Federal Government to Switch Obamacare Tech Contractors



How's Obamacare going so far in 2014? The White House is insisting that the law is a success, but a spate of recent news items suggest otherwise. 

Just today, for example, The Washington Post reported that the Department of Health and Human Services plans to end its relationship with Obamacare tech contractor CGI Federal and switch to a new consulting firm, Accenture. The Post reports that the new firm is being brought on board after HHS concluded that CGI, "not been effective enough in fixing the intricate computer system underpinning the federal Web site." 

Given the troubled rollout of the health law's online exchange system last year, this is not entirely surprising. But it also suggests that despite the administration's happy progress reports, all is not entirely well with the federal exchange system, which covers 36 states. As the Post notes, "the administration's decision to end the contract with CGI reflects lingering unease over the performance of HealthCare.gov."

The move suggests that remaining problems may be bigger than the White House is letting on. Accenture, which built California's state-run exchange, does not have any prior experience with federal health IT systems. In other words, federal officials decided that CGI's performance was still so poor that it was worth the considerable startup and transition costs of switching to an entirely new technology firm.

You can see some of the lingering issues with the site in the Associated Press's story about Obamacare "orphans"—individuals who thought they had signed up for coverage under the law, but who have been told there's no record of their enrollment. The story estimates that about 13,000 people remain affected by the issue. And insurers say that there are other remaining sign-up glitches as well, such as duplicate enrollment identification numbers being assigned to multiple people.

Meanwhile, we still don't know the demographic breakdown of who is signing up for coverage under the law. But one big insurer says it now believes that its enrollment pool will end up weighted far more heavily toward sicker, more expensive individuals than it had previously expected. Humana projected yesterday that its risk pools would be "more adverse than previously expected," according to Reuters.

Granted, that's only one insurer. And it may simply be that younger, healthier individuals wait until March, the last month of open enrollment, to sign up for coverage.

The fact is, we still don't really know who is signing up and who is not, or even how many people have paid for their first month's enrollments. But unofficial estimates indicate that the figure is probably low—perhaps just 50 percent of sign ups. The fact that several insurers recently extended payment deadlines to the latter part of this month does not suggest that collection efforts are going smoothly.

What does the White House have to say about all this? Not much. As I noted in my column yesterday, the administration has not been particularly forthcoming with answers about the law. And that doesn't look likely to change soon: The White House officially signaled its opposition today to a House bill that would require the administration to provide data about how personal data was being used and secured under the law, saying the reporting requirements would be too "administratively burdensome." 


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  1. Why do “Deck Chairs” and “Titanic” spring to mind?

    Having dealt with both companies, there’s no improvement in this change, but I guess they have to spread the crony cash around while they spackle over the least eggregious cracks in the dam.

  2. I can’t wait to hear more about this in the coming months. It’s going to be a debacle on top of a debacle.

    If the exchange is anywhere near as many lines as reported, it’s going to take Accenture months just to identify the code that needs fixing. All starting from nothing, no prior experience, no knowledge of the code, no knowledge of the underlying systems.

    I have a love/hate relationship with watching non-tech people make tech based decisions. It’s hilarious when you’re not on the receiving end.

    1. The government bureaucrat in charge of funding the project I work on doesn’t understand the concept of concurrent versioning. So he banned it. Government is little more than a bunch of idiots telling the experts how to do their job.

      1. What do you use then, an eco paper process? Sort by date modified? He understands there isn’t really an equivalent system yeah?

    2. I think Accenture’s first order of business is likely to hire CGI’s personnel.

      1. Well, that is standard practice for other government contract changes. The only part that ever changes is the business card logo.

  3. Switching contractors-

    That seals it. The administration wants it to fail. There is no other reason for this.

    1. No, you underestimate the stupidity of the administration. For these bumbling technocrats, they think “ok, this was a political failure, bring in the next set of connected cronies and let’s fix this puppy so we can regain our political footing!” All their decisions are political, and no matter how much the technical person is going “no, no, no, this is a terrible idea”, all they hear is “who wants cake?”

      1. “who wants cake?”

        Shit. They all do.

  4. Anyone who knows anything about technology knows that switch contractors mid-stream is a sure-fire path to continued cost overruns and delays. As is probably true with just about anything (my knowledge is biased towards technology) it comes down to institutional knowledge. You cut ties with the contractor, then you are cutting ties with the people who know how the fuck things work. Even if they documented things to the Nth degree, there’s still a super-high transitional cost and ramp-up time.

    And software developers are the absolute worst documentors.

    This is a much bigger deal than WaPo is making it out to be.

    1. Well, at some point you have to hire someone who can complete the work. Not saying that is the case here, but I’ve worked with consulting firms who couldn’t tell their ass from a hole in the ground if you dug a hole and put their head in it to give them experiences with their head being in both places. Its like saying you never switch mechanics in mid repair.

      Never switch competent mechanics and/or contractors.

      1. Believe me. Hiring accenture is not a switch toward competence.

        I’m still laughing derisively at how moronic the politicians are. They done gone fired their quarterback and hired Tim Tebow.

        1. Sure, but its more like the swap of Christian Ponder for Josh Freeman. Just because Josh Freeman can’t get it done either doesn’t mean Ponder could.

        2. Dude, at least Tebow could throw an occasional touchdown. This is like putting Leela into the Blernsball game.

          1. You’re right. But only if she isn’t following a clown who bunts instead of swinging away….

          2. Nah, this doesn’t have the marketing appeal of a good beaning.

            1. It sure does from where I’m sitting!

      2. Well, at some point you have to hire someone who can complete the work.

        This maybe impossible. They might just have to start over. That is often much easier than trying to understand and then fix fundamentally flawed code.

        1. ^This.

          For Accenture starting over means shredding the documents that are the old code. They are experts at THAT.

    2. I bet Accenture is going to hire a crapload of people from CGI. It will be a lot of the same people working it, but with different managers.

      1. It’s the only sane way to proceed. All that’s changing is half of management, but not the half that matters. Can someone please explain why Sebilius still has a job? /rhetorical

  5. They hired Accidenture?!?!?!?!?

    HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA! HA!

    Those bozos hire guys who don’t know how to enter a formula into excel an bill them as Excel experts when detailing them to client sites!

    My prediction: they’ll chew through $1.5 billion in a single year and then say they need another $5 billion to make it work.

    The Obama adminstration is truly the George Castanza of administrations! They’re like that stupid dog my neighbor had who smothered her pups one by one by rolling over on them.

    1. Its brilliant. For once Accenture has someone else to blame for being late and over budget.

      1. Here is the spoof ad that we LTV managers were passing around as the contract upper management had “negotiated” with Accenture drove us into the ground.


        “Helping you go out of business is our only business!”

    2. One thing is for sure: they will go with the latest and greatest (and unproven) technology – which by definition means fewer skilled workers to choose from – instead of the most common technology. That ought to double the cost.

  6. from everything I’ve read, the colossal fuckups were not so much the product of failures by tech services providers, but rather things baked-into the very designs that HHS insisted that the technical implementation had to follow.

    The biggie was the requirement that a complete ‘registration’ be completed before any browsing of products be enabled, and that said registration required front end integration of ‘income confirmation’ in order to provide subsidy-included price estimates. That required integration/validation of data with IRS, which operated on entirely different protocols and had far higher security requirements than the Healthcare.gov system.


    “…Changes in the batting order of functions accessible by visitors to the website, such as enabling consumers to shop for health plans before fully registering, were made just weeks before its Oct. 1 launch date, according to developers’ testimonies before the House Energy and Commerce Committee. Full “end-to-end” testing of all of HealthCare.gov’s many component parts and connections as one integrated whole also was delayed until just weeks before its rollout….Others have alluded to the extra security protections needed in the federal registration as a burden on the system that hampers performance.

    1. This was my understanding as well. HHS either delayed making important decisions until it was too late or refused to make them at all. I doubt any company could have succeeded under those circumstances, competent or otherwise.

      In this game, the only winning move was to not play. (Unless you are a connected crony who knows he can milk the government and not suffer the market’s usual punishment for failures.)

    2. the colossal fuckups were not so much the product of failures by tech services providers,

      I think its both. This is the same company that royally fucked up Canada’s gun registration system, don’t forget.

      And things like, oh, I dunno, not building in any security to speak of are probably more on CGI’s head than Sebelius’s.

      1. And things like, oh, I dunno, not building in any security to speak of are probably more on CGI’s head than Sebelius’s.

        The first rule of contract work is “Build to spec.” I’ll bet the contract is very vague on security, if it mentions security at all.

        1. Healthcare has very specific security/privacy rules to which they are legally responsible under HIPAA.

          & I’m pretty sure the contract said somewhere “comply with all known laws, regulations, etc”.

  7. Let the W3C fix it. I’m sure they’ll be able to fit it in in between all the flame wars. And who better than the people that turned Firefox into the new IE6?

    1. I sincerely hope you realize how very little sense what you just said makes.

  8. Do they at least make CGI Federal keep personnel available so they can tell Accenture what the problems are or is Accenture going in blind? Going in blind probably means six months or more just trying to figure out what CGI did, let alone fixing it.

    1. Dude, you don’t get it. CGI gets paid a consulting fee to aid in the transition while Accenture gets paid to be consulted by them. It’s win-win!

      1. Ah, its the blind consulting the blind.


  9. “And it may simply be that younger, healthier individuals wait until March, the last month of open enrollment, to sign up for coverage.”

    Even if that happens, it doesn’t matter much to the death spiral. The issuers need to submit proposed 2015 premiums to state regulators in April, and they’re going to do it based on their claims experience for the first quarter of 2014. That is, the pool they have today is what will determine premiums for 2015. And if it’s bad enough, whether the insurers will stay in the individual/small business market at all.

    1. The two (02) goals for life this year:

      1) Short the market and retire.
      2) See this “death Spiral”

      I think my life may be complete soon.

  10. “Federal Government to Switch Obamacare Tech Contractors”

    Because whatever the problem is, it can’t be the law.

    Once they get the exchange problems fixed, the other problems with the law are going to be impossible to ignore.

    I’m really looking forward to Q1 2014 numbers from the insurers.

    Even if the government is backstopping them, it’s gonna be something to see how much money the government is giving the insurers.

    1. If they get the exchange problems fixed. If.

      1. They will eventually.

        I’m starting to wonder if it isn’t just a big cover for the rest of the problems with the law.

        Like the non-participation by the healthy. That’s a much bigger problem, and no amount of coding will fix it.

        1. They will eventually.

          Depending on what you mean by “problems” and “fixed, maybe, maybe not.

          We haven’t even really heard about the real problems: security, and the back-end interfaces.

          Remember: around half of the system hasn’t even been built yet.

          1. The back end stuff can, to some extent be fixed by shear manpower. Obamacare has already shown it is willing to depend on a bunch of drones entering and re-entering data. The security problems will require difficult code fixes. Every security feature they add at this point is going to cause a horrendous cascade of problems.

            There’s only two reasons Accenture would take on this problem:
            1. Management knows it can profit, even in failure.
            2. Management is insane.

            1. The back end stuff can, to some extent be fixed by shear manpower.

              No they can’t.

              The back-end stuff is where the actual application logic is. NOBODY KNOWS WHAT THE FUCK OBAMACARE REALLY MEANS.

              The law IS the SPEC. A law that large has to has contradictory specs in it, even by accident. But the spec can only be changed by an act of Congress.

              They can get the thing to function, but they’ll never get it to work.

  11. too “administratively burdensome.”

    Anyone know a good treatment for irony overdose?

    1. Schadenfreude. Just look for another story about an Obamacare supporter who’s premiums doubled.

    2. I don’t, but I bet your obamacare policy covers it.

  12. …individuals who thought they had signed up for coverage under the law, but who have been told there’s no record of their enrollment. The story estimates that about 13,000 people remain affected by the issue.

    How can they estimate that? It’s not like there’s a database of individuals who don’t have records in the enrollment database.

    1. If you’re willing to pull a number out of your ass you can estimate anything.

    2. Well, 13000 people have called the insurance companies that the insurance companies have no record of.

      1. It’s only January 10th.

        What happens when clinics and ERs call the insurance company in March asking about these people who think they’re covered by them?

        1. Eh. I am busy wishing death on the insurance companies right now. When my wife and I switched over to a single plan and added the kid, they told us it would be a $180 cost, payable by check only, and no they couldn’t invoice us or at least send a written email. Two weeks later we get a cancellation notice. Follow up, “oh, well the system got updated after the payroll deduction was submitted so you owe us $66.”

          Fuck these guys. I hope they all kill each other in the next 2 years.

          1. Fuck these guys. I hope they all kill each other in the next 2 years.

            If McDonalds screws your order up do you go berate the Burger King manager?

        2. I thought the same thing.

          The amount of people who have called to complain on Jan 10th is not the amount of people affected by this issue.

        3. What happens when clinics and ERs call the insurance company

          the hospitals are/have been freaking about this. nobody really knows. but it’s not like they’re doing to deny care.

  13. Humana projected yesterday that its risk pools would be “more adverse than previously expected,” according to Reuters.

    More adverse than you can imagine.

    I don’t know, I can imagine quite a bit.

    1. More adverse than previously expected?

      Most American don’t know about the backstop, but when they find out–and the checks are big…

      There’s just no way to pay for all those people with pre-existing conditions, and get gouged for all those new Medicaid patients, without sufficient needless participation from the young and healthy.

      The reaction by the American people to backstopping the insurance industry probably won’t be as big as it was as their reaction to bailing out Wall Street, but it’s going to be up there.

      ObamaCare’s worst days are yet to come.

      1. But the backstop is the insurance companies’ fault! Don’t you know that?

      2. As I understand it, there isn’t really a backstop. Rather, it’s a leveling mechanism that makes sure that if insurer A gets a sicker pool than Insurer B, the Government can transfer some premium money from A to B to even things out. It doesn’t solve the problem of every insurer overestimating the health of their pools. That is, at least, until Obama unilaterally changes how it works.

  14. Some like to point out “We implemented Medicare and SS, why is this so hard? It must be PRIVATE SECTOR incompetence.”

    No, fucktards. People under-appreciate how complicated all the process is that underlies this technology. The technology itself its tiddly-wink. Oooo XML files flowing between systems via FTP. BFD. It’s all about DATA and having counter-parties agree on definitions/usage/workflow of every single fucking data point across systems. And when you’re trying to bring in a boat-load of counter-parties under a regulatory framework that’s constantly evolving?

    Well shit… this never had a chance in the timeframe allocated. Yes, they implemented Medicare Part D. But first, that was optional. And second, it was phased. And third, it still took almost as much effort. And forth, it dealth with WAYYYYY less complicated data sets/workflows.

    Man am I enjoying this.

    1. But “failure was not an option”

    2. We implemented Medicare

      people also don’t understand what a disaster Medicare is.

  15. This reminds me of the way the government hires an advertising firm to produce anti-drug ads, then when the ads have no effect, they blame the ad agency and hire a new one. Happens every few years.

  16. Accenture = the crooks formerly known as (Arthur) Andersen Consulting.

    1. Arthur Andersen and Andersen Consulting were two parts of Andersen Worldwide. The AA were the traditional accountants and AC was the new technology consulting side.

      In the late 90’s there was a big turf war when they elected a new managing partner for the firm. The old guard at AA got most of the votes even though AC was growing faster and pulling in huge coin. AC resented it and bitched a lot. Eventually they decided to split into two entirely different companies.

      During the split, AA started doing technology consulting too. That was when they got caught at Enron shredding documents.

      AC (which had become Accenture) didn’t have any part of that.

      Full disclosure: I was hired at AC back in the 90’s and helped split the systems up when the companies parted. The AC office in Minneapolis was full of really bright people and I still sort of miss working there.

  17. Garbage in, garbage out.

    (Government Employees Insurance Company sure sounds like GIGO.)

  18. Well, you just don’t have the faith, gentlemen:
    “Obama lunches with youth promoting health sign-ups”
    Yes, five brain-dead Obots are joining the propaganda campaign in the hopes that millions of yutes are dumb enough to buy what they don’t need!
    Hey, our resident proggy imbecile is all for it!

  19. This decision will be blamed on republicans.

  20. Hell they should just hire both! Maybe a mariachi band too.

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