Editorial: Getting Out From Under the Cover Oregon Mess

Fixing Cover Oregon has been as hexed as the topsy-turvy year that preceded its spectacular non-start last fall.

by The Oregonian, McClatchy News Service / April 16, 2014

The Cover Oregon mess has triggered anger and bewilderment as Oregonians try to grasp what went so horribly wrong. Few express the sentiment better than OregonLive.com reader Harley Leiber, who posted the following comment beneath a recent story by The Oregonian's Nick Budnick:

I suppose I could say I got no dog in this fight as I have healthcare insurance. But I do. We all do. Every day I wait for the good word ... the news that the thing is fixed or fixable. What in the world have they built that it is such a colossal failure?

Good question. The scale of the state's failure in building its own online health insurance exchange is enormous and expensive – more than $200 million deep in federal grant money and still sputtering. Fixing Cover Oregon has been as hexed as the topsy-turvy year that preceded its spectacular non-start last fall. In January, for example, Cover Oregon staff estimated the number of stubborn bugs to be taken out of the computer-driven project was a scant and promising 13. But in recent weeks, the number was pegged at around 300, and a separate report by the exchange consultant Deloitte has estimated 500 more bugs "are lurking in the exchange that haven't been discovered yet," Budnick reported recently. It would cost many millions more to slay enough bugs and configure a workable, if incomplete, exchange by November, the deadline by which Oregon must have a system that allows insurance enrollments in one sitting.

Now the Portland-based corporate sharpshooter Clyde Hamstreet has been hired to help find a way out. That could mean fixing and building upon the Oracle-based system as designed so far, even though Oracle has been sent packing; or opting to use the federal insurance sign-up system, a simpler exchange offering Oregonians fewer options that would cost only $4 million to $6 million.

Hamstreet is a closer. He made headlines for taking Sunwest, the huge Salem-based nursing home chain in default, through restructuring to profitability. But in the case of Cover Oregon, for which Gov. John Kitzhaber personally tapped Hamstreet, the $300-an-hour consultant has a gun to his head: Hamstreet must figure things out within weeks if Oregon can realistically blaze a path that leads not to a mandatory November launch but to at least three months of successful testing before launching. That means an online exchange site for Oregonians must be working by August. Hamstreet figures he has four to six weeks to do his part.

In an interview with The Oregonian's editorial board, Hamstreet said his immediate task is to x-ray Cover Oregon as an organization (are Cover Oregon's employees properly deployed?) while also taking into account the big picture (is Cover Oregon's IT configuration to be trusted?). Separately, a 16-member technology committee must continue to assess the task of righting the online site and make known its findings to Cover Oregon's board of directors and to Hamstreet, whose first preoccupation is money.

"I've got to figure out how much money comes in and goes out," Hamstreet said, "because money drives everything – even in government." Owing in part to lower-than-expected private insurance enrollments through Cover Oregon so far, the agency must cut its budget by about 20 percent, The Oregonian's Jeff Manning has reported. In just three days on the job, Hamstreet terminated the contract of Deloitte, which has been paid $7.65 million so far, Manning reported.

Harley Leiber was right in suggesting all Oregonians have a dog in this fight. The price of failure is breathtaking and demands a sane way forward: A wrong choice will cost many more millions, deliver to Oregonians thousands more headaches and further undercut the public's belief that government can responsibly undertake big projects.

Going forward, Hamstreet and Cover Oregon's board of directors must be ruthless in distinguishing between wishes and data-driven, reliably projected outcomes. Tryouts are over.

©2014 The Oregonian (Portland, Ore.)