During the two years before the disastrous opening of HealthCare.gov, federal officials in charge of creating the online insurance marketplace received 18 written warnings that the mammoth project was mismanaged and off course but never considered postponing its launch, according to government investigators.
The warnings included a series of 11 scathing reviews from an outside consultant — among them a top-10 list of risks drawn up in the spring of 2013 that cited inadequate planning for the website’s capacity and deviations from usual IT standards. A few months before, then-Health and Human Services Secretary Kathleen Sebelius had hired another consultant to review the project and recommend ways to improve its management, but its advice was never shared with the technical staff working on the website.
The long trail of unheeded warnings is among the findings from an exhaustive two-year inquiry by HHS’s Office of Inspector General into the failings of HealthCare.gov, which crashed within two hours of its launch on Oct. 1, 2013. The failings tarnished the start of a central aspect of the Affordable Care Act — new insurance marketplaces for Americans who cannot get affordable coverage through a job — and embarrassed the White House, which championed the law.
The findings are contained in a “case study” to be released Tuesday. It represents the most penetrating look ever into what went wrong with the building of the federal insurance exchange and what was done to fix it. It is based on interviews with 86 employees of HHS, its Centers for Medicare and Medicaid Services (CMS) and companies that worked on the project, as well as on several thousand emails, memos, government contracts and other internal documents.
Many of the basic contours laid out in the 84-page report are, by now, familiar: Federal health officials failed to recognize the enormity of the undertaking, were disorganized and fragmented, were hampered by late and shifting ACA policies, had too little money, used poor contracting practices, and ignored problems until it was too late.
But the inquiry unearthed vivid details that have not been public. And it concludes that the central reason for the problems rested not with the shoddy work of vital IT contractors but with mismanagement by federal health officials carrying out this part of the law.
“CMS didn’t need a technical surge, they needed an organizational surge,” an agency employee told the investigators. A lack of leadership, the report says, “caused delays in decision-\making, lack of clarity in project tasks and the inability of CMS to recognize the magnitude of problems as the project deteriorated.”
The investigators also concluded that once the crisis erupted (only six people nationwide managed to select health plans through HealthCare.gov on its first day) the initial repair blitz was not primarily the result of the “tech surge” ballyhooed by the White House — the talent quickly imported from Silicon Valley and other leading IT firms. The turnaround was fostered mainly by an abrupt culture shift in which government workers, contractors and the tech imports worked hand in hand, initially at a command center in Herndon, Va, Va. Within two months, about 4 in 5 consumers could use the website.
Over the past two years, top federal health officials have apologized for HealthCare.gov’s troubled start, and President Obama has called it a “well-documented disaster.” CMS spokesman Aaron Albright said the problems cited in the report taught the agency lessons about “leadership, accountability and prioritization” that it has applied to its work since.
Among the report’s revelations:
●In the summer of 2013, CMS officials asked CGI Federal, the main contractor building HealthCare.gov, to demonstrate a simple feature called Account Lite, intended to let consumers create accounts before enrollment began. CGI was behind schedule and, when it finally did the demonstration, federal workers found 105 defects.
●On Sept. 26, five days before the launch, CMS officials discovered that the website had capacity for just a fraction of the planned number of consumers who could shop for health plans and fill out applications. That afternoon, CMS officials drove to the Laurel, Md., offices of a contractor, Terremark, and ordered its managers to double the capacity within 72 hours.
●Another contractor, QSSI, which was building the system for consumers to create accounts and verify their identities, underestimated the capacity required because its leaders did not know that consumers would not be able to browse health plans unless they first created an account. Just after midnight on Oct. 1, when HealthCare.gov began to run, QSSI’s staff members were in their office, watching as “everything was turning red on our screens,” indicating that people couldn’t get onto the site, the report says.
Before the site opened, CMS had not tested it end to end to see how the parts worked together. “You can’t test what is not built,” a contractor told the investigators.
Such last-minute chaos stemmed from decisions and dynamics that had begun much earlier, the investigators said. The ACA provided HHS with $1 billion for the administrative expenses of implementing the law, but the department “ceded over half these funds” to the Internal Revenue Service and other agencies carrying out parts of the law, aggravating its own financial strain.
And delays occurred, in part, because of close scrutiny of the CMS’s work by the White House staff, even on relatively minor issues. CMS employees were frustrated, the report says, “with the discussion around changing the term ‘nationwide health insurance’ to “health insurance’ in official documents.”
Work was hampered, too, by turnover of key staff at the CMS Center for Consumer Information and Insurance Oversight, which oversees the marketplace.
As the launch date neared, the report says, CMS officials and workers became “desensitized to bad news about progress,” doing little to respond to warnings and remaining too optimistic.
By the next spring, that had changed. On April 1, 2014, the day after the first enrollment season ended, the agency’s leaders met for three days of “ruthless prioritization” for the second sign-up period that fall. They listed the unfinished work on the website and, after considering what each item would require, cut the list in half.
Even today, after 9.6 million people nationwide signed up during the third enrollment for ACA coverage, HealthCare.gov “faces ongoing challenges,” the report says, including the completion of the website. One last part is an automated payment system with insurers. CMS began to use the system last month, starting with insurers whose own IT systems were ready for it.
Related: Timeline of HealthCare.gov launch