Oregon withholds $25.6M from Oracle after health exchange website woes
Cover Oregon was supposed to go live Oct. 1 but still isn't fully functional
IDG News Service - Oregon is holding back $25.6 million in payments from Oracle over work the vendor did on the state's troubled health care exchange website.
Dubbed Cover Oregon, the website was built in connection with U.S. President Barack Obama's health care policy overhaul. It was supposed to go live on Oct. 1 but its launch has been marred by a slew of bugs and it is not yet fully functional.
This week, Cover Oregon said it had reached an agreement with Oracle laying out "an orderly transition of technology development services, and protects current and future Cover Oregon enrollees," according to a statement.
The pact will allow officials to keep enrolling state citizens in health care plans while project moves into its next phase, the statement added.
Cover Oregon is holding back $25.6 million out of some $69.5 million Oracle claims it is owed for project work. "Oracle will not use the disputed amount as a reason to stop providing services during this open enrollment period," according to this week's announcement.
The vendor will fix the site's issues under Cover Oregon's supervision. In addition, the state is reserving the right to sue Oracle as well as challenge payments it has already made.
Oregon officials reached the deal with Oracle after the company reportedly threatened to pull all of its workers off the project and essentially walk away.
The state plans to study its options, which include keeping the functionality that is working properly but signing a contract with a different systems integrator for subsequent phases. It's also possible Cover Oregon will use software developed for other state exchanges or Healthcare.gov, according to this week's announcement.
An Oracle spokeswoman declined comment Wednesday.
While the state has obtained a price reduction, it's not clear what more has been accomplished under the pact, according to analyst Michael Krigsman, CEO of consulting firm Asuret and an expert on the roots of IT project failure.
The state's announcement "does not indicate how the work has changed, to remove the obstacles that caused problems in the past," Krigsman said via email. "Unless something changes in the actual work or project management, then what will cause an improved result this time around?"
Much like the problems that cropped up with the national Healthcare.gov website, as well as a number of other state exchanges, Cover Oregon's difficulties have sparked a political firestorm, with Oregon lawmakers recently calling for a federal probe into the project.
Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com
- The Business Value of Continuous Delivery Download this whitepaper to learn more about the business value of Continuous Delivery and see why it could be a game changer for...
- Ten Factors Shaping the Future of Application Delivery Download this research report conducted by Enterprise Management Associates (EMA) to learn how those that are seeking to accelerate application delivery are leveraging...
- Adobe Creative Cloud FAQ The following are answers to common questions about Adobe® Creative Cloud™ for teams membership, purchasing, security, and storage.
- What's coming to Adobe Creative Cloud Editing and video content creation workflows are about to get easier and more exciting, with major updates coming soon to Creative Cloud, bringing...
- NSS Labs & Cisco Present: Evaluating Leading Breach Detection Systems Today's constantly evolving advanced malware and APTs can evade point-in-time defenses to penetrate networks. Security professionals must evolve their strategy in lockstep to...
- Will the Real Endpoint Threat Detection and Response Please Stand Up? This webinar explores new technologies & process for protecting endpoints from advanced attackers as well as the innovations that are pushing the envelope... All App Development White Papers | Webcasts