GAO: Healthcare.gov Trainwreck Resulted From Obama Admin Incompetence

Guy Benson

7/31/2014 2:46:00 PM - Guy Benson


Well, yeah. Obviously. But to hear the administration tell it, all those migrane-inducing rollout, er, hiccups ought to be laid at the feet of the private contractors who screwed everything up. Remember this?


A week after the contractors who built HealthCare.gov blamed the Obama administration for the site's failures, the administration is shifting the blame right back. Health and Human Services Secretary Kathleen Sebelius will tell a House committee tomorrow the site's botched rollout was the result of contractors failing to live up to expectations – not bad management at HHS, as the contractors suggested. "CMS has a track record of successfully overseeing the many contractors our programs depend on to function. Unfortunately, a subset of those contracts for HealthCare.gov have not met expectations," Sebelius said in prepared testimony for tomorrow's hearing before the Energy and Commerce Committee.


That would be the same disastrous October testimony in which Sebelius claimed Healthcare.gov had "never crashed." Healthcare.gov was crashed throughout the duration her testimony. CNN even put up a memorable live split screen. The nonpartisan Government Accountability Office has been assessing Obamacare's failures and renders a judgment on the administration's culpability amid the blame game:


Management failures by the Obama administration set the stage for computer woes that paralyzed the president's new health care program last fall, nonpartisan investigators said in a report released Wednesday. While the administration was publicly assuring consumers that they would soon have seamless online access to health insurance, a chaotic procurement process was about to deliver a stumbling start. After a months-long investigation, the Government Accountability Office found that the administration lacked "effective planning or oversight practices" for the development of HealthCare.gov, the portal for millions of uninsured Americans. As a result the government incurred "significant cost increases, schedule slips and delayed system functionality," William Woods, a GAO contracting expert, said in testimony prepared for a hearing Thursday by the House Energy and Commerce Committee. GAO is the nonpartisan investigative agency of Congress.


The report concluded that "contractors were not given a coherent plan, and instead jumped around from issue to issue," and that the administration "failed to follow up on how well the contractors performed." The Associated Press' story on the findings repeated the claim that "eight million" consumers signed up through Obamacare's exchanges. This isn't accurate. According to estimates, roughly 15-20 percent of "enrollees" never paid their first premium, and therefore did not initiate their coverage. A health insurance executive said yesterday that an untold number of additional actual enrollees have ceased making payments, voiding their coverage. The "eight million" figure also includes a substantial number of duplicate enrollments, as millions of applications have been impacted by data discrepancies that are expected to end up charging them more, or terminating their plans entirely. The majority of "new" enrollees being touted by the White House already had insurance prior to Obamacare; a large portion of these people represent those whose existing plans were canceled under the new law, in violation of an opt-recited presidential vow. The GAO also just blew the whistle on woefully insufficient eligibility verification procedures, noting that 11 of their 12 fake customers were able to obtain coverage online or over the phone. All of these problems are exacerbated by a federal data hub whose 'back-end' payment systems have still not been built, and aren't expected to go live until sometime in 2015. A separate population of consumers who may like their new plans stand to face sharply higher bills next year after they're automatically re-enrolled in plans with shifting costs. If they don't want to pay more, they'll need to switch coverage -- again, in many cases. Obamacare consumers across the country have been complaining about trouble finding doctors and facilities that accept their plans, and a rash of premium increases have been been announced for the coming year. National Journal reports on how much taxpayers have already sunk into Healthcare.gov:


The Obama administration has spent roughly $840 million on HealthCare.gov, including more than $150 million just in cost overruns for the version that failed so badly when it launched last year. The Government Accountability Office says cost overruns went hand-in-hand with the management failures that led to the disastrous launch of HealthCare.gov and the 36 state insurance exchanges it serves...GAO says similar problems could arise again without structural changes in the way the government manages its contracts and spending.


That figure doesn't count the billions spent on state-level exchange websites, including hundreds of millions of dollars flushed away on failed or abandoned exchanges in states like Oregon, Maryland and Massachusetts. Administration officials at first didn't expect to have to build any exchanges, assuming that all 50 states would create their own, as outlined in the law. Most states declined to do so, however, yet Team Obama delayed and hid much of its work on the federal marketplace until after the president had been safely re-elected. The law's plain language states that only consumers who purchase plans through state-based exchanges are eligible to receive taxpayer subsidies, but Obamacare defenders say that was never the intent of the law -- creating a mess of contradictions and dishonesty. The best summary I've seen on the issue is here. Based on conflicting circuit court rulings issued within the last few weeks, the issue seems destined for the Supreme Court. I'll leave you with this, breaking today:


U.S. consumers who purchase private health coverage through the federal Obamacare website HealthCare.gov are likely to find only modestly higher premiums but may still have technical problems signing up, a top health official said on Thursday. "It won't be perfect," Andrew Slavitt, a newly appointed principal deputy administrator at the Centers for Medicare and Medicaid Services (CMS), told lawmakers at hearing before a House of Representatives oversight committee. "It's a bumpy process at times," he added. "I think we've got a committed team of people, though, that by and large are doing a very good job. But there will clearly be bumps."


Coming soon: Higher costs, more glitches. That, according to a high-ranking Obama administration official. Current and upcoming premium increases are being held down by bailout-style taxpayer payments to insurers through channels established in the law. The administration unilaterally expanded this hefty assistance at insurers' behest in order to head off even higher cost spikes.