Oregon poised to dump own Obamacare website, rely on HealthCare.gov

Citing high fix-it costs, Oregon is moving to drop its own underperforming website and to adopt the federal HealthCare.gov for enrolling residents in health insurance under Obamacare. Might other states do the same?

State of Oregon/AP
This screen image shows the website for Oregon's health care exchange.

Oregon is moving to ditch its troubled Obamacare website because the software is too costly to fix, seeking instead to join the 30-plus states relying on the federal website HealthCare.gov.

The move expected Friday would be the latest chapter in the saga of technical challenges that have burdened the launch of state-based marketplaces for buying individual insurance coverage under President Obama’s Affordable Care Act.

First came the opening-day breakdown of the federal gateway that serves most states. Although HealthCare.gov was ridiculed in its early months and still has big hurdles to cross, its performance improved amid a massive rescue effort by techies and crisis managers.

Some states, meanwhile, experienced their own debacles by creating faulty websites by themselves. Oregon’s site was so bad that it hadn’t been able to enroll a single customer as of early March, according to news reports. Enrollees in the state turned to paper forms instead.

Maryland and Massachusetts ended up with sites that also functioned poorly throughout the six-month enrollment process. Those states could end up following Oregon onto the federal website.

Oregon has tried to fix its website, which was created at a hefty cost funded by federal grants. But on Thursday, the state’s top technology official called for the state to pull the plug and shift to HealthCare.gov, saying the cost estimates for rescuing the state’s website were soaring too high, the Portland Oregonian reported Thursday.

The board of Cover Oregon, the state’s Obamacare marketplace, is expected to support that move in a vote Friday.

Some Republican lawmakers argue that US taxpayers shouldn’t have to pay any new tab for the state.

"Oregon's decision to scrap its exchange altogether and join the federal exchange means federal taxpayers have lost the $305 million spent on the site,” Rep. Darrell Issa (R) of California said in a statement released Thursday. “Going forward, federal officials should insist that Oregon foot the bill for the state's transition to the federal exchange. Federal taxpayers should not be stuck with the bill twice for this disastrous project.”

Mr. Issa chairs a House oversight committee that has become the venue for various critiques and investigations of the Obama administration.

Under Obamacare, all states including Oregon will need to start a new “open enrollment” season for health insurance on Nov. 15. The state exchanges also need to be ready to enroll people under special circumstances – such as when someone loses insurance because of a layoff – throughout the year.

The flawed Obamacare websites hold lessons that go beyond health-care reform. They are the latest reminders of the pitfalls of managing big custom software projects, which sometimes work, sometimes fail spectacularly, and usually cost lots of money either way. The travails are now case studies for Congress and states to learn from.

Congress’s Government Accountability Office is examining what went wrong with Oregon’s costly website and how other state-run websites fared.

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