Sam Baker | National Journal | July 30, 2014 | 0 Comments

Obamacare Website Has Cost $840 Million

txking/Shutterstock.com

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's report, prepared for a House Energy and Commerce Committee hearing Thursday, details a long series of management, oversight, and contracting problems that plagued the entire process, from risky contracting practices in 2011 through the botched launch last October.

A massive repair effort got the site stabilized by January, and despite the early failures, the administration ended up exceeding its enrollment target for this year. More than 8 million people chose plans through Obamacare, including the 36 states whose marketplaces run through HealthCare.gov.

All the same, GAO says, similar problems could arise again without structural changes in the way the government manages its contracts and spending.

Here are the key findings from GAO's prepared testimony:

Rep. Fred Upton, the chairman of the Energy and Commerce Committee, noted that key pieces of the HealthCare.gov system—including the part that pays insurance companies—still haven't been built.

"The disastrous implementation of the president's health care law has already led to canceled plans, lost access to doctors, and higher premiums," Upton said in a statement. "Now add to that hundreds of millions of taxpayer dollars wasted on an exchange that is still not ready for prime time."

CMS spokesman Aaron Albright said the agency has already taken concrete steps to improve its management of HealthCare.gov.

"CMS takes its responsibility for contracting oversight seriously and has already implemented contracting reforms that are more extensive than the recommendations in the report, including ending our contract with CGI and moving to a new type of contract with Accenture that rewards performance," he said.

CMS brought in another contractor, QSSI, to coordinate the HealthCare.gov repair effort and has now directly hired Andy Slavitt, who spearheaded the project for QSSI. Sylvia Mathews Burwell, the new Health and Human Services secretary, has also created new positions with direct responsibility for HealthCare.gov and the federally run exchanges.

The agency is also in the process of formalizing internal guidelines that aim to prevent unauthorized work orders like the ones GAO discovered.

(Image via txking/Shutterstock.com)

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