Troubled Obamacare vendor awarded new Hawaii contract

by Malia Zimmerman, Watchdog.org, December 23, 2014

HONOLULU — Montreal-based CGI Group Inc., the company that received a $74 million contract to develop and maintain the Hawaii Health Connector web portal, will be awarded another year-long state maintenance contract despite the ongoing problems with the site.

The money comes from a $204 million federal contract the state received in 2012 to set up the Obamacare network in the islands.

The CGI-developed website has experienced a number of technical problems and delays since it launched in October 2013. Because of similar problems, the federal government and other states that had contracts with CGI Corp. cut ties with the vendor.

Hawaii Medical Service Association, the state’s largest health insurer, recently announced it won’t participate in the Connector’s Small Business Health Options Program as of January.

The Connector, already under fire for being the most costly exchange in the nation, is left with just one insurance company for local small business owners to select — Kaiser Permanente.

The decision by HMSA came after it spent 8,000 hours dealing with the exchange’s technical problems, which drained finances and staffing resources, and information on 133 patient accounts vanished as they were transferred from the connector to HMSA.

HMSA will continue to insure another 5,000 people enrolled through the individual subscriber portion of the Connector.

While some have called for the state to follow the lead of the federal government and end its work with CGI, Hawaii Health Connector has renewed a contract with that vendor for at least one more year.

The nation’s largest medical insurer, Optum, also bid on the Hawaii Health Connector contract, but CGI won the $1 million contract, primarily for maintenance and system integration. The company has already received $57 million of the original $74 million grant originally set aside for the portal.

So far, under the Affordable Healthcare Act, Hawaii has signed up just 10,800 people for health care, despite predictions from former Gov. Neil Abercrombie that “hundreds of thousands of people” in Hawaii would enroll.

CGI is the same company that built Hawaii’s troubled tax department collections system. The company was awarded more than $87 million to upgrade the tax department system between 1999 and 2011, but the system had several glitches. Now the state has to redo the system at a cost of millions more to taxpayers.

Senate President Donna Mercado Kim has been the leading local critic of the company, saying after investigating the tax department issues, she warned the Connector not to hire CGI.

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