Cover Oregon Hires Turn-Around Expert for Interim Leadership

Clyde Hamstreet

Clyde Hamstreet

If ever there was an organization in Oregon in need of “turn around” consulting during a crisis situation, it’s Cover Oregon.

At its board meeting last Thursday, Cover Oregon’s board of directors approved the hiring of Hamstreet & Associates, a well-known Portland-based consulting company that provides crisis management consulting to businesses in organizational and financial distress.

Hamstreet will take on the role of interim executive director—Dr. Bruce Goldberg, acting executive director since Rocky King resigned, abruptly resigned on Thursday—and will provide “oversight in planning and implementing an organizational restructuring until handoff to a future executive director,” according to the contract between Hamstreet and Cover Oregon.

Hamstreet’s firm will also provide “limited support” for work being done to finish developing the exchange’s website.

Hamstreet is stepping in during a critical time for Cover Oregon.

By mid-May, the exchange is expected to hire its third executive director. Other key executive staff have also left, leaving the exchange, in many ways, rudderless.

More importantly, the board is on the cusp of making a critical decision: whether to scrap its deeply flawed website and join the federal exchange, or hire a new IT vendor to finish the website, which still cannot enroll individuals into health insurance.

Alex Petit, Cover Oregon’s interim chief information officer, told the board the exchange has already decided to not piggy-back on another state’s exchange because it would be too risky, as well as expensive and take a long time.

Joining the federal exchange clearly seems to be the simpler route: it’s the cheapest option, and could be done in time for open enrollment in November.

But it would mean abandoning an ambitious (and expensive) project that was expected to dove-tail with Oregon’s efforts to build an integrated and coordinated care model that could be a model for the nation.

For a state that has prided itself throughout its history for innovation and a governor who’s built his reputation on health reform, switching to the federal exchange at this stage in the game may be a hard decision to swallow.

If it were a foregone conclusion that Cover Oregon would be moving to the federal exchange—which would mean reducing staff and operations—the exchange might not have taken the step of hiring a firm specializing in improving its operations.

Hiring Hamstreet thus could be the exchange’s last-ditch effort to figure out if can it build its own exchange.

Cover Oregon has already paid Hamstreet & Associates a $40,000 retainer fee, and the contract stipulates that no more than $100,000 will be spent. Hamstreet bills $300 per hour, which is roughly equivalent to two months of full-time work.

Hamstreet is most well known for restructuring Sunwest, one of the largest senior living centers in the country, when it faced bankruptcy and foreclosure at the beginning of the recession.

It’s not clear when Cover Oregon first reached out to Hamstreet, but Dr. George Brown, the board member in charge of the executive search process, and the president and CEO of Legacy Health Systems, alluded to the audit conducted by First Data, and Governor John Kitzhaber’s response, as the catalyst.

“The governor gave clear directives,” he said. “How we arrived at this decision is driven by the amount of time we have to get the organization moving forward, and because of the reputation for the Hamstreet organization.”

“Because of the importance of the mission and the importance of the success of Cover Oregon, we need professional, consistent executive leadership to propel the organization forward, as well as to do a thorough evaluation of the organization,” Brown continued.

“I can’t promise anything at this point other than that we will do our best,” Hamstreet told the board. “We’re trying to get a good handle on the organization, where it’s going to go and how it’s best to get there. What this organization needs is a clear chain of authority.”