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Reforms promised, officials removed following audit of troubled Obamacare site built by Oracle

Chris Kanaracus | March 24, 2014
A newly released, independent audit of Oregon's disastrous Obamacare website implementation takes both state officials and site contractor Oracle to task, saying each side contributed to problems that have generated a political firestorm in recent months.

The governor said he also spoke on several occasions with Oracle President and CFO Safra Catz, the last time in a meeting with lawyers representing both the state and Oracle, which declined to comment for this article.

First Data's report is thorough and "you really have the feeling it was independent," said analyst Michael Krigsman, CEO of consulting firm Asuret and an expert on the roots of IT project failure.

Cover Oregon appears to have been "a project managed by committee," he said. "The goal of that is to get multiple points of view. The negative, what usually happens, is that there's no one who's actually responsible."

The state's decision to hire Oracle consulting on a time-and-materials basis was also a bad move, Krigsman said. "In the long run it's the worst way to go about it because it means the systems integrator does not have sufficient accountability." When consulting hours aren't connected to a concrete plan, "then it's a consultant's dream."

That said, "there's no one who looks good in this," Krigsman added.

Even if the website is stabilized relatively quickly, the Cover Oregon controversy could remain in the headlines for some time.

Oregon is withholding US$25.6 million in payments to Oracle, out of some $69.5 million the vendor says it is owed. It has also reserved the right to sue Oracle, an option Kitzhaber alluded to during the press conference.

The state is "very disappointed with the quality of [Oracle's] work and the product they've given us," he said. "We are prepared to pursue whatever legal means might be necessary." However, that matter is now under review by the state attorney general, Kitzhaber added.

The state agreed to pay Oracle a majority of the $69.5 million in order to ensure a smooth handoff of the project to the state, Kitzhaber said.

Cover Oregon's woes have political implications for Kitzhaber, who faces re-election in November. "The taxpayers should hold me accountable for, obviously, the problems with Cover Oregon," he said during the press conference. "This happened on my watch and the buck stops here."

However, voters should also take into consideration the fact that nearly 300,000 residents have managed to sign up for health care through a combination of the website and other means, as well as steps Kitzhaber is taking to "move us toward a better, more functional system."

These measures include a review of the state's IT procurement practices, as well as a task force including CIOs from Legacy Health and Kaiser Permanente that will "advise Cover Oregon on IT options going forward," according to a statement.

He's also asking for the U.S. Government Accountability Office, which is reviewing the Cover Oregon situation, to "include a thorough appraisal of Oracle's inability to properly estimate the amount of work necessary to complete the project, to deliver on key deadlines, and to adhere to industry standards."


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