As someone who has been in the business of helping other businesses find the right software for the last 14 years, watching the federal online health insurance exchange disaster unfold begs the question – how does this stack up against other software purchase disasters?
There have been some real doozies over the years, so unfortunately, there’s no shortage of competition. Thomas Wailgum of CIO Magazine has documented several of those disasters, and Tom Salonek of Intertech has recounted others. The primary measures they and others have used to assess the extent of the failure have been total dollars spent/wasted, total number of people impacted, and the severity of that impact.
I would put the technology component of the Affordable Care Act in serious contention for worst software purchase ever for the following five reasons:
- The final price tag of the system itself is not yet known, but as reported in the New York Times it is already in the hundreds of millions of dollars. That’s a lot of money to waste, especially when we’re talking about tax dollars. It’s bad enough for a business to waste the money of its private shareholders. It’s much worse when it’s wasting the money of American tax payers.
- Major glitches have riddled the software and website for the first three weeks and made it almost impossible for citizens to enroll and for insurance providers to handle even the tiny amount who have. Technology experts familiar with the implementation and infrastructure, including former Federal Government CIO, Vivek Kundra, and Salesforce CEO (and Obama supporter), Marc Benioff, claim that much of the technology Healthcare.gov uses is outdated and inefficient.
- As reported in the Washington Examiner, there has been a complete lack of transparency behind the bidding and selection process of CGI Federal. Why were they selected? How did they explain their past, similar failures in a satisfactory way? How were the budget and scope of the project developed? This sort of documentation should be freely available to the public.
- The website is performing so poorly that the government invented fictional testimonials. For example, it turns out that Chad Henderson, who was promoted as one of the early adopters and able to overcome the glitches to buy insurance, did not actually, in fact, buy insurance. He was, however, a paid activist for Obama’s political advocacy organization.
- Most damning of all, the technology purchase and construction of Healthcare.gov was not even necessary. As Jeffrey Young of the Huffington Post points out, there are plenty of other solutions already in play. For example, eHealthInsurance.com is a perfectly functional healthcare insurance exchange that has been providing health insurance choices for the uninsured since the late 1990s. It works in all 50 states and the District of Columbia. And they are not the only one. If the government decided all books should be freely accessible, would they really create their very own competing website to Amazon.com? Why nationalize an industry instead of utilizing existing channels that are already working?
None of this should be a surprise to anyone. When you combine a large IT project with hundreds of millions of dollars and government bureaucracy, disaster is lurking around the corner. How much more tax payer money will we spend to salvage this, and, assuming it does ever get fixed, how long will the insurance exchange even last?
At least when companies make mistakes like healthcare.gov, they eventually shut them down. Other than our national parks and veterans memorials of late, does our government ever shut anything down? Let’s hope so.
Was this the worst software purchase ever? The jury is still out, but with close to a billion dollars already spent and tens of millions of Americans affected, it’s not looking good.
Looking for software? Check out Capterra's list of the best software solutions.