Cover Oregon Might Still Resurrect State-Run SHOP Exchange for Small Employers

Even as new Cover Oregon director Aaron Patnode unequivocally ruled out putting the state back in charge of the enrollment website for the individual market, he said the state could still opt for a partnership exchange like Illinois, where Oregon would be responsible for the small group portal.

Even as Cover Oregon appears to have closed the door on bringing back the full state-run health exchange website for the individual insurance market, director Aaron Patnode indicated Friday that the Cover Oregon board is still considering an online exchange portal for the small business market.

One option would be to form a “partnership exchange,” like they have in Illinois. The Land of Lincoln lets the federal government take care of the individual market but runs its own small business portal, or SHOP exchange.

This gives Illinois considerably more involvement than the “supported state-based marketplace” that Cover Oregon has thus far has chosen to transition to, after its board voted to pull the plug on the nonworking portal developed by Oracle in April.

No decision has been made on the future of the SHOP exchange, and in 2015 small business owners who wish to extend health insurance benefits to their employees, and receive federal tax help, will have to enroll them directly with an insurance company -- just as they had to in 2014.

President Obama kicked the can down the road for the federal SHOP exchange as well. The federal SHOP should be operating early next year for businesses in other states using the federal exchange.

Patnode’s mention of following Illinois’ lead and running a SHOP exchange dangles a new possibility that would keep Cover Oregon very much in the game. The cost of running or developing a working SHOP exchange might prove to be an obstacle, however.

The director once again ruled out an individual market portal run by Cover Oregon: “It’s an extremely long shot that we could have that running in 2017 or 2018 or 2019,” Patnode said. “That’s undertaking an enormous amount of development. We don’t have the capital.”

Cover Oregon’s finances are already suspect and in the future, the public corporation that remains will have to live within a fraction of its original budget. The exchange burned through $9.4 million just in June and was left with just $28 million to get through the end of the year.

The exchange is still waiting to bill the insurance companies for about $7 million that Cover Oregon is owed on commission, but that number is much lower than original projections, since the exchange sold fewer than half the predicted number of policies. As of Aug. 6, Cover Oregon had enrolled nearly 97,000 people in private health plans -- far short of the 237,000 people the state had projected based on questionable assumptions.

Marketing director Amy Fauver reiterated that any decision regarding the future of the SHOP exchange beyond 2015 is preliminary and something that would have to be determined in discussions with the Cover Oregon board.

In one sign of hope that state functionary Tina Edlund’s command of the transition and salvaging of the Oracle technology for use with the Oregon Health Plan is going better than under previous captains, the latest Maximus quality assurance report released at the end of July had only green and yellow flags -- none of the red flags that dominated the report in 2012 and 2013 as Cover Oregon headed for unanticipated peril.

Chris can be reached at [email protected].

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I just don't understand the need to continue supporting the bloated, ineffective and duplicative infrastructure of Cover Oregon. Where is the value in this? We honor the right to die in Oregon. Please let Cover Oregon use it.