As we noted last month, President Obama sat down for an interview with Chuck Todd on November 7 and said:
You know, one of the lessons — learned from this whole process on the website — is that probably the biggest gap between the private sector and the federal government is when it comes to I.T. … Well, the reason is is that when it comes to my campaign, I’m not constrained by a bunch of federal procurement rules, right? …When we buy I.T. services generally, it is so bureaucratic and so cumbersome that a whole bunch of it doesn’t work or it ends up being way over cost.
Well, this week we learned that the gap’s been closed. The Department of Health and Human Services (HHS) told us so. In its official, December 1 “Progress and Performance Report” on the Obamacare website, HHS not only announced that it had “met the goal of having a system that will work smoothly for the vast majority of users,” but wrote that “the team is operating with private sector velocity and effectiveness.” That sure was quick.
Sarcasm aside, we found it hard to read HHS’s eight page document without cringing. Needless to say, it’s not a genuine “progress and performance” report. It’s not even close.
Consider that shortly after accepting his position as website czar in October, Jeffrey Zientz let us know that he’s working from a list of problems on a “punch list,” which included over 100 issues according to an anonymous spokesperson. Zientz added that the system’s failure to deliver accurate reports to insurance companies was at the top of the list. This seems a reasonable prioritization, right? If the exchange can’t deliver the necessary information to insurance companies, the whole process collapses. But HHS’s report doesn’t even mention this critical problem.
And how about measures to protect website users’ personal information, which are widely reported to be full of holes? Again, not a word.
You won’t find expense figures, either, which is unfortunate in light of Bloomberg’s analysis showing that the largest 10 contractors were already paid an astounding $1 billion. Considering the administration’s private sector aspirations, the absence of any information on the website’s soaring costs seems a conspicuous omission.
Instead of checking off accomplishments against what still needs fixing, while revealing the taxpayers’ bill, HHS’s report combines vacuous “achievements” such as “2X a day standup war room meetings” with unverifiable statistics for response times, capacity, error rates, uptime and software fixes. The report reads like a baseball team’s declaration of success on its spring training goals of learning each others’ names, knowing which base is which and memorizing the infield fly rule. We don’t doubt there’s been some improvement in the metrics, but it’s unlikely that the last two months’ progress gets the website to much better than inadequate, from its earlier status of epically inadequate.
Worse still, HHS seems to think we take their propaganda seriously. Displaying #AskJPM-like ignorance of how the administration is perceived, they act as if we believe what we’re told. On the contrary, there seems only a shrinking minority of loyalists who still trust the official narratives, as shown by Obama’s plummeting approval ratings. Those who weren’t predisposed to disbelieve empty rhetoric probably tuned out at “you can keep your plan if you like it.”
And while we may never know the true extent of the administration’s deceptions, here are a few links to information that Zientz doesn’t want you to have:
- CNN reports that “the White House is exerting massive pressure on the industry, including the trade associations to keep quiet … insurance executive feel defenseless against the White House PR team … the insurance companies are in a position to just be quiet for fear of offending basically their biggest source of income.”
- In one of what we suspect are multiple methods of inflating its enrollment counts, HHS flouts industry standards by including “enrollees” who didn’t complete the process by continuing to the payment step. This detail is, of course, absent from official reports. (It was shared with the Washington Post by anonymous sources.)
- Prior to and immediately after the website’s October 1 launch, HHS head Karen Sebelius kept a close wrap on all sorts of critical information, including the website’s developmental progress, initial effectiveness, the true reasons for its early breakdowns, and expenses (which were only revealed through Bloomberg’s analysis linked above and other third-party estimates).
Getting back to the administration’s claim to have closed the gap between public and private sector effectiveness, here are relevant links to a few articles about the key players involved:
- The firm that was awarded the new general contractor role for the website, QSSI, was quietly purchased (no press releases were issued) in 2012 by our largest health insurance firm, UnitedHealth Group. This occurred not long after a top HHS health care regulator took a new position at the UnitedHealth subsidiary that acquired QSSI. As you might expect, it triggered congressional inquiries about the glaring conflicts of interest, which changed nothing.
- QSSI was granted its enlarged role despite complicity in the website’s launch disaster and serious questions about its ability to protect sensitive data, as demonstrated by an HHS Inspector General audit earlier this year.
- UnitedHealth Executive Vice President Andrew Welters and his family are big-time donors and fundraisers for Obama, with OpenSecrets.org reporting amounts of between $500,000 and $1,000,000. Welter’s wife was rewarded with a plush ambassadorship to Trinidad and Tobago. Maybe we can fill in the blanks on Welters’ reward.
- White House visitor logs show a series of appearances in recent years by Toni Townes-Whitley, a senior executive at CGI Federal, the firm with the largest website contract until QSSI’s recent mandate. These visits were both professional and personal, weekday and weekend, and one of them included a photo with the Obama’s at a Christmas gathering. The professional visits were surely related to CGI Federal’s government business and included a meeting with the principal deputy Obamacare commissioner. The personal visits were explained by Townes-Whitley and Michelle Obama being old college friends, having graduated from Princeton in the same year with involvement in the same extra-curricular groups.
- Among many recent reports of CGI Federal’s shortcomings, Newsweek published an article that includes details of “potentially aggressive bookkeeping,” “weak disclosure practices,” a whistleblower suit alleging violations of SEC fraud rules, and botched government contracts in its AMS unit.
- In the bigger picture of all outsourced Obamacare contracts, the Sunlight foundation showed that the disastrous launch may be explained by the fact that the work was divvied up among 47 contractors, all but one of which was known to the government through past mandates. Disclosures by 17 of those contractors reveal that their lobbying expenses in 2011 and 2012 totaled $128 million.
Reviewing these facts, I suppose HHS could support their claim to “private sector velocity and effectiveness” with some semantic tricks. If you interpret that phrase as referring to the principle contractors’ adeptness at winning huge, no-bid contracts through personal connections, donations, fund raising and lobbying, then it all adds up.
For more on Obamacare, in October we discussed a few of the law’s unintended consequences, which are far more important in the long-term than the technology side covered above.