Obamacare Website Costs Top $1 Billion

Tyler Durden's picture

Although the GAO has made clear the limitations of its data, its $394 million tally for work through March 31 has been widely cited as the price tag for the entire launch of the "Affordable" Care Act. However, as Bloomberg's Peter Gosselin finds, looking at the full range of ACA-related contracts for just 10 firms, more than $1 billion worth of contract awards. Perhaps even more mind-blowing is that more than one third of the funds going to the top contractors working on the federal exchanges were awarded in the last six months - even as it was clear the project was failing.

 

As Bloomberg's Peter Gosselin notes,

In a typical IT project, spending ramps up to a peak, then trails off during the final phase.

This was not the case for the Obamacare websites,

The torrent of late spending — almost $352 million of $1 billion in awards to the top 10 contractors — indicates the magnitude of the work still to be done as opening day approached, and helps explain the information technology problems that have dogged the exchange system since its launch.

So, the government throws more taxpayer money at it...

In aggregate, the 10 firms won a third of their health law-related contract dollars in the six months ended Sept. 30.

 

Besides showing the rush to issue contract awards in the months leading up to the opening of exchanges, the BGOV analysis also revealed that the implementation of the health law is costing substantially more than generally is portrayed.

 

Although the GAO made clear that its study focused solely on the costs of implementing the federal exchanges and the data services hub, its $394 million tally for work through March 31 has been widely cited as the price tag for the entire launch of the law. But in looking at the full range of ACA-related contracts for just 10 firms, the BGOV analysis found more than $1 billion worth of contract awards.

 

And still they admit things are not going well...