Another Obamacare Exchange Bites the Dust

by Patrick Brennan

Massachusetts, cradle of Obamacare (and liberty), is shutting down its state-run health-insurance exchange, the second state to do so. Oregon dropped its state exchange, which never enrolled a single person electronically, a couple weeks ago, and decided to use the federal one, Massachusetts is planning to use an off-the-shelf product that other states have used, but is considering the federal exchange if it fails.

Only 16 states tried to launch Obamacare on exchanges that they built, so two complete failures is nothing to scoff at — nor is the hundreds of millions of dollars states spent in their own money and federal grants to set them all up. (Oregon’s cost $305 million.)

Massachusetts’s system was such a disaster that, when applicants for subsidized health insurance couldn’t sign up using the exchange, they were placed in temporary insurance arrangements through the state’s Medicaid program. Perhaps most absurdly, Massachusetts had a working health-care exchange, Health Connector, that had helped cover almost all of the state’s uninsured residents after Romneycare passed. Obamacare’s regulations disrupted the existing plans, especially Massachusetts’s small-group market, and then Deval Patrick’s state government hired CGI Federal, the creators of, to build a new Health Connector (the new website was in part necessary because of the switch from Romneycare’s subsidy system to a federal one). Millions of dollars, 84,000 people temporarily put on Medicaid, and a bunch of waiver applications later, the Bay State has basically nothing to show for itself.

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