Grassley says UnitedHealth acquisition poses possible health exchange monopoly [Pioneer Press, St. Paul, Minn.]

Dec. 11--Congressional Republicans are questioning whether a recent acquisition by Minnetonka-based UnitedHealth Group raises concerns about conflicts of interest in the development of health insurance exchanges.

In a letter issued Monday, Dec. 10, Sen. Charles Grassley, R-Iowa, asks a series of questions related to a UnitedHealth acquisition of Quality Software Services Inc., or QSSI, a Maryland company that has a federal contract to build a database hub for health exchanges.

The federal Affordable Care Act calls on all states, by late 2013, to have functioning health exchanges where individuals and small businesses can purchase coverage. Exchanges are meant to be user-friendly online marketplaces for buying health insurance much like the Orbitz and Travelocity websites for buying airline tickets.

"This contract creates a situation whereby the exchange's ultimate designer, QSSI, is in a position to tailor the system to favor the interests of its parent company, UnitedHealth Group, and further maintain a monopoly over information that is unavailable to competitors," Grassley wrote in a letter also signed by U.S. Rep. Fred Upton, R-Michigan.

The company, which is known as QSSI, was acquired by a UnitedHealth subsidiary called Optum in September, Grassley wrote. UnitedHealth also owns UnitedHealthcare, a large health insurance company that is expected to sell policies on health exchanges.

UnitedHealth's Optum division markets health services that, in some cases, are

used by its competitors.

"Putting our customers' secure and proprietary interests first is a hallmark of our service," the company said in a statement. "We look forward to responding to the committee's questions."

A Washington, D.C., newspaper, the Hill, first reported in November on the potential conflict of interest at UnitedHealth.

The hub contract is meant to provide technical integration services for routing information from one source to another, according to the federal Centers for Medicare and Medicaid Services, or CMS. The hub contractor will not make qualitative decisions about health plans in the exchange, the government said, and data will not be stored on the data hub.

Instead, the hub is meant to allow exchanges to securely submit questions about application information, and the federal government will provide information that the exchanges can use to verify the data. The hub, for example, will help verify whether an applicant qualifies for subsidized insurance coverage on a health exchange.

Christopher Snowbeck can be reached at 651-228-5479. Follow him at twitter.com/chrissnowbeck.

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