The Federal Government's Obamacare Exchange Is Still Far From Complete, and It's Way Behind Deadline

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Whitehouse.gov

After last October's disastrous launch of HealthCare.gov, the federal health insurance exchange portal created under Obamacare, the Obama administration decided that some change, and perhaps even hope, was in order. In January, the administration fired the original exchange tech contractor, CGI Federal, and brought on a new firm, Accenture.

Normally, the federal contracting process is slow and arduous. But the administration needed to make the transition with a minimum of fuss. Partly that was to ensure continuity of service. But partly it was because the exchange project was still lagging far behind schedule. The back-end components that communicate with and make payments to health insurers—the "financial management platform"—were originally supposed to be finished before the site went live in October. But pre-launch delays kicked the work down the road. In November, during a congressional hearing on the botched exchange launch, a federal tech official revealed that between 30 and 40 percent of the system had not been completed. The expected completion date was revised and pushed back to January. But when January came along, and the administration decided to change contractors, the work still wasn't done. There was still no financial management platform in place to manage the law's complex network of subsidies and risk mitigation payments to insurers.

In a document justifying the rapid award of the new contract with Accenture, the administration warned that before long, this could be a huge problem. "Failure to deliver" the payment functionality "by mid-March 2014 will result in financial harm to the Government. If this functionality is not complete by March 2014, the Government could make erroneous payments to providers and insurers." Without a finished system, "the entire healthcare reform program is jeopardized." Missing the mid-March deadline would "significantly increase" a variety of risks for the program, and could "potentially [put] the entire health insurance industry at risk."

As an astute reader, you may notice that it is now the end of April. The mid-March deadline is long gone, and long blown. These crucial back end systems remain incomplete.

HealthCare.gov

And, according to a report in Politico, the administration has no timeline in place for when they will be finished. Nor will anyone in the know say how much work has been done. Politico reports that federal health officials "refused to provide an update on just how much of the back end remains incomplete, the current issues they face and their latest timetable." Not exactly confidence inspiring, eh? 

For the time being, payments are being made based on estimates from insurers rather than actual tracking—basically, they're guesstimating. And they're going to continue guesstimating for a while. But eventually, at some point, everyone has to start dealing with reality.

The Obama administration posted a document earlier this month indicating that insurers will continue to be paid through an "interim" accounting process—pretty much a spreadsheet and some informed estimates—until at least September. When the permanent system eventually goes live, it could lead to a massive correction that either exposes taxpayers to more costs or puts pressure on insurance companies to raise prices.

The best-case scenario here is that the delay isn't actually that big a problem, at least not in the short term, and the administration's original warnings were misleading—perhaps intentionally, or perhaps unwittingly. Either way, it's not good: They either knowingly overstated the risk, or they still don't have a strong handle on many key technical aspects of the exchange system. 

But given those early warnings, and the serious trouble the administration and its tech vendors seem to be having making this part of the system work, it's still at least plausible that there are more serious tech messes coming in the near future. At minimum, I suspect, even if there are no major disasters, the federal health exchange system will continue to be rickety and unstable for a while to come.

And remember—compared to several of the still-malfunctioning state exchanges, the federal portal is actually on relatively sure footing. 

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  1. “Failure to deliver” the payment functionality “by mid-March 2014 will result in financial harm to the Government.

    Yeah, no. The harm is to a certain political party for a certain upcoming election. Financial harm to the government doesn’t really enter into the thinking.

  2. If they gave the contract to Accidenture, then the project will never be completed.

    1. “On time, on budget, on schedule… pick zero.”

  3. I’m guessing that none of the gaping security flaws have been fixed either. Remember, the government straight up admitted that security was an afterthought, to be implemented at a later date.

    1. As sad as that is, do you know what will be sadder? In a year or two we’ll be seeing headlines about how hackers stole confidential medical information for millions of people, and we’ll be treated to quotes from all sorts of government operatives about how totally shocked they are and that nothing could have been done to foresee or prevent this, and by the way this wouldn’t happen if you would just double our funding.

      And everyone will believe them.

    2. Take an overview;

      “I see a very unconstitutional leader holding a healthcare plan trying to get away with something.”

      If they told you all the security holes were fixed would you be satisfied? How about if they were actively working on security? At this point, I’d feel safer if China or Russia were handling security, at least they’re an ocean away and don’t give two shits who I vote for.

  4. I wish I could enjoy this clusterfuck more, but the fact that it’s my (our) money being wasted kind of ruins what would otherwise be epic lulz.

  5. Yeah, this is all pretty much par for the course on giant projects like these. Just went through one, and this is for a profit-making enterprise. I can only imagine it’s exponentially worse in gov.

  6. Ocare is here to stay, baggers!. Dems will take back the house in November, running on Ocare!

    /derp

    1. The peanut gallery would agree with your sarcasm, but I happen to know it’s true.

      /shrike

  7. What still baffles me is why the government didn’t just buy eHealthinsurance.com or a similar competitor. Those sites had a portal that did everything the exchanges were supposed to do, minus the subsidy calculations. In fact, what was insanely ridiculous was the over-used talking point that Sebelius and others would use wherein they would state that “finally for the first time individuals have a website where they can go shop for health insurance!” completely ignoring the several sites that were already actively doing so.

    You can still go to those sites too, btw, and they still work.

    1. Because that would make sense, and wouldn’t grease the correct palms. It would soil them with the filth of innovation.

      1. wouldn’t grease the correct palms

        +1 crony contract

    2. They’re incomprehensibly incompetent. They are so fucking stupid and megalomaniacal and cronied up that they undoubtedly thought this was just something they could snap their fingers for, order that it be done, and that would be that. The contractor was happy to take the colossal amounts of money regardless of the feasibility of the project. It’s incompetence on a mindboggling scale. This can happen because there are no repercussions. This is the essence of government.

      1. It is more than that. It is that the government is so big that no one could make this work competent or no. The government is so big and tries to do so much that every agency is working at cross purposes with the other agencies. It sounds nice to link up the IRS and HHS and all the rest. In reality, however, that will never happen since each agency is doing so many missions and its databases are so specialize you can’t make them work together without screwing a lot of other stuff up.

        This whole thing is one of those cases where sometimes justice is served. Congress built this giant government charged with solving every problem imaginable and did it over a period of decades in a completely ad hoc way. The result is this hugely expensive and giant government that is so large and uncontrollable and trying to do so many different thinks that it rarely does the things it is supposed to do well and will never do anything beyond that well.

        If they were trying to stick this monstrosity on the government at say its 1965 or even 75 level, it still would have been a disaster but probably not as big of one and whatever it was it probably would have been implemented close to as intended. On the government today? Not a chance. We have such a giant and insanely constructed bureaucracy no new program no matter who well thought out will ever be properly implemented.

    3. Hubris and narcissism. It applies to everything this administration does. In their minds, the only reason healthcare isn’t free is because the evil Teathuglicans hate poor people. So, of course they know better than some evil for-profit companies about how to setup and run an exchange.

      1. This right here. “If a bunch of aspie programmers can do it, imagine what the finest public health minds at Harvard, Yale, and even Brown can come up with.”

      2. This isn’t unique to this administration. It’s how government works. That’s why you have so many little agencies all with the same stated goal. Dig in a bit and I bet you’ll find every one of those agencies has some custom piece of software made and maintained just for them. Duplicate agencies with duplicate custom software, and there’s probably a commercial alternative that’s better and cheaper.

        Their job as government is to spend money that does not belong to them. They do that well, but that’s about it.

        1. Don’t forget their core competency – killing people and breaking things.

    4. What still baffles me is why the government didn’t just buy eHealthinsurance.com or a similar competitor.

      According to the Emanuel brothers, those web portals don’t exist, so the government had to invent one from scratch.

    5. What still baffles me is why the government didn’t just buy eHealthinsurance.com or a similar competitor.

      Vanity and incompetence are my bets.

    1. Were they global warming deniers?

      /Tony

      1. They promised the Muslim Brotherhood a very fair trial before their hanging.

    2. The bailiff may fire when ready.

    3. In fairness, the military knows that the MB would do the same thing to them if they ever got the power. That is the problem with murderous lunatics like the Muslim Brotherhood, once they get any power, the only way to deal with them is to become a murderous lunatic yourself.

      That fact doesn’t make the current government any less murderous or more enlightened. It just points out how horrible the situation is all around.

      1. ROMNEY WOULDA DONE IT, TOO!

        There truly are no “good” choices anywhere in the Middle East, are there?

        1. Not really. There just are not. What would you do if you were running Egypt? Sounds easy to pardon all of these guys except that doing so will create the significant chance that they will some day take power and kill you.

          It may be that doing this will just make things worse and continue the cycle of violence. I am willing to admit that this could very well make things worse and not better. Maybe pardoning them will cause the MB and their supporters to rethink their ways and be less radical and killing them will just make the remaining ones more so. While that may be true, I don’t see how it is so obviously true that I can’t understand why the people in power there view it differently.

          Basically, the whole region makes you want to check out and never think about it again.

          1. This is why Assad is willing to kill everyone other than his family and loyal supporters. Only one group survives and he wants to be among the survivors.

            Think there’s another way out? Hold a seance and ask M. Gadaffy for comments.

            1. yes. And this is why Obama bears a good part of the blame for what is going on in Syria. Gadaffy tried to negotiate a peaceful exit and exile. Obama told him to fuck off, helped the rebels and Gadaffy ended up dead. After that example is it any surprise that Assad is willing to use chemical weapons and kill anyone and everyone to stay in power? What choice does he have?

              One of the keys to ending a conflict is giving one side a reasonable way to lose. Our idiotic intervention in Syria sent the message to Assad and really anyone else fighting an Islamist uprising that such ways no longer were available.

              You really can’t underestimate how profoundly stupid and incompetent Obama and his entire administration really are.

      2. In fairness, the military knows that the MB would do the same thing to them if they ever got the power.

        Weren’t they in power? And that didn’t happen?

        1. Only because the MB was in power but not quite enough in power to do it.

    4. You do know that after the coup it’s the old government (the military) back in charge, right?

  8. These are all very good points you make, but THE DEBATE IS OVER!

  9. Everything is proceeding according to plan, you BOOOOOOOSHFAG christpigz!

  10. They’re incomprehensibly incompetent. They are so fucking stupid and megalomaniacal and cronied up that they undoubtedly thought this was just something they could snap their fingers for, order that it be done, and that would be that.

    His Eminence: Marie and the Daughters Royal order stuff from Amazon all the time, and it just shows up like magic. Pfffft, how hard could it be?

  11. from Politico

    “.. it bolsters the Republican narrative that the government has mishandled the implementation of Obamacare

    Why can’t something be “reality” rather than something that benefits the evil opposition?

    1. Because BUSHTEATHUGLIKOCHDENIERCISRACIST! That’s why

  12. There was also concerns that the website sent duplicate applications to the insurance companies.

    I’ll take that 8 million number with a grain of salt.

  13. I’ve been saying this for almost 3 years now.

    This was a 5 year project that they tried to shoehorn into a little more than 2 years. Throwing a the shitton of money they did at it could have shaved a year off the completion date and had soft launch of the exchanges ready for NEXT March (basically open the exchanges but not have the mandate kick in till 2016) with the final pieces of the back end being finished off later in 2016 and all major components being fully operational and tested by March 2017.

    There was never any possibility of having the any part of the site really ready for 2014

  14. it bolsters the Republican narrative that the government has mishandled the implementation of Obamacare

    Pay no attention to that fiasco behind the curtain!

  15. Is there anything at all that Obumbles has not fucked up? As far as I can see everything he has tried has been a monumental failure.

  16. “The Obama administration posted a document earlier this month indicating that insurers will continue to be paid through an “interim” accounting process?pretty much a spreadsheet and some informed estimates?until at least September”

    The key words here are “at least.” Nothing will happen to reconcile the insurance ledgers until after November 4. Everything with this administration is driven by the electoral calendar, and there is too much risk of bad news for the administration to let the back-end go live before election day.

  17. When your healthcare becomes too expensive due to government regulation, don’t worry, the government will come in and wreck the whole damn thing.

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