State signs last major IT contracts for health benefits exchange

This week, the state of Vermont signed the last two major information technology contracts needed to implement the state’s new health insurance marketplace, or exchange, come Oct. 1.

The combined price tag for outside help to get Vermont Health Connect up and running is $15.2 million, most of which is covered by federal funding.

“We are outsourcing the design, development and implementation elements for the exchange,” said Mark Larson, commissioner of the Department of Vermont Health Access. “Having all of our players in place and doing actual work is a major milestone.”

The state signed a 12-month extension with Maximus Inc. worth $12,578,162. Maximus, which has an office in Burlington, runs the state’s call center for Medicaid programs, and it will play an increased role at the outset of the exchange.

This extension to a December 2011 contract lengthens Maximus’ contracting services to the state until June 30, 2014. The entire contract is worth $17,540,153.

The extension comprises the bulk of the contract, Larson said, because the number of people the call center will serve is expected to increase dramatically. The state estimates that 118,000 individual customers and employees at businesses with fewer than 50 workers will join the exchange. When the new marketplace first opens, Larson expects calls to last longer, and he said the department expects a higher level of customer service from the company — namely, lower wait times and fewer dropped calls.

Larson said the state chose to end the contract with Maximus in mid 2014 because his department doesn’t want to switch vendors right before or during a major influx of people onto the exchange. When that contract expires, he said, the state would put out a request for proposals via a competitive bidding process.

The other major contract that the state signed this week was with Benaissance, based out of Omaha, Neb. Benaissance will oversee premium billing on the exchange for a price of $2,622,634, from May 1, 2013, until the end of 2016.

Benaissance will work under the Canadian-based firm CGI until 2014. CGI is building and implementing Vermont’s underlying IT infrastructure for the exchange at a price of $36 million over two years.

Andrew Stein

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