The federal government’s Obamacare enrollment system has cost about $2.1 billion so far, according to a Bloomberg Government analysis of contracts related to the project.
Spending for HealthCare.gov and related programs, including at the Internal Revenue Service and other federal agencies, exceeds cost estimates provided by the Obama administration, the analysis found. The government’s most recent estimate, limited to spending on computer systems by the agency that runs the site, through February, is $834 million.
HealthCare.gov and its associated programs are the main portal for millions of Americans to sign up for coverage under the Patient Protection and Affordable Care Act (PPACA) also known as Obamacare. Spending for the system has been a matter of dispute between the administration and Republican opponents in Congress, who have tried to block funding for the law.
“The way in which Obamacare has been rolled out has been very messy,” with spending scattered across dozens of contracts, many of them predating the law and amended afterward, said Peter Gosselin, a senior health care analyst at BGov and lead author of the study. “One of the reasons it has been implemented in the way it has been, financially, is precisely to deny opponents of the law a clear target.”
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The construction of HealthCare.gov involved 60 companies, supervised by employees of the Centers for Medicare and Medicaid Services (CMS) instead of a lead contractor, according to the inspector general at the Health and Human Services Department (HHS). The project was marked by infighting among the contractors, CMS officials and top officials at HHS, the Cabinet-level department that oversees CMS, according to e-mails released Sept. 17 by the House Oversight and Government Reform Committee.
Aaron Albright, a spokesman for CMS, disputed BGov’s calculation, which included parts of the federal health insurance system other than its computer elements.
“The GAO [Government Accountability Office], HHS’s Inspector General and the department all measured the cost of marketplace-related IT contracts for HealthCare.gov,” Albright said in an e-mail. “But this report measures different things, and not surprisingly, produces a different number.”
Albright added that PPACA had saved consumers about $9 billion in health care costs so far.
“CMS takes its responsibility for spending taxpayer dollars seriously,” he said. “That’s why we’ve moved aggressively to implement extensive contracting reforms, bringing in new leadership to oversee marketplace operations, hiring a systems integrator, and ending our largest contract with CGI and moving to a new type of contract with Accenture that rewards performance.”
Earlier this year, CMS fired the original contractor for HealthCare.gov, CGI Group Inc. of Montreal, and hired Accenture Plc for the project. A UnitedHealth Group Inc. executive, Andy Slavitt, who had managed repairs of the site, was hired as the principal deputy administrator at CMS. Kevin Counihan, the former chief executive officer of Connecticut’s successful state-run insurance exchange, was hired Aug. 26 to manage HealthCare.gov.
The Medicare agency and independent auditors have had trouble tracking the costs of PPACA programs. The GAO, a congressional agency, said in a Sept. 22 report that it was “difficult and time consuming” to obtain financial information for the Center for Consumer Information and Insurance Oversight (CCIIO), the CMS office that manages many PPACA programs, and that it “could not determine the reliability of most of the amounts” CMS provided.