A state board on Friday voted unanimously to negotiate with a California company to develop the framework for a marketplace New Mexicans will eventually use to purchase health insurance.
GetInsured.Com, based in Silicon Valley, beat out fellow finalist Deloitte after estimating it could create a working marketplace and maintain it over five years for $39.9 million, compared to the $60 million Deloitte proposed. Friday’s vote, by the New Mexico Health Insurance Exchange Board, was unanimous.
As visualized in the federal health care law, health exchanges such as New Mexico’s proposed marketplace are meant to help reduce the number of Americans who go without health insurance. In New Mexico, by some estimates, 200,000 of the state’s more than 400,000 uninsured residents eventually could participate.
Gov. Susana Martinez and state lawmakers had hoped New Mexico could set up and start running a state-operated marketplace for both businesses and individuals by January 2014. But in an acknowledgement Friday that New Mexico had run out of time, the exchange board voted to ask the federal government to take over the responsibility of enrolling individual New Mexicans in need of coverage through 2014. Enrollment would begin in October of this year, with health coverage beginning in January 2014.
The federal help would let New Mexico focus on enrolling workers employed at businesses that don’t provide health coverage, officials said. Enrollment for such workers at businesses would begin in October, with health coverage starting in January.
The federal aid is a temporary fix, however. Washington wants New Mexico to take over the responsibility of enrolling individual New Mexicans next year for coverage that would kick in January 2015, said a federal official attending Friday’s meeting.
It’s unclear whether New Mexico can meet that deadline.
A crucial factor is the length of time it will take New Mexico to get a new, different computer system up and running. The new system will determine who is eligible for Medicaid, the government’s health insurance program for the poor.
According to the U.S. Census Bureau’s American Community Survey, New Mexico had the second-worst poverty rate in the nation in 2011, with 21.5 percent of the state’s population – or 439,914 – living in poverty.
In a display of how complicated the exchange or marketplace will be to run, that new state system, known as Aspen, would have to communicate with a federal information hub to determine a person’s Medicaid eligibility. The federal hub would then communicate with the state marketplace.
New Mexicans who make more than 138 percent of the federal poverty level — around $15,000 for an individual and nearly $32,000 for a family of four — would use the exchange to shop for health coverage.
New Mexicans earning less than that would qualify for Medicaid.
Aspen, however, is not configured to communicate with the federal information hub, officials said. The federal hub, meanwhile, is not up and running yet, either.
Add to the complexity the state’s timeline for making sure Aspen is ready for service.
“I think it’s mid next year before we have all the bugs fixed,” Matt Kennicott, spokesman for the New Mexico Human Services Department, said of Aspen.
GetInsured.Com, the winning bidder Friday, beat out its competition partly because of cost, and partly because of its model for providing a space where people can purchase health care, officials said.
GetInsured.Com likens itself to the Travelocity of health care on its website.
At websites like Orbitz, Kayak or Travelocity—consumers can specify the date and time of their travel, whether they want aisle or window seats, choose their airline and decide if they would be willing to accept a stop-over in their journey. Why couldn’t users purchase their healthcare with the same ease?
Exchange board member Ben Slocum told his colleagues that state would save money by going with GetInsured.com because the company would bear the cost of periodic software upgrades required to run a complex system.
With Deloitte, the state would own the system and bear those costs, he said.
A final scoring grid shows that GetInsured.com outscored Deloitte in each of the five categories state officials used to rate the proposals, earning a total of 905 points out of 1,000, compared to 747 earned by Deloitte.
The categories used in the rating system were proposal solution, experience of dedicated team, demonstration of existing capabilities, performance guarantees, and cost proposal.