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Obama Administration Fails to Answer Questions on True Cost of Implementing Obamacare

Contracts for the two main contractors responsible for have more than doubled since being originally awarded in September 2011

WASHINGTON, D.C. – The U.S. Department of Health and Human Services (HHS) has failed to provide straightforward answers to questions about the costs of implementing the Affordable Care Act (ACA) health insurance Exchange. Seven weeks after U.S. Senator Jerry Moran (R-Kan.) – Ranking Member of the Senate Appropriations Subcommittee on Labor, Health and Human Services and Education – sought answers from HHS on the cost of the failed Obamacare roll out, the Department responded with vague and incomplete answers to appropriate questions including how much the President’s “tech surge” is costing taxpayers and whether the website was adequately tested before it was rolled out.

“Without approval from the Appropriations Committee, HHS continues to spend more taxpayer dollars on Obamacare implementation. In doing so, HHS has increased contract awards to the very contractors HHS themselves blamed for the dysfunctional website,” Sen. Moran said. “Problem solving and a functional government requires understanding, accountability and  inter-branch cooperation. The Department’s long overdue and completely lacking responses to Congressional inquiry undermine both. HHS must provide Congressional committees of jurisdiction adequate information about the costs of ACA delays, federal Exchange implementation, and the ongoing technical ‘glitches’. With so much as stake, Congressional oversight and cooperation from the executive branch is needed to address the Obamacare chaos at HHS.”

In HHS’ response to Sen. Moran’s questions, it was revealed that:

  • HHS has obligated $677 million for the federal Exchange infrastructure through October 31, 2013; 
  • Contracts for the two main contractors responsible for the failed website have more than doubled since being originally awarded in September 2011. HHS refused to state why the contractors were selected in the first place, what their qualifications are, and what specific projects they are responsible for;
    • Quality Software Services Inc. (QSSI), which built the Data Services Hub, has had its contract increased from $30 million to $84.5 million; and
    • CGI Federal, which helped build and continues to support the IT systems of the Federally-facilitated marketplaces, has had its original $56 million contract increased to $197 million.
  • HHS will not hold the contractors responsible for developing a non-workable product because the government “is obligated to pay the contractor their allowable incurred costs plus a fixed fee;”
  • HHS refuses to specify the cost breakout for fixing the technical issues associated with the Exchanges; and
  • HHS refuses to outline the specific steps taken to test the website prior to the roll-out on October 1, and instead simply states that the system was tested for functionality.

Click below to read HHS’ full response to Sen. Moran’s questions.

Click here to read Sen. Moran’s original October 24th letter to Sec. Sebelius.


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