A lack of key components in the MNsure IT system led to data problems that delayed thousands of tax forms earlier this year for people who bought coverage through the exchange, a new report said.
The data problems had to be solved before MNsure could distribute all 43,000 tax forms, which filers needed for reporting information about tax credits to the IRS.
Problems were compounded by a lack of contingency planning as well as poor communication between different branches of state government, according to the report released this week from the consulting firm Accenture.
It found that only 8,500 forms — about 20 percent of the total — were distributed by the IRS deadline of Jan. 31.
“Data integrity was identified as the root cause of the delay in generating 2015 [tax] forms,” the consultant wrote. “Data quality issues were compounded by, and highly interconnected with, underlying issues related to program delivery and interagency coordination.”
MNsure and the state’s MN.IT department for information technology are splitting the cost of the $60,000 report. State officials say they are making progress on developing the missing IT components and preventing future problems with the tax forms.
“In terms of the strategic options that they laid out for us, much of the work is already underway,” said Scott Peterson of MN.IT.
Allison O’Toole, the MNsure chief executive, said the report didn’t identify new problems with the process, but put a finer point on what went wrong. MNsure and MN.IT were trying to use a new automated process to generate the forms for 2015, but ultimately reverted in mid-March to their old system for the final batch of about 13,000 forms.
“I wish we could have done that in January, and we just — we didn’t,” O’Toole said. “I think it was because of communication problems, issues weren’t escalated appropriately. And this evaluation has helped us identify those things.”
Minnesota launched the MNsure exchange to implement the federal Affordable Care Act, which requires almost all Americans to have health insurance or pay a penalty.
Minnesotans at certain income levels can receive federal tax credits to discount premium costs, so long as they buy through MNsure. The tax form 1095-A documents that people had insurance and lets them reconcile the subsidies they used, with the tax credits they actually should have received.
When MNsure distributed forms for 2014, the exchange relied on information about enrollees supplied by health insurers, with the understanding that carriers would not have to provide the data in the future, according to the report.
For 2015, the state launched a new system that was meant to provide a fully automated process for generating the tax forms. But getting the process to work depended on a complicated plan to improve data communication between MNsure and insurers, as well as a one-time “true up” for enrollment information.
“These projects would need to be executed in coordination with 55+ other exchange projects being worked on during the same time period,” the report stated.
The plan faced several delays as the state and insurers tried to agree on data exchange processes, procedures and formats. The first attempted true-up in early October 2015 revealed “major data issues,” the report found, and the problems were tough to resolve.
By mid-January, the state decided to focus its work on generating the least complicated forms, meaning forms for people whose eligibility for coverage and subsidies didn’t change during the year. But 60 percent of the forms were classified as “complex scenarios,” the report found.
The state was late to develop contingency plans, the report found, noting there was no planning for a worst-case scenario until late December 2015.
“Complex carrier relationships and overconfidence that the new process would work resulted in delayed coordination,” the report stated.
When enrollees pick a health plan on the MNsure website, the information is sent to insurers who collect premium payments. Insurers then send data back to MNsure that lets the exchange know how many people actually are paying for their coverage.
MNsure and the plans also must share information about “changes in circumstance,” such as when household income or family composition changes in ways that affect eligibility for tax credits.
Going forward, the report calls for the state and insurers to reconcile data on a weekly basis. The state should prioritize IT fixes so the system can “automatically ingest” enrollment files from carriers, the report concluded, and automatically process changes in circumstance.