Congress, Politics, Society, Uncategorized

Obama Administration To Spend $1.7 Billion On Healthcare.gov

220px-US-DeptOfHHS-Logo.svgThe latest figures are in on the seemingly bottomless hole that is healthcare.gov, the troubled federal insurance marketplace web site. By any measure, the Obama Administration was grossly negligent in the creation of the system, which ultimately failed on its rollout despite numerous warnings of substandard work, overruns, and major technical problems. It appears that we are not done with bill for the program. A new Inspector General report stated that the Obama Administration issued sixty contracts from 2009 to 2014 to build Healthcare.gov, which had already cost roughly a half a billion dollars by February 2014. However, the Administration has signed new contracts that obligate the taxpayer to cover an addition $300 million, and the estimated value of the sixty contracts totals $1.7 billion. Despite numerous accounts and reports on the mismanagement of this program, there appears to be little real effort to hold anyone accountable as we continue to pour hundreds of millions into this system. The contracts include money to CGI Federal, the well-connected company that was partially response for the disaster in October as well as other controversies in large contracts.

With some contracts obligating as much as $200 million, healthcare.gov has become a major cash cow for some companies like Booz Allen Hamilton, Deloitte, Lockheed Martin, Northrop Grumman and HP Enterprise Services. Of the 60 contracts, nearly $800 million has been committed for the development of the Federal Marketplace as of February 2014.

Healthcare.gov_logoWorse yet, The Hill is reporting that the Administration is due to pay at least 20 contractors more than their original estimates for work on HealthCare.gov and the rollout of ObamaCare. Thus, the overruns are continuing and, despite the dismal work done on the rollout, even the most dubious companies are continuing to benefit from the windfall. Most notably, while one 2011 contract with CGI Federal was estimated to be worth $93 million at its awarding, CGI Federal could ultimately receive more than $200 million. The CGI Federal contract (and its dismal performance) has been the source of considerable criticism over the companies connections to fundraising for the Obama campaign and personal connection to the First Lady (Toni Townes-Whitley, a senior vice president at CGI Federal, was a Princeton classmate and friend of First Lady Michelle Obama). I am less concerned over the personal relationship allegations (which seen speculative at this point) as with the simple question of how a company (one of a number of companies) could continue to produce subpar work on a major federal project and still receive massive overrun payments.

What is maddening is that the House of Representatives killed one of the oldest programs in the United States, the page program, for $5 million dollars but it barely makes news that we will spend $1.7 billion on a grossly managed marketplace website. Overruns are shrugged off and you will barely find any mention of the IG report among the major media.

141 thoughts on “Obama Administration To Spend $1.7 Billion On Healthcare.gov”

  1. Seldom ever mentioned in all this “discussion” of the ACA…is the fact that an actual program was already in place and had be working rather well for over 50 years…e.g., the Federal Employees Health Benefit Program (FEHBP), administered by OPM on an existing database. The FEHBP could have been adapted to address the primary goals of the ACA. It is a state by state system of private insurers contracting to provide coverage for a given price. Even employers could have signed on and saved money if they chose to do so. Fact is even John Kerry proposed this in 2004. Heaven forbid we’d tried a truly portable, actually working system, already in place for 50+ years, requiring only the hiring of a few mid level GS Schedule civil servants to handle increased volume (volume is NOT a criteria for adding grade creep positions per OPM regulations). Right there you can begin to see why no DC habituate wanted to use it…no crony benefit.

  3. While the ACA isn’t the best health care paradigm, it’s far better to funnel money to health care generally than to killing people around the world. Better health care would reduce the desperation that undermines peaceful coexistence and a sustainable future.

  4. People, there is no incompetence here, this is a feature not a bug. The federal government exists for the purpose of funnelling cash to its compaign contributors. You even mention yourself, Dr. Turley, that there are connections to campaign contributors. Of course there are. That’s why the website exists. Its secondary purpose is to serve the public. Its primary purpose is to shovel federal dollars into the bank accounts of Washington insiders. Mission accomplished.

  5. @Beth Meier

    Well, where there is limitless incompetence, there should be limitless coverage thereof. “Sibelius ” should become a new slang term for “oblivious “, too.

    Squeeky Fromm
    Girl Reporter

  6. Edward, BINGO. JT was very tough on Bush when he was lawless and incompetent and now on Obama. Cultist don’t understand intellectual honesty. They’re hardwired differently than regular folk.

  7. Beth-One of the wonderful things about Professor Turley’s blog is that he has principles and is willing to call out Democrats & Republicans. Wrong is wrong in his book. Might I suggest the Daily Kos or MSNBC if you just want to hear the administration’s talking points regurgitated to you.

  8. Meier, just whose fault is all of this then, provided you acknowledge there is anything wrong at all?

  9. This article should be on a fox media page, along with all the hate comments. When news is boring, lets beat up on Obama. Boring boring boring. You might make a bigger impression and people actually care if it wasn’t always Obama’s fault. What a waste of a click

  10. I don’t think it is a spine issue. If memory serves me anymore–to any extent, the web guy was a big campaign donor. Fired, then rehired?? It would be interesting to see where some of that huge amount of cash ends up in time. Like I said, it looks like there is no line between corporations and government. Probably like the banks, the first big payment to site firm probably went to bonuses and such.

  12. Disgraceful. I’m glad the author sees wrong where too many others can’t or won’t. For once, will just one liberal come from his crawl space and agree with the author!

  13. Obummer Administration…. Massive In competence…. This is what happens, when we elect a President who has no spine & no Balls……..

  14. Oink, oink, oink. Remember, there were a couple of pretty good programmers who wrote a better version of this site in a weekend. There’s your government at work. Seems like every business that interacts with the government gets a sweetheart bank-bailout deal.

  15. The Republicans warned that this would happen. Not a single Republican voted for this program, but the Democrats forged along full steam ahead anyway, not caring about the warnings coming from half the country. Instead they vilified Republicans, falsely claiming that we don’t care about the sick and that we were not serious about healthcare reform. People need to remember the truth when election time comes. We need real healthcare reform by the fiscally responsible.

  17. We have a history of not expecting reality to happen:

    ON THE night of October 22, 1929, one of America’s most widely known economists addressed a great banquet of credit men. Not only were Wall Street prices not too high, he told his delighted hearers, but we were really only on the threshold of the greatest boom in the nation’s history. The prophecy evoked a burst of applause. Next morning, a few minutes after the great bell announced the opening of trading on the Stock Exchange, the storm broke. The greatest economic depression in our history was formally ushered in — though it had been in progress for some time. From this point on, as the country slowly roused itself to a consciousness of the far-spreading crisis, leaders in politics and business repeated with invincible optimism that it was all just a wholesome corrective. After several years a waggish commentator published a little volume called Oh, Yeah! It was a sardonic recording of the persistent and unconquerable stream of promises of quickly returning health. There you will find recorded the statements of statesmen, financiers, university professors, leading economists, and editors assuring the people that it was all a blessing in disguise, a corrective phenomenon, that the broad highway to renewed prosperity lay just ahead. All of which proved quite conclusively that these men did not know what they were talking about because they had no understanding of the economic system under which they lived. Then came the collapse of 1933 on the grand scale — and a resumption of the bright prophecies of happy days.

    (Banker Jekyll Will Hyde Your Money – 11). More recently, they did not see worse than that coming either:

    Former Federal Reserve Chairman Ben Bernanke, a prominent student of the Great Depression, contends that the 2008 financial crisis was actually worse than its 1930s counterpart.

    Mr. Bernanke is quoted making the statement in a document filed on Aug. 22 with the U.S. Court of Federal Claims as part of a lawsuit linked to the 2008 government bailout of insurance giant American International Group Inc.

    “September and October of 2008 was the worst financial crisis in global history, including the Great Depression,” Mr. Bernanke is quoted as saying in the document filed with the court. Of the 13 “most important financial institutions in the United States, 12 were at risk of failure within a period of a week or two.”

    Former Treasury Secretary Timothy Geithner is quoted in the document offering a similarly apocalyptic assessment. From Sept. 6 through Sept. 22, the economy was essentially “in free fall,” he said.

    (ibid, quoting WSJ).

  18. The people were warned over and over again that this healthcare program would be like a Mammoth in the a small room and it would squeeze us all to death–but no one listened. The people were warned how big promising government programs come with exorbitant costs,bloated, and always mismanaged–but no one listened.
    When will people learn?

  19. It ‘s less the money to me and more the gross managerial incompetence. But what else can you expect from a bloated bureaucracy and a President with no real world job experience? Except scooping ice cream at Baskin Robbins. We have the government we deserve.

    Squeeky Fromm
    Girl Reporter

  20. It is indeed a sin that the House obliterated the page program, for mentorship and leadership is precisely what is lacking in our government “of the people, by the people”.
    No wonder “we the people” have this government we’ve created…

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