PROVIDENCE – Anya Rader Wallack, the former director of HealthSourceRI, is now the new state director of Medicaid, beginning today, Monday, Nov. 2.

“I’m going to get a box of hot potatoes, that’s the nature of the job,” Wallack told ConvergenceRI in an interview the day after her new position was announced, talking in a forthright manner about the host of new challenges now awaiting her.

Brought in by Gov. Gina Raimondo to replace Christine Ferguson at HealthSourceRI, the message that Wallack preached from the beginning of that job was about achieving sustainability.

“Clearly, sustainability is one of our biggest challenges,” Wallack told ConvergenceRI in an interview in early January of this year, explaining the charge given to her: “How do we make sure that this [agency], when the federal funds go away, that it can continue to exist and provide value for Rhode Island.”

Wallack continued, in that interview: “We need to get to the point where the exchange is a really well-oiled machine, providing excellent customer service. Providing value, retaining customers, attracting new customers.” [See link to ConvergenceRI story below.]

Raimondo, in turn, in explaining the reasons for her decision to remove Ferguson, had also focused on the agency’s sustainability: “We need a leader who can establish HealthSourceRI as a sustainable and affordable organization that provides clear return-on-investment [emphasis added] to Rhode Island families and employers.”



At that time, ConvergenceRI wrote: “The critical question, unasked and unanswered, remains: what is the economic equation by which you determine and define return-on-investment?”

Today, as Wallack leaves HealthSourceRI to take on her new job, responsible for implementing the new “Reinventing Medicaid” plan, what is meant exactly by return on investment – and how you measure it – is still largely unresolved. 

Much of the initial successes achieved by HealthSourceRI – the larger number of people who enrolled, the drop in the number of uninsured to 5 percent, lower than the number of state’s unemployment rate – can be attributed to Ferguson, not Wallack.

A year ago, in November of 2014, with the first annual renewal drive, Ferguson chose to have everyone go through the process of renewal and choosing a health plan, rather than opting for automatic renewal.

The results: some 31,513 had enrolled as of Feb. 23, 2015, a week after the end of the open renewal period, with some 30,001 having paid their first monthly premium – an increase over the 26,000 first-year customers.

As of September of 2015, HealthSourceRI had enrolled more than 37,000 Rhode Islanders in health plans [both renewals and first-time customers], with some 30,000 receiving federal tax credits to make the private health insurance affordable, according to the agency. In addition, some 82,000 Rhode Islanders have been enrolled in Medicaid since 2012 under expanded eligibility rules. The number of uninsured residents had been reduced from about 113,000 to fewer than 50,000.

On Nov.1, HealthSourceRI officially launched its second annual open enrollment drive. This year, the renewal drive will be done mostly online, with as a process of automatic renewals for customers who don’t engage in the process.

That decision has been driven in large part by the reduced budget approved by the R.I. General Assembly.

At a Rhode Island Business Group on Health breakfast gathering in March of 2015, Rep. Joseph McNamara, the chair of the R.I. House Health, Education and Welfare, offered his analysis of the legislative intent. McNamara quoted R.I. House Speaker Nicholas Mattiello as saying, that when you looked at the money being put into HealthSourceRI, it’s like we’re building a Maserati.

“I told him: we’re building a Maserati, but what we really need is an F-10 pickup truck that will carry the load of a smaller population,” McNamara said, explaining the legislative rationale behind paring down the budget.

The agency’s headquarters have been shifted to a nondescript small cottage on the John Pastore campus in Cranston, and the budget has been downsized, resulting in the closing of the in-person customer service center.

But, major cracks and deep fissures have emerged in the agency’s customer service capability. That “F-10 pickup truck” budget bargain, to make use of McNamara’s metaphor, appears to need some extensive, expensive engine repairs.

As first reported by ConvergenceRI in last week’s edition, it has now become difficult if nearly impossible to reach HealthSourceRI by phone, resulting in customers traveling to the former customer service center on Royal Little Drive, only to be turned away.

The customer service center on Royal Little Drive has been cut back to providing bill-paying services only, thanks in large part to budget cuts by the R.I. General Assembly.

Customers, in turn, according to a few who showed up recently at the center, have been frustrated by the long wait times on the phone, complaining that they were unable to get through, prompting a trip to the center. The rep at the bill-paying station politely informed them to keep trying.

One customer shook his head in frustration, saying he had been trying to get through for more than an hour, without success. [See link to ConvergenceRI story below.]

[The Providence Journal followed up later that week with its own front-page story, detailing the complaints of customers who were frustrated that they could not determine if they had health coverage – and spent hours on the phone trying to get through, without success.]

Wallack, in her most recent interview with ConvergenceRI, called the reporting a “legitimate treatment of a real problem we’re dealing with every day.” We have customers that are extremely frustrated, she continued. “We’re taking a number of steps to try and mitigate the problem.”

One of the few remaining places where consumers can find in-person help is at many of the state’s community health centers, including at Blackstone Valley Community Health Care, where there are currently four “outreach and education” navigators.

But, it is often a very frustrating job, because of the lack of support at HealthSourceRI, a source explained to ConvergenceRI – because the help desk at HealthSourceRI is “practically non-existent” and the technology “is far from perfected.”

Wallack’s vision of achieving sustainability – “to get to the point where the exchange is really a well-oiled machine, providing excellent customer service” – appears to be at risk. 

Does the glitch remain the same?
The apparent glitch encountered by many current customers has been an allegedly recurring problem under the new IT interface known as UHIP, the state’s Unified Health Infrastructure Project.

The massive initiative to rewire the state’s entire health and human services infrastructure is now projected to cost more than $364 million to complete, with Deloitte as the principal contractor, funded mostly by the federal government. 



As reported by ConvergenceRI some 10 months ago, in January of this year, there had been a documented record of the cost caused by the failures and breakdowns related to UHIP. A 365-page briefing book prepared by Ferguson for her successor detailed how, as a result of the glitches, HealthSourceRI had to spend about $10 million and divert staff to address the snafus.

“During the first open enrollment period and throughout the remainder of 2014, the UHIP system experienced many issues that have had a deeply negative impact on the consumer experience,” according to the briefing book.

“Inadvertent dis-enrollments are causing many Rhode Islanders who think they have health coverage and who are up-to-date in paying their premiums to find out that they aren’t covered when they go to the doctor’s office, hospital, or pharmacy,” the report said.

Beginning in March of 2014, the report continued, “We began to divert resources at the HealthSourceRI and the Contact Center to mask these defects and to address the needs of those consumers, carriers, brokers and small businesses facing significant problems.”



“We have been operating under a contingency plan for the past 10 months,” the report said. At that time, some 14 staff members at HealthSource RI had been redirected to address UHIP defects, issues and workarounds. In total, the extra costs that were absorbed by HealthSourceRI as a result of UHIP’s glitches and snafus were calculated to be $9.7 million during the last year, according to the briefing book.

Translated, HealthSourceRI had to spend about $10 million during 2014 to fix the glitches caused by UHIP – roughly about 80 percent of its current budget.

It’s unclear if the technology glitch has ever been completely fixed; Deloitte, however, did provide pro bono services toward the efforts of the re-invent Medicaid working group.

The road ahead
As Wallack begins her new job as the state’s Medicaid director, under the leadership of Elizabeth Roberts, secretary of the R.I. Executive Office of Health and Human Services, her role will be to implement the changes recommended under the reinvention of Medicaid: cutting tens of millions in the budget costs and improving quality outcomes through better coordinated care.

Here then, is the ConvergenceRI interview with Anya Rader Wallack, as she begins her new daunting task.

ConvergenceRI: As you are leaving HealthSourceRI, can you articulate what you see as the value of the agency and its work?
WALLACK: I think we have two central purposes and values we provide: one is to enroll individuals in Rhode Island in [health plan] coverage and give them an option to continue coverage.

We’ve made a significant dent in the uninsured rate; despite all of the progress, there’s still a lot of work to do.

Our value, hopefully, [is that] we can give people an easy shopping experience, better support for their decision-making and product comparisons, and hook them up with a tax credit.

Nine out of 10 had that cost reduction, so that’s job one.

Job number two is to help small employers, who are such an important part of the health insurance coverage picture, who so often are struggling to maintain [coverage for their employees].

Rhode Island’s exchange is somewhat unique [in the nation], providing small employers a shopping experience and product options that they wouldn’t get anywhere else, providing support for them to maintain their coverage, solidifying employer-sponsored insurance.

That’s central to our mission; we’ve had an impact there, but we’ve got lots more work to do.

ConvergenceRI: I have heard that one of the proposals under consideration to boost traffic through HealthSourceRI is to mandate state employee participation through the exchange? Is that something being discussed?
WALLACK: A “mandate” is not a word I would use. There has been some discussion with the state’s human resources department about whether it would make sense, in any way.

Does any such relationship make sense? There has been some analysis, which has eliminated some options about the way we might collaborate.

Other options still may be worth pursuing, [for which] more analysis about [them is needed.]

There has been a lot of interest by the Governor and the Lt. Governor about how by having a symbiotic relationship with state employees we [at HealthSourceRI] can provide some value.

[We could remove some of the] extra administrative burden from human resources; they could provide us some additional scale, knowing that scale is a challenge for us.

It’s way too early to say if that’s a win-win.

ConvergenceRI: What is the current status of moving from 50 to 100 employees as the definition of a small business group, as was initially planned under the Affordable Care Act?
WALLACK: Congress changed that, a few weeks ago, making it a state option, if we wanted, to pursue that change of [increasing the number of employees in a small group] up to 100.

I do not believe that will be pursued in the upcoming legislative session.

ConvergenceRI: Is there a need to be better able to demonstrate the economic value of the exchange to the R.I. General Assembly?
WALLACK: I feel like they support us. We did demonstrate that value, and they backed up us with a budget. We still have challenges in living within that budget, and in providing customers service that we need to.

The legislature has shown that they are supportive; we have made the case.

ConvergenceRI: I have heard some grumbling among brokers about the exchange and its small business option, known as SHOP. Have you heard similar rumbles?
WALLACK: Some brokers are extremely supportive and bring us a lot of business and produce quotes.

We have others, less familiar with the advantages or the value that we might bring to their customers, who believe [wrongly] that we’re going to muck up their relationship with those customers.

I have done a lot of running around, actively meeting with brokers. Most fell into the bucket that they were already working with us with small group size [firms].

Or, ‘Gee, I didn’t realize that it would be so easy to deal with you.’ Or, ‘I didn’t know that Neighborhood [Health Plan of Rhode Island] was becoming mainstream [commercially].’

There’s a lot of education still to do with brokers, but in no way is there a sense that they are enemies.

ConvergenceRI: What will be the challenges, as you see them, in the new job as Medicaid director? Are you stepping from the proverbial crocodile lake to the alligator pond?
WALLACK: Both jobs are challenging; director of Medicaid is particularly challenging, and with those challenges, an enormous opportunity.

There are few bigger challenges than achieving the agenda put forward by the Governor [Gina Raimondo] and the Secretary [Elizabeth Roberts].

Medicaid serves 260,000 Rhode Islanders, and it covers some of the most vulnerable Rhode Islanders. At the crux [of the challenge] is improving quality, reducing costs, integrating behavioral and physical health, all those things.

The goal is to improve the system of care and have a major impact on experiences and costs.

ConvergenceRI: As much as many folks have praised the work of the former Medicaid director, there are others who were not so positive about her performance. Were you aware of the negative opinions? How do you plan to address that?
WALLACK: Deidre Gifford was a consummate professional and incredibly proficient, hard-working and dedicated. [bristling] Are you asking me to throw her under the bus? I will not do that.

ConvergenceRI: No. I am only reflecting what I have heard in the community, from many who had expressed unhappiness with her performance, across a broad spectrum.
WALLACK: My role is to build and maintain good relationships with all our partners. It is the nature of the job of being Medicaid director that you will make some people unhappy.

ConvergenceRI: Switching gears, what kinds of data, research and analysis will be conducted as the plans to reinvent Medicaid are rolled out?

WALLACK: That’s a huge question. Within the Medicaid data warehouse, we [need to know] what those capabilities are there, ideally, to manage the data.

Medicaid is a big payer; [there needs to be] some kind of sophisticated data analysis that any major payer would have – what the population is, what are the characteristics, how they are using services – toward the goal of improving the quality, the services and the experience. 

[We need to] toggle all of the levers to manage the finances, the delivery of services, and the kind of providers.

Analyzing data is critical to any payer, probably even more so with Medicaid.

ConvergenceRI: One of the immediate challenges will be the ongoing attempt by Prospect Medical, the parent of CharterCARE, as well as Lifespan, to bring the managed Medicaid programs in Rhode Island under their networks. Are you familiar with the ongoing efforts here?
WALLACK: No, not with any of the specific terms. I am aware of new entrants in the market nationally, and that national companies are making big inroads into the business.

The key thing in my mind, no matter who the vendor you are contracting out to, is that, more than any other payer, Medicaid has to have strong systems of quality control and measurement of outcomes. All of the vendors, we need to hold them to very high standards.

ConvergenceRI: The position of the former director was that the rates being paid to managed Medicaid programs for community health centers were too high and that what was needed was for there to be a cap on any shared savings created. How will you approach that question?
WALLACK: That’s an issue that I’ve not been briefed on. It’s a fascinating issue that I am personally interested in, in risk contracting with plans and providers.

Editor’s note: In the original version of this story, ConvergenceRI referred to the figure of “$180 million in cuts” that Anya Rader Wallack would be managing in the reinvention of Medicaid plan implementation as the new director of the state’s Medicaid office.

A spokesman for the R.I. Executive Office of Health and Human Services wrote to ConvergenceRI to say that the description of the amount of those reductions in the state budget for Medicaid as just cuts was “misleading”: the reductions in the Medicaid budget involved both “savings” and “cuts.”

ConvergenceRI removed any references to the figure of $180 million in cuts until that figure could be checked and rechecked with a number of sources.

As a result, ConvergenceRI found that $166 million [$166,175,655] is the most accurate figure for total reductions in the state Medicaid budget for FY 2016 to be implemented under the reinventing Medicaid plan. It is taken directly for the most recent caseload estimating conference.