Cost conundrum: Cover Oregon’s problems by the numbers

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by Shelby Sebens | Northwest Watchdog

Bruce Goldberg, acting executive director of Cover Oregon, told a legislative committee earlier this week it’s no secret the health exchange website is still not working, months after it was supposed to fully launch.

He could add the nation to that list.

What’s not known is how much will have to be cut to make up for the cost to fix it, whether it will ever be fixed and, as some  lawmakers vying for higher political office have suggested, be dumped and turned over to the federal health exchange system.

“At this point it is premature to make that decision,” Goldberg told lawmakers during the first of two legislative hearings Wednesday of the suggestion that Cover Oregon be dumped.

Cover Oregon Acting Executive Director Bruce Goldberg

He said the state will be in a better position to make that choice in a couple of months. It’s possible, he said, the site could be fully functional by then. Of the 48 “critical problems” facing the website, programmers are down to 13.

The state has so far enrolled more than 65,000 people, 23,000 of which are in private insurance, through paper applications. But some have slipped through the cracks and were unable to enroll.

Officials have been back and forth for months, extending the date when the website likely could be fixed. Many lawmakers are growing impatient.

“I have no confidence that many of the same individuals, agencies and companies that presided over this on-going disaster are in a position to salvage the state website,” state Rep. Jason Conger, wrote in an email to Gov. John Kitzhaber. “Indeed, I don’t believe they should be afforded yet another chance to fail — I have simply lost faith in this whole project.”

Conger, a Republican, has announced he’s running for the U.S. Senate seat held byDemocrat Jeff Merkley. He also sits on the House health care committee, one of two committees that grilled Goldberg on Wednesday over the Cover Oregon “train wreck.” Conger also said he wants a clearer picture of how much it’s costing to fix the problem.

Many other Oregonians are wondering the same. A response to a public records request from Northwest Watchdog shows what some of those costs will be. Some questions asked by Northwest Watchdog could not be answered, but officials say the information is being gathered.

Goldberg said the state can pay for the fixes within the budget by cutting other areas, such as future staffing and advertising. As of Nov. 30, Cover Oregon and the Oregon Health Authority have spent $166 million, including the cost to build the website and grants from the federal government.

Here’s a breakdown of the known and unkonwn costs of the Cover Oregon debacle and the dollars it might take to fix it.

$3.3 million: 400 plus employees hired to process paper applications. About $1 million of that came from Cover Oregon and the rest from the Oregon Health Authority from money saved through the state’s fast track Medicaidenrollment program, Goldberg said.

$228,000: The governor’s office has contracted with First Data GovernmentSolutions to conduct an independent review of the Cover Oregon website to find out what went wrong. Matt Shelby, communications strategist for the state’s chief operating officer, told Northwest Watchdog this is a fixed contract so the cost shouldn’t go up. Some lawmakers questioned the need for this during the legislative hearing, saying it shouldn’t cost the state to figure out what went wrong.

20 percent: Amount of the Cover Oregon budget that will have to be cut if the agency meets its lowest tier of enrollment projections. “We would be looking at all expenses, one of which is advertising,” Cover Oregon spokeswoman Ariane Hold toldNorthwest Watchdog.

Cover Oregon will also try to recoup more than $20 million from Oracle, the IT company that set up the website.

Holm said some of the cost questions cannot be answered yet as officials are still gathering information.

That includes:

  • Additional employees, includingoutside expertise brought in to help figure out how to fix the website.
  • Hiring a new executive director to replace Rocky King, who resigned last month. “We are in the process of finalizing a contract for the search firm and once final, we can share the cost,” Hold said.
  • Compensating Oregonians who fell through the enrollment crack and couldn’t signup by Jan. 1. The state is seeking federal permission to give tax credits to these folks.

The next couple of months will be crucial for Cover Oregon and the lawmakers who have backed the beleaguered website.

Contact Shelby Sebens at [email protected]

Northwest Watchdog is a project of the Franklin Center for Government & Public Integrity

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Posted by at 05:00 | Posted in Health Care Reform, Obamacare | 20 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Bob Clark

    “Money saved through the state’s fast track Medicaid!” Right, err, somehow Oregonians at large save public monies by causing a surge in Medicaid enrollment. The federal government will inevitably pull the rug out from underneath States relying on it fully funding any surges in Medicaid enrollment. Ultimately, there is no savings and the system likely implodes. It’s Kitzhaber’s Oregon Health Plan lottery system take-two on the horizon.

  • Jack Lord God

    Some questions need to be answered:

    1 – Why in the world is Oregon doing its own web site when the federal web site could have been used? That seems like the simplest most cost effective solution.

    2 – Why were funds spent on producing and running a bizarre folksy sing song ad when at the time those ads ran it was clear the site did not and would not work?

    3 – Where is Rocky King? Why is there no investigation into recouping funds paid to him when he clearly did not do the job?

    4 – What the hell are we doing spending $3M on workers to process paper applications when we could simply give up and dump the whole thing in the federal governments lap via using their web site?

    This is asininity. The whole thing was sold on two premises. Covering the 40 million uninsured and in the process, lowering everyone’s health care costs.

    Neither condition has been met, In the process we have spent a fortune for non working web sites and at this point have paper processing of applications and dumping a bunch of people on Medicaid.

    Never in my lifetime has there been such a clear and widespread example of the reason why getting government involved with this sort of thing is a losing proposition.

    The only premise of Obamacare that has been met has been the predictions of its detractors – that it would raise health care prices among a sea of incompetence. That part has come true.

    End it now. It doesn’t work. It’s time for everyone who said this was going to be great to admit they were wrong and frankly somewhat stupid for thinking you could add on 40 million people and lower everyone’s rates at the same time. Idiots.

    • DavidAppell

      Rupert Huse of Rupert Huse and Son ( of Springfield OR wrote:
      The only premise of Obamacare that has been met has been the predictions of its detractors – that it would raise health care prices among a sea of incompetence. That part has come true.

      False. Very false, and as is usual, Rupert Huse of Rupert Huse & Son provides no evidence to support his claim.

      Here is the data on the cost of medical care:

      As of December, it was up just 2.0% from a year earlier.

      Parts of the ACA have been in effect for well over a year now. So this is also relevant:

      “Medical-Price Inflation Is at Slowest Pace in 50 Years,”
      Wall Street Journal, 9/17/13

      • .

        Appell, your contempt for the Huse family is in itself, blather inflammatory – and, indicative of your being a left wing sociological pathos squire in a mire.

        • DavidAppell


          • .

            Bray tell driveling out from out Appell’s mouth: Focal epithelial hyperplasia.

          • DavidAppell

            Feh x 2

          • .

            Don’t be try’n to nail that light bulb hanging above your head P’nappell. Even a 40 watt sheds more light than the dim bulb on the end of your knows.

  • oregongrown

    And on October 1st, 2013, the same day Cover Oregon website opened for business (hahahaha) Kitzhaber was giving a PAID speech in another state, touting how great Cover Oregon was and how Oregon will set the standard for greatness. Hahahahahaha. This is the leadership that wants a fourth term?

    There is no excuse for the disaster that is Cover Oregon. No excuse for the incompetence that has run the costs over $200 million to get us back to 1970 and processing paper applications.

    And I am incredulous that anyone would vote for Kitzhaber for a fourth term. That is completely irrational behavior. We can’t afford all he’s done to us this term, let alone another four years.

    Working Oregonians are getting hammered to pay for more and more welfare, when the majority of us can barely buy our own health insurance, let alone find jobs.

    Kitzhaber has been the worst leader imaginable for Oregon. And that why our average income is still 9% below the national average, and why there are no new businesses moving here. But we are getting an influx of people, but these people will only add to the welfare rolls and the slide will continue with many more people taking a ride on the working people expected to pay for the ride.

    • DavidAppell

      Of course, without Kitzhaber in office — or, most likely, any Democrat — none of this expansion of health care would be happening. We’d be like any other red state, working as hard as they can to keep their poor residents from getting health care. (Except Kentucky, and, just the other day, Utah, who have finally admitted the inevitable — the ACA is a good deal for the poor residents of their state).

      • .

        Unmitigated bovine scatology – butthead, you bestow it from the get go, vin essence, square head legovit, , monSewer Ivan ingrapery…Lenin’ toward CONmunistic- ally.

        • DavidAppell

          Feh x 3

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