sens. Orin Hatch and John Barrasso (R-WY) introduced legislation that requires states with failed exchanges to pay the government back the hundreds of millions spent on inoperable websites.
During a Senate confirmation hearing on Wednesday, Sylvia Matthews Burwell, President Obama’s nominee for HHS secretary, said that if nominated, she would look into who was at fault and recoup the money.
“Where the federal government and the taxpayer had funds misused, we need to use the full extent of the law to get those funds back for the taxpayer,” Burwell said.
Though most of the attention has focused on the four states with failing exchanges – Massachusetts, Maryland, Nevada and Oregon – the legislation also targets Hawaii, Minnesota, Vermont and the District of Columbia, which have all reported serious technical issues with their websites that hindered online enrollment.
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