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State dropping contractor that created troubled health insurance website

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Massachusetts is dropping the contractor that created the state’s dysfunctional online health insurance marketplace, seeking to end a troubled partnership that has left thousands of consumers frustrated and many without coverage for months.

The state notified CGI last week that it was being terminated, and officials have started negotiating a transition. The $68-million contract with the Montreal-based technology consulting company expires in September, and Sarah Iselin, who was hired last month by Governor Deval Patrick to oversee repairs to the Health Connector website, said exactly when CGI finishes its work and how much the state pays for it are subject to bargaining.

Massachusetts has paid just $15 million to CGI and has not made any payments since the fall.

Iselin said she decided against scrapping the website entirely and starting again. Instead, she is leaning toward working with a new company.

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