Minnesota legislative auditor to probe MNsure launch

With Minnesotans still experiencing problems with the MNsure website, the state's legislative auditor said Monday he is planning a full-throttle investigation, starting with the vendors that received tens of millions of dollars to build the state's new health insurance exchange.

Jim Nobles said the first phase will focus on whether the IT contractors delivered on their promises and whether the state kept a close enough eye on their work.

"It's fine to question the performance of the contractor," Nobles said in an interview. "We'll do that. But one of the worst things you can do in managing these contracts is to stand on the sidelines with the hope that things will go well. You've got to be actively managing and verifying."

A team from Nobles' office will kick off the audit Tuesday morning at the state Department of Commerce, which handled the flow of federal funds to the state.

Minnesota received $46 million in federal grants to hire contractors to build the technological backbone for the website. Combined with additional federal grants for staffing and marketing, the state has received $155 million since February 2011 for the MNsure effort.

The exchanges are part of the federal Affordable Care Act, aimed at helping individuals and small business find more affordable insurance policies by creating a larger risk pool and a competitive marketplace. Minnesota is one of 15 states and the District of Columbia that decided to build their own exchanges.

Maximus, a Reston, Va.-based company, was lead vendor and has been described as the "grand conductor" of the operation, hiring all of the subcontractors.

Connecture, based in Brookfield, Wis., designed the shopping platform. EngagePoint of Fort Lauderdale, Fla., handles the billing and financial management functions and also acts as an integrator, making sure various software programs and components of the system work together.

Gov. Mark Dayton sent a scathing letter to IBM's chief executive in mid-December outlining a list of troubles. IBM responded by sending as many as 100 workers to St. Paul to get the site ready for a Dec. 31 deadline.

But the site was out of commission as recently as Thursday, and it was taken down for scheduled maintenance over the weekend.

MNsure is tied to the federal hub to verify citizenship and household income. When the federal site is down MNsure must go offline as well.

Officials with MNsure, the Department of Commerce and various vendors did not respond to requests to comment on the legislative auditor's investigation.

MNsure's continued woes are sure to be front and center during a meeting Thursday of the bipartisan Legislative Oversight committee.

Nobles is serving his sixth six-year term as legislative auditor, leading the watchdog agency of state government. He is appointed by lawmakers of both parties.

He said he has long planned to track how the state used federal funds to create MNsure, as part of his regular duties. But he said he will "use the opportunity" to go beyond what state and federal lawmakers would require and dive more deeply into MNsure, a new state agency that is run by a board of directors appointed by the governor.

Nobles said the first phase of his audit could take as long as four months. In March or April he plans to bring in a team of IT experts to examine MNsure's security features. Eventually he will launch a comprehensive examination of MNsure's overall governance structure, including the board of directors' oversight.

"The goal is to create a timeline that's going to tell the full, complete story of what state officials knew was occurring, when they knew it and what they did to resolve those issues," Nobles said.