Shaun Zinck Jul. 29, 2015, 11:29am


ANNAPOLIS, Md. (Legal Newsline) - A healthcare company will pay the state of Maryland $45 million to avoid legal action after it allegedly failed to build a proper health care exchange website for the state, said Maryland Attorney General Brian Frosh on July 21.

Noridian Healthcare Solutions LLC will pay $20 million upfront to the state, and then will make $5 million installment payments over the next five years, Frosh said. The $45 million will mean the state will recover 61 percent of the total amount paid to the company to build the website.

"This company never delivered on what it promised, and, as a result, tens of millions of taxpayer dollars were wasted, and thousands of Marylanders suffered delays and frustration," Frosh said. "This settlement sends a message that the performance was unacceptable, and that those responsible will be held accountable."

The funds will be given to the state and the federal Centers for Medicare and Medicaid Services, which provided a “significant” amount in funding to develop the website and exchange. The agreement still needs to be approved by federal courts.

"Given constraints on the company's finances, it is doubtful that Maryland could have collected this amount from Noridian Healthcare even if it obtained an equal or higher judgment after years of litigation," Frosh said.

Noridian Healthcare Solution's parent company guaranteed at least $40 million of the agreed to settlement, Frosh said. Maryland was also released from any and all contract obligations it had with Noridian.

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