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Pennsylvania hires California firm for state-based health-insurance exchange

The contract is expected to save the state more than $350 million on operations over six years.

FILE photo shows a user navigating Healthcare.gov, which Pennsylvania residents have been using since 2014 to sign up for health insurance plans under the Affordable Care Act. Now the state is planning to switch to its own online exchange.
FILE photo shows a user navigating Healthcare.gov, which Pennsylvania residents have been using since 2014 to sign up for health insurance plans under the Affordable Care Act. Now the state is planning to switch to its own online exchange.Read moreBloomberg

The new Pennsylvania Health Insurance Exchange Authority said Tuesday that it had hired GetInsured, a Mountain View, Calif., firm to set up and then operate a state-based health insurance exchange.

The new exchange will replace the federal Affordable Care Act exchange that the state has been relying on since 2014.

State officials said the authority will pay GetInsured $23.9 million to set up the system and then between $24.9 million and $29.5 million to operate it for the first six years, starting in 2021.

The state currently pays $90 million to use the federal site, Healthcare.gov; the new contract is expected to save the state more than $350 million over six years.

The law establishing the Exchange Authority, signed in July by Gov. Tom Wolf, also had a provision to create a reinsurance program designed to save consumers 5% to 10% annually on their premiums.

GetInsured already operates the technology for five state health exchanges, in Nevada, Idaho, Minnesota, California, and Washington, Pennsylvania officials said.