State officials determined that additional fixes to the Cover Oregon homepage would cost an additional $78 million. The state of Oregon had initially paid software developer Oracle [NASDAQ- ORCL] to develop the Covered Oregon website while Covered Oregon paid another $3 million for TV, radio and internet marketing that played up Oregon's hipster image.
Cover Oregon received a month-long enrollment deadline extension because of multiple technical glitches in its system.
But fixing the existing system, Cover Oregon officials say, would have meant pouring another $78 million into the growing money pit. Switching to the federal system significantly reduces the cost to around $5 million.
It is still unclear how the state might be able to recoup its exchange funding -- if at all. Cover Oregon was partially financed by a 2.5 percent premium tax on insurers selling the exchange, Cover Oregon technology chief Alex Petit said Thursday.
Petit says he’ll meet with federal health officials early next week to iron out all of the financial details.
Oregon’s exchange, which was touted by the Obama administration in the beginning as a success story, quickly proved otherwise. It was widely seen as the worst of more than a dozen states that developed their own online health insurance marketplaces.
The federal Government Accountability Office has announced an investigation into Oregon's exchange, including looking at whether the federal government can reclaim grant money given to Cover Oregon if taxpayer funds were mismanaged.
While the Obama Administration did a touchdown dance earlier this month over the figure of 7.1 million enrolled in 0bamacare, the President's signature law has suffered a number of setbacks on both the federal level as well as states where 0bamacare received support from state and local officials. Towards the end of 2013, Colorado's state-run 0bamacare exchange failed to meet even half of it's worst-case scenario projections for enrollments. The state of Hawaii spent $120 million to create the Hawaii Health Connector website that only 4300 people enrolled in- averaging more than $28,000 per enrollee.
At the Department of Health and Human Services, embattled director Kathleen Sebelius submitted her resignation shortly after the administration began touting the 7.1 million enrollees number.