Consultants at First Data say management fragmentation and over-use of temporary workers hurt Oregon's public health insurance exchange.
Oregon's state-based Cover Oregon started with enthusiastic support from its state, and $464 million in state and federal funding. It has helped 49,500 residents sign up for "qualified health plan" (QHP) coverage.
But the state has never gotten its Web-based enrollment system or automated application processing systems to work. The exchange has had to process applications by hand.
Oregon Gov. John Kitzhaber, D, released a First Data report on the Cover Oregon information technology problems this week at a press conference in Salem, Ore.
Kitzhaber said he has taken steps to get past the problems, including accepting the resignation of Dr. Bruce Goldberg, the director of the Oregon Health Authority and acting director of Cover Oregon.
Kitzhaber said he is asking the state's attorney general to "consider the full range of legal avenues and options" for dealing with Oracle -- the primary exchange website development vendor -- and other exchange IT vendors.
Representatives from Oracle were not immediately available to comment on the report.
The First Data consultants say exchange IT work ran into problems because the state let too many entities share responsibility for the project and failed to be clear about who was in charge.
The Cover Oregon board, Cover Oregon managers, the Oregon Health Authority, the state Department of Human Services, Oracle, a quality assurance vendor and other vendors all helped run the project, the consultants say.
"A common theme from the assessment interviews was that there was no single point of authority on the project," the consultants say.
A quality assurance vendor reported in October 2012 that the governance structure described in the project charter did not seem to be working, and that it was not clear how the project team was making its decisions, the consultants say.
The consultants say the project team had trouble hanging on to IT workers who understood the project because managers filled too many positions with temps.
Temporary positions "are difficult to fill due to their lack of employment security," the consultants say.
The workers who do take the temporary jobs continue to look for permanent positions, the consultants add.
The consultants say the state would be better off hiring permanent workers for the technologies that will be used in the future and to use the temps to run the systems that will be replaced.