It’s 11:59 PM on October 31, 2015, about 20 nervous state officials and contractors hunched around computer terminals in a non-descript office in the Charles F. Hurley Building near Beacon Hill. Among them was Louis Gutierrez, executive director of the Massachusetts Health Connector, appointed the previous February by newly inaugurated Gov. Charlie Baker. The launch of the third open enrollment since the 2013 implementation of the federal Affordable Care Act (ACA) was less than a minute away with lots on the line. Would months of hard preparation avoid another website calamity that could jeopardize health insurance for hundreds of thousands of Massachusetts residents.
As the website opened at midnight and kept humming without a hitch throughout the night and following days, sighs of relief were heard across the Commonwealth as a major governmental embarrassment was averted. By early February 2016, 201,000 state
residents had successfully enrolled in plans for 2016, including 36,000 new members. Today, the Connector is a marquee success for the still-youngish Baker administration — an ironic twist for a Republican governor who was never a fan of the ACA, Barack Obama’s marquee presidential achievement.
How did the Connector go from the Hurricane Katrina of Massachusetts state government to the Baker administration’s bright light? Many pieces came together, including a strong new governing and management team, smart strategic choices, relentless customer focus and, surprisingly, sticking with and completing the post-catastrophe course charted in early 2014 by Gov. Deval Patrick’s administration.
THE EXCEPTIONAL CHILD
The Connector, a governmental health insurance marketplace created by the 2006 Massachusetts Universal Health Care Law (aka RomneyCare) and reinvented via the ACA (aka ObamaCare) demonstrated to the nation between 2007 and 2010 that a state could reform and expand its market for individual health insurance by enabling consumers to make apples to apples comparisons and buy coverage in a user-friendly, web-based environment. Combined with premium subsidies for lower-income residents and a mandate on individuals, Massachusetts showed that a viable, bipartisan path to near-universal coverage could be successfully legislated and implemented.
In truth, only about 11 percent — or 46,000 — of enrollees in the early Connector days bought non-subsidized “Commonwealth Choice” coverage online; the rest got subsidized coverage that required personal assistance from live agents. Still, the state’s march toward near-universal coverage through the Connector won widespread applause, including the 2009 Innovations in American Government Award from Harvard’s Kennedy School of Government.
Massachusetts reform, including the Connector, became the prototype for the ACA’s coverage provisions that created new private health insurance options, including subsidies for income eligible households, an individual mandate, and a network of federal and state web-based “connectors” or “exchanges” or, later, “marketplaces.” With the ACA’s 2010 passage, Massachusetts Connector officials saw the opportunity to establish the Cadillac of exchanges with unsurpassed consumer benefits and other innovations. Under the new ACA model, everybody qualifying for coverage, whether Medicaid (MassHealth) or private insurance (subsidized or non-subsidized), would enroll through a “one-door” seamless website experience with integrated eligibility (IE).
THE CHILD STUMBLES
Ambitions jumped far ahead of technical capacity, timelines, and expertise. In October 2013, the new federal website built to serve 37 states crashed on day one, triggering a treacherous and humiliating episode in the ACA’s tumultuous implementation. For three months, the nation watched the Obama administration struggle to build a functional website so millions of Americans seeking to purchase individual health insurance could do so — a threshold achieved in late December. Less noticed until January 2014 was the accompanying collapse of state-sponsored websites in Oregon, Vermont, Minnesota, Maryland — and Massachusetts.
Massachusetts’s failure hurt the most. The state that had demonstrated the viability of a web-based insurance marketplace became immobilized, as consumers couldn’t enroll, even after hours or days or weeks of trying. Policyholders with serious health conditions could not document coverage to medical providers. Many paid premiums and watched the system eat their dollars and not document coverage or payment. In early 2014, desperate state officials began shunting up to 310,000 applicants into temporary and free Medicaid coverage — once overwhelmed state employees could process hand-produced applications.
Kate Segel, an enrollment manager at the advocacy group Health Care for All, remembers frantic attempts to reach Connector officials. “What’s going on, we asked? ‘We’ll get back to you,’ they said. They hid from the public, from providers, and everyone the extent of the problems,” she says. “We had people with urgent medical needs coming to us every day and we could not get eligibilities out of the system.”
ONE STEP AT A TIME
In February 2014, an exasperated Patrick sought outside help, recruiting Sarah Iselin, a Massachusetts Blue Cross Blue Shield official, as his temporary czarina to drive critical decisions. The first was basic: whether to continue a state exchange at all, or euthanize the Connector and use the “federally facilitated marketplace” (FFM) run by the US Centers for Medicare and Medicaid Services. Fully 37 states had opted for FFM — why not Massachusetts?
The answer involves something called “the wrap,” a crucial variation between the Massachusetts reform effort and the federal ACA. When Massachusetts launched its coverage program in 2007, it set enrollee premiums and cost-sharing at affordable levels based on each enrollee’s income, backed up by research on what families could afford to pay. Those affordability levels helped Massachusetts lower its uninsurance rate to under 3 percent, an unheard of level in US history. It turns out, the Massachusetts premium rates are far more affordable than the ACA ones that became operative in early 2014, and which were set to meet tighter politically-driven budget targets more than affordability standards.
Had Massachusetts shut the Connector, the state would have had no choice but to adopt the ACA’s far less affordable subsidy schedule, something stakeholders, including business groups and insurers, hoped to avoid. That meant that the Connector had to be fixed to save the more generous “wraparound” subsidies that were financed primarily with dedicated state revenues (e.g., tobacco taxes and penalties from individuals who do not obtain health insurance). In January 2015, the new Baker administration reaffirmed the Patrick administration’s decision to preserve the wrap.
The wrap decision was a key turning point. The next was to jettison CGI, the original firm hired to build the website that had been involved in the federal and multiple state website debacles. The administration hired hCentive, a Virginia-based software developer that makes cloud-based products for health insurers and states, to develop a new website. They also hired Optum, a UnitedHealth subsidiary, for project management. Iselin and her successor, Maydad Cohen, worked with Connector executive director Jean Yang and her staff to pull the project together. (Iselin now works for Optum and Cohen works for hCentive.)
Another decision was to continue developing an integrated eligibility (IE) system so that enrollees, whether seeking MassHealth or private insurance (subsidized or not), could enroll through the same virtual door. IE’s complexity was a major cause of the 2013 calamity; states that successfully launched their websites in late 2013, such as Connecticut and Kentucky, never attempted IE. The Massachusetts team chose to stick with it. Today, the Connector’s IE system is an asset for consumers and, increasingly, the envy of other states.
Though the Connector’s problems were far from over, corners were turned in 2014. I asked Louis Gutierrez, the Connector’s new executive director, assuming early 2014 was 0 and the best feasible system was 100, where would he peg the Connector in January 2015 when he took over, and where in early 2016. His answer: “45” for early 2015 and “85” for today.
THE BAKER TEAM TAKES OVER
It was Steve Kadish, Gov. Baker’s chief of staff and a former colleague of Gutierrez, who reached out and asked if he would become the Connector’s executive director. The Baker administration knew the Connector needed new leadership. “We were facing a house on fire,” Kadish recalls. “Literally, hundreds of people every day were calling the governor’s office in rage.” Gutierrez had worked as Baker’s chief information officer at Harvard Pilgrim Health Care after its near bankruptcy in 2000 and had served as Massachusetts’ chief information officer in the 1990s. He knew government, technology, rescues, and Charlie Baker. A determined “no drama” professional, he attracted a string of quality talent, including Vicki Coates as chief operating officer, and Patricia Wada as special assistant to the governor for project delivery.
Changes also affected the Connector’s board of directors. Prior to 2015, the state’s secretary of health and human services never held a seat on the Connector’s board, exacerbating tensions with its all-important partner, MassHealth. Baker appointed new HHS Secretary Marylou Sudders to chair the board and, from day one, she observed strained relations between the agencies and focused on fixing it. “It was sobering when we realized the severe impact the failure of the Connector had on MassHealth,” she says. “We reframed the Connector’s No. 1 goal to be customer service — it sounds simplistic, but this had not been central. We built up the call center and the telephone system and set up new open enrollment centers across the state.”
Coates, a health systems operations expert, describes a “relentless focus” on three things — improving member experience, attacking problems and not people, and using metrics to measure progress. In the first half of 2015, the team addressed systemic pain points that most hurt consumers; the second half was ensuring smooth open enrollment scheduled to start November 1. They performed massive system testing starting in July to avoid November surprises. The metrics shine: abandoned calls dropped from 131,792 in the 2014-15 open enrollment to 5,072 in 2015-16; the rate of dissatisfied callers dropped from 45 percent to 20 percent between January 2015 and 2016; of the 14,710 enrollees who used the Connector walk-in centers, 99 percent left satisfied or very satisfied.
From Sudders and Gutierrez on down, the Connector team recognizes that the system is far from perfect and needs substantial improvements. The website lacks credible provider search capability. Non-English speakers can’t use the English-only website. Paying premiums online is clumsy and slow. Much work remains to be done.
But while the Baker administration still struggles to get the MBTA, the Department of Children and Families, and other troubled agencies on track, the Connector, with a $230 million projected budget for FY2017, stands out as Governor Fix-It’s prominent success.
As the operational issues begin to settle, the state can start to resume its role as a national policy innovator. Already Massachusetts, along with Hawaii, is one of the first two states to seek an ACA waiver that permits states to vary from some of the federal law’s stricter insurance rule requirements. Though small ball, it may open a pathway for more substantive future policy ideas to improve both Massachusetts reform and the ACA. Ironically, if the ACA survives its final life-or-death challenge in the November federal election, Charlie Baker may turn out to be one of the leaders who helps to redefine the future of the law.
In the meantime, it’s no small achievement that Massachusetts residents who need coverage can again feel confident buying their health insurance through the Connector at www.masshealthconnector.org.