Maryland State and Federal Government Fines US$45 million to Developer of Flawed Healthcare Website

Published Date : Jul 22, 2015

Maryland’s state and federal government has ruled out a fine of US$45 million to the prime developer of the flawed health exchange website built for the state. The state’s attorney general has said that the fine will be required to be paid for the company to avoid legal actions in relation to company’s performance by the federal government.

The website built for the health exchange program of the state made headlines in 2014 when it observed the worst sign-up rates for the Affordable Care Act of President Barack Obama. Noridian Healthcare Solutions LLC, the company that developed the website, has agreed to pay the fine in parts – as up front payment of US$20 million and the remaining US$25 million in yearly installments of US$5 million over tenure of the coming five years, stated state officials. 

These payments form a 61 per cent of the total amount the company was paid for developing the failed website that was launched in the year 2013.

Brian Frosh, Maryland’s Attorney general said that the company did not deliver what it promised in the first place, leading to the loss of millions of dollars paid by taxpayers. As a result, thousands of Marylanders had to suffer from frustration and delays.

This settlement is an example of how when the performance of a service was unacceptable, the ones responsible for the act will be fined by law. The agreement, which is bound by regulatory approvals, will allow compensation of the funds for federal centers for Medicaid and Medicare services and for the state too.

It is, however, not yet made clear as to how the recovered funds will be split between federal government and the state of Maryland.