IT and Implementation Committee Strategic IT Decisions November 28, 2011

Colorado Health Benefits Exchange

IT and Implementation Committee Strategic IT Decisions

November 28, 2011

Overview

• Comments/Feedback from Board Meeting

• Review Gameplan Leading to Initiation of Formal Acquisition Process

• Discussion of Items in Eric’s 11/28 email

• Steps Leading up to 12/12 Board Meeting and Key Decisions

• Asset Acquisition vs. SAAS Model• Alternatives• Criteria• RFI Process

• Proposed Acquisition Process• RFP vs. RFQQ vs. RFI• Major Activities and Timeline• Evaluation Criteria• Evaluation Committee

• “Optimal” Level of Interoperability between COHBE System and Business Processes and State Eligibility Systems and Business Processes

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1. Should the Exchange use a SAAS model or acquire (borrow/build/buy) the capital IT Exchange assets?

2. What is the “optimal” level of “interoperability” and coordination with the State’s Medicaid/CHIP systems, business processes and existing customer support services?

3. With respect to #2, does the State intend to upgrade or replace CBMS so that near-term investments to modify CBMS and PEAK to meet the requirements of healthcare reform are rationalized against the State’s strategic direction?

Three Strategic IT Questions that Need to be Answered over Next 30 – 60 days

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Review gameplan and interim decisions leading up to 12/12 Board meeting

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Date Topic of Meeting Objective/Decisions/Issues Impact on Next Steps11/28 Board Meeting

Present decision, decision framework, approach and timeline to Board.

Can procurement of Exchange system(s) and services proceed prior to award of the Level 1 grant?

Sequential process of issuing RFP/RFQQ after 02/15/12 will likely reduce implementation time by approximately 1 month.

Week of 11/28 Present procurement process (what/why/when), timeline, options and highlights from vendor in-depth demos and RFI process.

Concur with procurement process, options and timeline.

Plan out remaining activities leading up to issuance of RFP/RQQ.

Week of 12/05 Present preliminary results of analysis of SAAS vs. asset acquisition.

Informational. Ensure that Committee understands trade-offs.

12/12Board Meeting

Present results of analysis of SAAS vs. asset acquisition to Board and associated procurement strategies.

Key asset acquisition decisions. Strategy and detailed timeline for systems and services acquisition needed to proceed.

Week of 12/12 Present outline of RFP/RFQQ, key requirements, etc., i.e. procurement and evaluation guide.

Concur with direction of procurement. Will Board members serve on acquisition evaluation team(s)?

Draft acquisition documents.

Week of 12/19 TBD or catch-up or schedule adjustment.

Week of 01/02 Review draft acquisition documents. Will likely need turn-around in one week and approval to present to full Board. Can draft documents be provided to federal sponsors for review?

Incorporate comments and provide final draft to full Board.

01/09Board Meeting

Provide final draft of acquisition documents to full Board.

Will likely need turn-around in one week. Incorporate comments and finalize.

01/23Board Meeting

Motion to release RFP(s)/RFQQ(s). Approval of Board to release RFP(s)/RFQQ(s).

Week of 01/23 Release RFP(s)/RFQQ(s).

Discussion of Eric’s 11/28 Email

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As a follow up to our first committee call, I wanted to see if staff has or is considering reusing and collaborating with other nearby and Level I grant recipients. I had the opportunity to spend some time with Dwight Fine, who is currently leading Missouri’s Health Insurance Exchange efforts as well as their Chairperson, Jeff Bond, CEO Cox Health Plans. Cox is a client of mine and Jeff asked if I would spend some time to discuss our mutual State’s progress. I made it clear I was not representing the COHBE or the board but more so to discuss progress and areas of concern. Some key observations: 1. They are using KPMG to assist in the technology requirements and initial RFI – are we considering an RFI or straight to RFP? Sometimes RFIs are helpful to help develop your RFP requirements. As you can see from the attached 175 page document, Missouri has already done an exhaustive evaluation of customer service, functional, and system integrators. I would be interested to see how our vendor list aligns to MO.

Executive Director’s call. Current plan is to hire IV&V vendor for periodic oversight after receiving Level 1. GMS has extensive knowledge of ACA subject matter and related IT from interacting with multiple states, CCIIO and CMS over the past 12 months.

Is there is time to retain KPMG or other consulting firm prior to receiving Level 1 funding and maintain schedule? (see Proposed Acquisition Process slide #9.).

In RFI process now. Solution demonstrations and RFI for each vendor performing demos, then RFP.

RFPs and requirements available from other states and accessible via the CCIIO CALT.

2. We discussed the concept of collaboration – Dwight said he is on HHS Level I grant calls and they are less geared toward state collaboration more so interpretation of HHS proposed regulations. Areas of collaboration – commercial insurance front-end design, hosting management, enrollment interfaces, etc. We also agreed that collaboration would be limited in scope given state by state Medicaid and benefit design variations.

Agree.

Discussion of Eric’s 11/28 Email

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3. Jeff mentioned that they are behind Colorado on HBE law so as Chairman, he is positioning a back-up plan to leverage their Level I grant to invest in their exchange Medicaid capabilities – an investment they need to make regardless of the outcome of state exchange law. I have attached technical requirements and architecture materials Dwight sent me (all available on their website) and he indicated we are free to reuse all or part of the attached materials. It also includes a detailed status update they provide to HHS as a component of their Level I grant.

Great. Will review and glean what is applicable from MO as well as from other sources, i.e. CALT. As we discussed, there is a race for vendor mindshare, it would seem that collaborating on RFPs and even perhaps architecture is worth further evaluation. The other consideration would be using a firm like KPMG that has the benefit of working for many states and can provide existing best practice on our behalf. Either option would seem to reduce cost and increase speed to market. Not sure how to collaborate on RFPs other than using applicable work products. Acquisition timeline is extremely tight.

May have an opportunity to collaborate on MAGI eligibility process, but prefer that this capability is acquired in the COHBE system (which is likely to be common between COHBE and HCPF; see slides #12 - #16)

Link to RFI announcement on MHIP website:http://www.mhip.org/bidding-opportunities.html

https://mail.coloradohealthinstitute.org/owa/redir.aspx?C=e335c525d2614e64a6e2804c02c06b74&URL=http://www.mhip.org/bidding-opportunities.html

Acquisition Process

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• Three major solution components must be procured: 1. Exchange technology solution (acquire/license or rent)2. Exchange technology solution hosting (outsource)3. Exchange administrative and customer support services (outsource)

• Asset acquisition (with federal funds) likely to result in lower sustainability costs vs. SAAS model which has lower upfront costs but higher operational costs; however, starting to see significant decrease in SAAS solution providers price points

• Recommend bundling (single procurement) for #1, #2 and #3

• This will require some vendors to “team”; but recommend a single “prime” contractor

• Procurements will be:• Well-structured• Efficient• Competitive• Fair • Transparent

Acquisition Process

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• As mentioned COHBE is currently in RFI process (see attached RFI)

• RFP vs. RFQQ?

RFP An RFP is a solicitation sent to potential suppliers with whom a creative relationship or partnership is being considered. Typically, the RFP leaves all or part of the precise structure and format of the response to the discretion of the suppliers. Indeed, the creativity and innovation that suppliers choose to build into their proposals may be used to distinguish one from another.

RFPs typically reflect the strategy and short/long-term business objectives, providing detailed insight upon which suppliers will be able to offer a perspective. If there are specific problems to be addressed in the RFP response, those are described along with whatever root cause assessment is available.

RFQQs are best suited to products and services that are as standardized and as commoditized as possible to make the suppliers’ quotes comparable. An RFQ is a solicitation sent to potential suppliers containing in exacting detail a list or description of all relevant parameters of the intended purchase.

• RFQQ may result in faster acquisition process than RFP but does not necessarily draw on the creativity of the vendor community.

• Recommend RFP

Proposed Acquisition Process

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Question #1: Should the Exchange use a SAAS model or acquire (borrow/build/buy) the IT Exchange asset(s)?

• Exchange Alternatives• SAAS Model• COBHE Acquires Asset; Operated by 3rd Party

• Criteria• Cost

• Implementation• 5-Year operations

• Risks• Schedule risk• Cost risk – assumptions of market segments and size

• Consumer experience• Reliability/simplicity in getting consumers enrolled• Reliability/backend complexity of having all solution components fully functioning• Privacy and security• Impact on COHBE operations/and alignment with ops plan• Interoperability• Strategic direction and latitude• Stakeholder acceptability

• Gathering information to develop solution alternatives (systems and services) and procurement strategy

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• Weekly meetings with HCPF to define the decision framework, i.e. business/architectural alternatives and decision criteria (e.g. impact on customers, schedule risk, reliability/scalability/ maintainability, stakeholder acceptability)

• Use cases important in understanding impact

• Defined 8-10 household composition groups (e.g. SHOP employees, “mixed” households)

• Sizes of these groups are being quantified to factor into discussions re impacts on customer segments from new business processes and systems

Question #2: What is the “optimal” level of “interoperability” and coordination with the State’s Medicaid/CHIP systems, business processes and existing customer support services?

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What is the “optimal” level of “interoperability” and coordination with the State’s Medicaid/CHIP systems, business processes and existing customer support services?

CBMS/PEAK &Medicaid/CHIP Eligibility & EnrollmentBusinessProcesses

COHBEEligibility & EnrollmentSystemsand BusinessProcesses

InteroperabilityBetween COHBE& State Medicaid/CHIP Systemsand Business Processes

Extent of implementation dependencies, i.e. “interoperability” between COHBE system and business processes and CBMS and PEAK and associated State eligibility business processes increase complexity and schedule risk


Degree of Interoperability

Interoperability Functions and Business Processes (Additive)

Minimum

Maximum

Moderate

MAGI EligibilityAccount Mgmt

Master Person Index

Interface w/State MMIS &

CBMS

Shared RulesEngine

Shared Plans

Shared CallCenter

Small Business Owners& Employees

IndividualHouseholds &Small BusinessEmployees

IndividualHouseholds(seeking public assistance,i.e. Medical, Food

or Cash Assistance)

Pre-screening

SHOPExchange

PEAK

IndividualExchange

Account Mgmt & MPI

EligibilityDetermination

Plan Selection &Enrollment

MAGI(including interfacing w/ federal data hub)

Set-up Employee Roster

Create Account

MMISCBMS

Should Pre-Screening Step be

Included?

Enrollment inCarrier Systems

Create Account

Review Subsidy/Out-of-Pocket Costs

Select Plan & Enter Enrollment Information

Interface Enrollment

Information to Carriers’ Systems

Inform CBMS that One or more members of household are

eligible for Medicaid/CHIP

Review Out-of-Pocket Costs


Eligible for Employer Plan &

Amount of Coverage


Information to MCO Systems

Minimal Interoperability – MAGI Only


Small Business Owners& Employees(% and # expected)

IndividualHouseholds &Small BusinessEmployees(% and # expected)

IndividualHouseholds(seeking public assistance,i.e. Medical, Food or Cash Assistance)

(% and # expected)

Pre-screening

SHOPExchange

PEAK

IndividualExchange

Account Mgmt & MPI





Create Account

MMISCBMS


Included?


Create Account





Enroll Eligible HouseholdMembers into Family Medical

Program Into MMIS

Who pays for this interface?




Amount of Coverage



Moderate Interoperability – MAGI & MMIS Interface

Does CBMS Need Enrollment Data?


Gather business requirements

Gather technicalrequirements

Define interoperability “musts”” for 2013

including ACA

Prioritize all interoperability

requirements, i.e. musts, strong wants, nice wants (and who)

Develop 3 options with increasing levels of

interoperability, complexity, risk, costs, etc.

Define design alternatives (functions and feature sets

for each option)

Evaluate feasibility of design alternatives• Decision criteria• Design principles, guiding principles and

best practices• Test against use cases for impact on

consumer and other criteria

Compare feasible alternatives;

define pros/cons andmake recommendation

Draft/Negotiate Deloitte SOW

Requirements Musts Strong Wants Nice Wantsa X

b X

c X

d X

e X

f X

g X

h X

i X

j X

k X

l X

Prioritization of RequirementsRequirements Option 1 Option 2 Option 3

a X X X

c X X X

j X X X

b X X

e X X

g X X

k X X

d X X

f X

h X

i X

l X

Tiered Sets of Requirements

“Musts”

Strong “Wants”

Nice “Wants”

Draft & Submit IAPD

Small Business Owners& Employees(% and # expected)

IndividualHouseholds &Small BusinessEmployees(% and # expected)

IndividualHouseholds(seeking public assistance,i.e. Medical, Food or Cash Assistance)

(% and # expected)

Pre-screening

SHOPExchange

PEAK

IndividualExchange

Account Mgmt & MPI





Create Account

MMISCBMS


Included?


Create Account





Enroll Eligible HouseholdMembers into Family Medical

Program Into MMIS

Who pays for this interface?




Amount of Coverage



Moderate Interoperability – MAGI & MMIS Interface

Does CBMS Need Enrollment Data?

Define scope for Exchange System(s) and Services

(RFP/RFQQ)

Define scope for modifications to PEAK &

CBMS

Begin Formal Exchange Acquisition

Process

Approach to Determining Optimal Interoperability Strategy


Interoperability Decision CriteriaConsumer Experience

- Make enrolling in coverage for the individual/household as fast and as simple as possible- Balance administrative simplicity, efficiency and effectiveness- Enable continuity of care- Provide user-friendly access to all eligible CO citizens and small CO businesses that desire access- Leverage and integrate with State systems and business processes as appropriateReliability/Simplicity in Getting Consumer Enrolled- Make enrolling in coverage for the individual/household as fast and as simple as possible- Leverage and integrate with the State system(s) and business processesReliability/Backend Complexity of Having All Solution Components Fully Functioning- Leverage and integrate with the other systems w/o reducing reliabilityPrivacy and Security- Leverage and integrate security, i.e. account management and MPI- Minimize proliferation and transmission of PIICost- Minimize costs to the COHBE, consumers, employers and carriers

Risk to COHBE Project Deadlines- Minimize Risks of: 1) not meeting federal milestones, 2) delivering baseline scope and 3) completing the project within the baseline budgetStrategic Direction and Latitude- Maximize flexibility to change its direction; enable the state to go in a different direction in the future without COHBE or State incurring a large potential cost impact or disruption to end users; this could include a different Exchange solution provider (re-compete) or a different Exchange solution direction such as building or buying the HIX software and integrating with State system in futureStakeholder Acceptability- Recognize limitations of interoperability given political realities, funding constraints, etc.

Background Material

Role of IT and Implementation Committee

• Role is to provide guidance to COHBE executive leadership and early input into major strategic decisions such as IT investments, acquisition of services and procurement strategy

• These initial acquisition decision(s) will likely be in the order of tens of millions of dollars over the first 3 – 5 years

• Procurements will be structured to be competitive, fair and transparent

• Due to the political sensitivities and visibility surrounding the COHBE, it is important that there be no real or apparent conflicts of interest in procurements activities and operational decisions

• Meet weekly leading up to the start of the formal acquisition process

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COHBE Implementation and Start-up Timeline

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Note: Accompanying timeline for required enhancements to PEAK & CBMS not shown

Analysis/Confirmation of Current Approach & Prel

RFP

High-Level Timeline – COHBE Policy & Business Decisions and IT

Procure IT Systems & Services for HIX

COHBE Certificationby HHS

11/11 01/12 03/12 05/12 07/12 09/12 11/12 01/13 03/13 05/13 07/13

2011 2012

HIXIntegration Testing

Design/Build/Test HIX Systems (Eligibility/Enrollment/Plan Mgmt and Associated Services Interface w/ Federal Data Hub, Other Data Sources, MMIS, PEAK/CBMS)

2013

Policy & BusinessDecisions and Activities

HIX - IndividualPilot Phase06/13 – 10/13

HIX Deployment

Policy & Business Decisions

Impacting IT

Supreme CourtRuling on Mandate

Evolving Policy and Business Decisions based on CCIIO/CMS/Board/Executive Director/Legislative Oversight/etc.

Start-up and Operational Decisions

Start-up Activities

Operational Activities

Analysis/Confirmation of Current Approach & Prel

RFP

IT/Systems

Procure IT Systems & Services for HIX

HIX SHOPIntegration Testing

Design/Build/Test HIX Systems for SHOP

HIX - SHOPPilot Phase04/13 – 10/13

HIX Deployment

Establish PMO

Draft COHBE Guiding Principles for Systems and Implementation

Category Guiding Principle

Exchange Functions, Features and Business Processes

Meet the minimal requirements of federal regulations; enhanced functions, features and integration will be considered in the future. New business processes to execute Exchange business processes shall minimize the impact to other State agencies’ business processes or systems.

Exchange Customers and Business Lines

Customers of the Exchange are individuals and small business owners and their employees.There will be a single Exchange. The Exchange will have two business lines: 1) the SHOP Exchange and 2) the Individual Exchange

Market Competition Encourage competition in the market whether it is inside or outside the Exchange.

Continuity of Care Ensuring continuity of care is a personal responsibility; the Exchange will not pro-actively enroll or change enrollments of consumers (i.e. individuals and small employers and their employees).

Integration with Medicaid

Minimize integration with Medicaid eligibility in the near-term; consider tight integration (and possible upgrade of State’s eligibility system) in long-term (i.e. 3-5 years); make investments based on this strategy. Send consumers to the “right” door first but enable cross (MAGI) eligibility determination.

Federal Deadlines Work with State Medicaid agency but do not jeopardize meeting federal and state deadlines.

Solution Acquisition Leverage existing solutions and solution components from other states and federal partners to the maximum extent possible.

Inter-agency Partnerships

Work in concert with all State agencies, e.g. HCPF, DHS, OIT and Insurance Department.

Regulatory Authority Maintain the Colorado Insurance Department as the single regulator.

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Documents

IT and Implementation Committee Strategic IT Decisions November 28, 2011