Up to 40 percent of Obamacare’s ‘back office’ functions yet to be built, tech chief says


Henry Chao, deputy CIO and deputy director of the Centers for Medicare and Medicaid Services' Office of Information Services, testifies during a hearing before the Oversight and Investigations Subcommittee of the House Energy and Commerce Committee on Tuesday. (Alex Wong/Getty Images)
November 19, 2013

Henry Chao, the Obama administration official who oversaw the technical development of the federal health insurance marketplace, said Tuesday that his team has yet to complete 30 to 40 percent of the overall project.

Speaking before a subcommittee of the House Energy and Oversight Committee, Chao said the Centers for Medicare and Medicaid Services is still working on a number of “back office” aspects of the project, including a system to send payments to insurance companies.

Parts of the project that users would see — notably the Web portal, HealthCare.gov — are 100 percent finished, he said. But “the accounting systems, the payment systems, they still need to be” completed, Chao said.

The payment system Chao referred to relates to the subsidies many low- and middle-income people will receive to help them buy insurance on the state and federal Web sites. In most cases, government subsidies will be paid directly to the insurers. People getting the subsidies will simply pay the discounted premiums.

Also yet to be finished is a component that ensures that the state and federal marketplaces and the insurers have accurate, matching information about enrollments. Officials are also still working on a system that makes payments to insurers that attract high-risk patients. These systems must be in place by January, officials have said.

Although enrollment numbers for insurance exchanges set up in states by the federal government won't be available for several weeks, states operating their own health-care insurance exchanges under the Affordable Care Act, and the District of Columbia, have started to release enrollment data.

“This is a complex project with a short timeline,” Health and Human Services spokeswoman Joanne Peters said in a statement. “As such, issues were prioritized to meet the October 1 launch date.”

Chao said the work should not directly affect the ability to use HealthCare.gov, the federal Web site for people in 36 states to compare plans and prices and apply for government subsidies to pay their premiums. Officials have said the Web site should be working smoothly for 80 percent of users by the end of the month.

The remarks came during a hearing that was supposed to center on the security of people’s private information entered into the site. But much of it focused on a document prepared by an independent firm that last spring had warned high-level White House and Health and Human Services officials of many of the problems that have arisen since the Web site’s troubled Oct. 1 rollout.

News of the McKinsey and Co. briefings was first reported Monday by The Washington Post, which obtained the presentation from the Commerce Committee. Chao told the panel he had not seen the document.

In his prepared testimony, Chao said the federal marketplace had met all security standards, and that there were measures in place to continually root out any threats. CMS and contractors on the project were “hard at work to design, build, and test secure systems that ensure Americans are able to enroll in affordable health care coverage,” he said in his prepared testimony.

Sandhya Somashekhar is a health reporter for the Washington Post.
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