Healthcare

Behold the bloated $305 million corpse of Cover Oregon

Behold the bloated $305 million corpse of Cover Oregon

As big of a disaster as the federal ObamaCare exchange was, few blunders in the history of American governance come close to the Oregon ObamaCare exchange.  It was originally presented as the model of how ObamaCare exchanges could work.  Now it’s the model of how they don’t work.

At the end of October, the White House was praising the remarkable success of Oregon’s exchange, which had supposedly “covered 10 percent of its uninsured citizens already.”  The actual number of Oregonians covered by their exchange at the end of October was ZERO.  That’s still the number of people covered  by Cover Oregon online.  It has never enrolled a single person, despite an astonishing $305 million spent under the shockingly negligent administration of Democrat Governor John Kitzhaber.  And that’s $305 million of your money, dear reader, even if you don’t live in Oregon, because it came from federal grants.

(The bizarre White House boast turned out to be based on people going into Medicaid, which has nothing to do with Cover Oregon, or health insurance for that matter.  White House propaganda invariably mixed Medicaid beneficiaries in with ObamaCare sign-ups, until even the most Obama-friendly media began grumbling about this deceptive practice.)

A massive team of paper-pushers – over 500 of them, by some accounts – was hastily assembled to process dead-tree applications for health insurance, at a cost of roughly $7 million.  At the same time, $10 million was frittered away on bizarre advertising campaigns that urged Oregonians to use a website that didn’t work.  A special one-month enrollment extension was granted to Oregon, so they could process paperwork after the nominal March 31 deadline.  They’ve reportedly been able to process about 69,000 insurance enrollments using a “hybrid” system of paperwork and electronic resources, in addition to shuffling 171,000 people off to Oregon’s Medicaid program.

$134 million was paid to Oracle Corp for the non-functional website, followed up with a no-bid contract to Deloitte to try and salvage something useful out of Oracle’s work.  Deloitte tripled its initial cost estimates and concluded that it would take another $78 million to make this turkey fly – and even then, after further months of effort, the disastrous website still might not work – so it was recommended to convert Cover Oregon into a portal for the federal ObamaCare exchange, at a cost of somewhere between $4 million and $6 million.  And you’ll be paying for 90 percent of that, according to the “chief information officer” presiding over this debacle, because the conversion is eligible for $9 in federal matching funds for every $1 spent by Oregon.

Doesn’t six million bucks sound like an awful lot of money for rewriting one website so it simply redirects to another?  Especially since, according to The Oregonian, “Everyone enrolled so far may have to re-enroll, since it may not be feasible to transfer their data to the federal exchange.”  Also, five of the 16 insurance carriers currently involved in Cover Oregon will have to scrap and rebuild their electronic interfaces in order to work with the federal system.  Two of those “are new, consumer-operated carriers founded with federal loans,” which made the Cover Oregon exchange “central to their business plans.”  This is going to cost people a lot more than $6 million by the time it’s done.

According to the Washington Postfederal investigations have been launched into the Kitzhaber administration’s outrageous squandering of our money:

In March, the federal Government Accountability Office announced an investigation of Oregon’s exchange, including looking at whether the federal government can reclaim grant money given to Cover Oregon if taxpayer funds were mismanaged.

“It is the worst financial failure in information technology in state history — and it was completely avoidable,” said Rep. Greg Walden, who asked for the GAO probe. “Today’s admission of failure underscores the need to stop the waste and get the truth.”

Separately, former Health and Human Services Secretary Kathleen Sebelius asked for an inspector general’s probe into problems with the rollout of the health care law.

Thus far, a total of five officials have resigned over this mess.  Given the Obama Administration’s standards for “accountability,” and the dutiful concern they generally show for how tax money is spent, I wouldn’t expect much to come from these federal probes, but we’ll see.   Are we allowed to ask how the gigantic Department of Health and Human Services could have fallen so completely asleep at the switch, when it came to overseeing those Cover Oregon grants?  Or would that be a waste of time, since this Administration has yet to be held accountable for the even larger sums it blew on the bug-riddled federal exchange?

Final approval of the plan to scrap Cover Oregon is expected today, although the general sense emerging from local media is that it’s a done deal, supported by everyone from the state legislature to the Governor’s office.

Update: As anticipated, on Friday afternoon, the Cover Oregon board voted unanimously to scrap the state exchange and use the federal HealthCare.gov website instead.

 

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