Sharfstein tells Congress contractors are to blame

Maryland's top health official told a congressional panel in Washington on Thursday that IT contractors were to blame for the state's troubled rollout of the Affordable Care Act and suggested that the state may reimburse the federal government if it can claw back money from those companies.

Though Maryland Health Secretary Joshua M. Sharfstein has repeatedly testified in Annapolis about the launch of the glitch-prone website, the hearing by a subcommittee of the House Oversight and Government Reform Committee was the first time he has publicly addressed questions from federal lawmakers about the exchange.

In an occasionally testy hearing, Republican lawmakers peppered Sharfstein and health officials from other states about when they discovered problems that caused sites to crash on Oct. 1. And they questioned whether Maryland would pay back any of the $180 million in federal grants it has received so far.

"The question is really simple," said Rep. Jim Jordan, an Ohio Republican. "Is Maryland going to return some of the money?"

"We're going to follow all of the applicable laws in terms of the funding," Sharfstein said, later adding, "I think the federal taxpayers should get back some of the money when we get it back from the contractors."

Sharfstein faced two separate panels Tuesday questioning him on the state's troubled exchange, getting a grilling later by a General Assembly committee. State lawmakers quizzed him on whether the state could actually recoup cash from the contractors, and whether the newest plan to revamp the broken exchange would work given the stumbles in leadership at the outset.

"It seems like there's a lot of blame to go around," said Del. Susan Krebs, a Republican from Carroll County. "Are we going down the same path again?"

The hearings came days after the board overseeing Maryland's exchange voted unanimously to scrap its website and adopt software developed by Deloitte Consulting and used by the more successful health exchange in Connecticut.

Maryland officials, including Gov. Martin O'Malley, have long blamed IT contractors for botching the rollout.

On Thursday, state auditors — who reviewed more than 14,551 pages of emails, procurement documents and previously released reports from a consultant hired by the exchange — cited serious issues related to management and planning, many that went unaddressed.

"Generally, we were unable to determine who the key decision makers were, and what decisions were attributable to them," auditor Thomas J. Barnickel III wrote to in a letter to lawmakers.

The auditors said there were other problems related to software development, testing and security.

Sharfstein cautioned lawmakers not to read too much into the auditors' conclusions, pointing out that they only reviewed documents released to the public — many of which were heavily redacted.

"Just because they're saying they didn't see it, doesn't mean that it doesn't exist," Sharfstein said.

The back-and-forth in Washington and Annapolis came as new details also emerged about a federal audit of the state's effort. A letter this week from the inspector general of the Department of Health and Human Services obtained by The Baltimore Sun provides additional information about the scope of that review, including that federal auditors will assess whether the state "used funds as intended."

The state's website crashed immediately after launching Oct. 1 and has been riddled with technical problems ever since. The exchange's executive director resigned under pressure, and officials later cut ties with the website's main contractor, Noridian Healthcare Solutions, because of the problems.

O'Malley has also blamed software Noridian used that had been developed by IBM, threatening to take the company to court. IBM has argued that it went beyond its contractual obligations to help Maryland meet enrollment goals and that state officials didn't properly manage the exchange.

Noridian officials have said they complied with its obligations even under pressure and facing constant changes requested by the state. Sharfstein told state lawmakers they negotiated with Noridian a "six-month standstill" before it begins any litigation.

"I cannot fully express how frustrated I was with the troubled rollout of the Maryland Health Connection," said Rep. Elijah E. Cummings, a Baltimore lawmaker and the top-ranking Democrat on the committee. "We needed the system to work. And when it did not, unnecessary obstacles were put in their way."

Maryland has spent $129 million in mostly federal funds on the exchange, Sharfstein said in Washington, and now plans to ask the federal government for more money and its blessing to develop the new website. The state has won $180 million in federal grants, though it has actually spent only about $100 million of that money, he said.

Annapolis lawmakers in recent days have sharpened their questions about exactly who got paid for building the exchange, and how much more it would cost to fix it.

"It's been really hard to follow the money," said Del. Heather Mizeur, a Montgomery County Democrat.

In one particularly aggressive exchange in Washington, Jordan, the Ohio lawmaker, questioned Maryland's revised goal of enrolling 70,000 people in private insurance. Initially the state had expected to sign up 150,000, but a nonpartisan heath research organization at the University of Maryland, Baltimore County said in February that a mistake in a chart inflated that projection.

Sharfstein said Thursday the state had enrolled just over 63,000 people in private insurance.

"You're not coming close to [the original goal] and, shazam, you get a revision," Jordan said. "You get someone to give you a revised number."

Sharfstein said that the independent research group came to the state with the revised number, not that the state had solicited it.

Baltimore Sun reporter Meredith Cohn contributed to this article.

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