Hick’s ‘fix-it’ guy takes on exchange in ‘crisis’

By Katie Kerwin McCrimmon

Gov. John Hickenloper’s “fix-it” guy will be taking charge of Colorado’s troubled health exchange as managers and IT experts race to simplify the sign-up system before the next open enrollment season starts in November.

Kevin Patterson, right, served for 18 months as Gov. John Hickenlooer's representative on the health exchange board. Now he's set to take the helm as interim CEO.

Kevin Patterson, right, served for 18 months as Gov. John Hickenlooer’s representative on the health exchange board. Now he’s set to take the helm as interim CEO. At Patterson’s left is board member Steve ErkenBrack.

The board for Connect for Health Colorado met behind closed doors early Monday, then unanimously voted to make Kevin Patterson, the governor’s chief administrative officer, its new interim CEO.

Patterson will take over on May 8 and will be paid $199,200 per year. The exchange’s current interim chief, Gary Drews, had told board members he wanted to leave by mid-May.

Patterson will jump into choppy waters and must immediately try to fix IT glitches, find long-term revenue sources, and hire a new chief financial officer and chief operating officer. Those top posts have been vacant since early last fall.

The search for a permanent CEO is continuing, according to exchange spokesman Luke Clarke.

Exchange managers, board members and state officials face the daunting task of revamping an IT system that has snagged thousands of people who must first get rejected for Medicaid before they can sign up for private health insurance. On top of that, the exchange is supposed to become financially self-sustaining and can’t do that without significant hikes in fees or tapping into other cash sources like Medicaid dollars.

“Essentially we’re in a kind of crisis situation,” said board member Nathan Wilkes. “The real crisis is making sure that we are ready for the next open enrollment and with all the technology changes and fixes, making sure that we have the leadership in place to execute on that vision now.”

When the only announced finalist for the permanent CEO job withdrew from consideration earlier this month, Wilkes and other board members said they began to consider other options.

“We scrambled to go back and look at all of our alternatives,” Wilkes said.

Patterson did not apply for the CEO job, but had previously served for 18 months in 2013 and 2014 as a non-voting board member for the exchange board, so he’s familiar with the organization and its challenges. And, Hickenlooper has tapped him as a turnaround guy for three state agencies in the past. Patterson was interim executive director for the Governor’s Office of Information Technology, the Colorado Department of Local Affairs and the Governor’s Energy Office.

“He’s had a fix-it background,” said exchange board member Dr. Mike Fallon. “I think we need to be fixed, so as an interim person, he can very well address the problems right now. Whether he’s the right long-term answer, we’ll see.”

Fallon said Drews was not forced out and that Hickenlooper did not push to install Patterson.

“From an optics standpoint, it’s not ideal (to have the governor’s aide),” Fallon said. “But when we weighed all the pluses and minuses, I think he’s the best answer we have.

“Kevin has some skill sets that I think are going to help the exchange quite a bit,” Fallon said. “One of our biggest challenges is in the relationship with HCPF (the Department of Health Care Policy and Finance, the state agency that manages Medicaid). That is our biggest short-term challenge.

“He is going to be very good at trying to get us on a sustainable path with HCPF and help us define that relationship better and allow us to financially survive being intertwined unfortunately with HCPF,” Fallon said.

He said Patterson brings fiscal background that could help the exchange with financial sustainability, Fallon said.

Prior to working as one of Hickenlooper’s top lieutenants at the state, Patterson held leadership roles for the city and county of Denver in the Budget Office and the Planning Department.

“We know Kevin well and he knows Connect for Health Colorado well from his service on the board,” Sharon O’Hara, board chair for the exchange said in a press release. “Kevin brings a broad public policy background to this role and is well positioned to step in and build on the progress Gary has made while the board continues to seek a permanent CEO.”

Patterson will resign from the governor’s office to take the job at the exchange.

“I am excited by the opportunity to help more Coloradans get health insurance, to obtain the health care they need and to enjoy the financial security that comes with coverage,” Patterson said in a press release. “I am looking forward to working with Connect for Health Colorado’s talented and dedicated staff on their mission to increase access, affordability and choice for residents of Colorado.”

The leadership change comes at a time when the exchange is facing increasing scrutiny from a legislative oversight committee and from Colorado’s auditor.

The press release said the board chose a second interim CEO in order to work more closely with lawmakers who want to help interview and select a permanent leader.

Along with the changes among Connect for Health staff, the exchange could lose four board members in June. Fallon will be departing. Others could be reappointed.

As the search for a CEO stretched far longer than originally anticipated, Fallon said it has become clear that a new board should have a role in picking a permanent leader.

“Luckily for me, that’s going to be a decision for the next board member who takes my place,” Fallon said.

“I truly hope and I truly think it’s everybody’s hope that the exchange stays independent of both the state and the feds,” Fallon said. “No matter how bad things are, the federal exchange is worse and at least this way, there is some local control and local input. It would be my hope that the exchange is able to right the ship and be sustainable for the long term.”

Wilkes, another board member, said board members had to get very pragmatic and find someone who could lead the exchange in the short term.

“The crisis is making sure we have effective leadership in place to prepare for the next open enrollment period. We want to be able to get through that. Kevin brings some experience and he knows the organization,” Wilkes said.

Coming straight from state government, he may also be able to force the state’s Medicaid managers to work more effectively with the exchange.

“Hopefully we’ll be able to get the two to work collaboratively together,” Wilkes said. “I know we’ve done it before. Now we need to improve upon that work.”

Asked if Patterson can right the ship, Wilkes said he has confidence that Patterson can bring people together and hold the IT vendors accountable for producing a system that works.

But time is very short. In the past, the IT contractors have failed to finish the systems with enough times to test them and fix glitches.

“There are a lot of moving parts and a lot of people have to be involved. It’s the difference between being captain of a ship and steering a one-motor boat. One’s got a single rudder and another’s got a bunch of parts,” Wilkes said.

“This gets us through the iceberg-laden waters, so we can find somebody to fill the permanent job,” Wilkes said. “If Kevin wants to continue, he can put his name in for that.”

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