What Should Have Happened with Cover Oregon

By now, people around the country know our state’s attempt to create a health insurance exchange website was a colossal failure. Fingers of blame are pointing in all different directions; and last month the U.S. Attorney’s office issued broad subpoenas seeking information from Cover Oregon and the Oregon Health Authority about who did what, who knew what, and when.

On May 29 Governor John Kitzhaber spoke at a legislative committee hearing to announce that he blamed the prime website contractor, Oracle Corporation, for failing to deliver a working website. He asked Oregon’s Attorney General to consider suing Oracle to “get our money back.” Of course, the money he’s talking about isn’t really “our money” because we got it from the federal government. And, that same federal government is considering whether to ask Oregon for “its money” back as well.

Later in that same hearing, Oregon’s new Chief Information Officer made an interesting observation.* Alex Pettit wasn’t here when Cover Oregon began its long march toward failure in 2011. Legislators asked him if anything would have been different if he had been overseeing Oregon’s IT projects back when the ObamaCare state exchanges were being born.

Mr. Pettit discussed how he viewed such big IT projects, how he evaluated them, and how he decided if they should proceed or not. He noted that, as Governor Kitzhaber and others have admitted, Cover Oregon was a very ambitious project with a very broad scope. Pettit said that to be successful, such projects must instead have a narrow scope.

He explained that since he came to Oregon in January, he has acted to slow down other big projects until they met his criteria, even though they might be priorities of the Governor as Cover Oregon was. He then explained that in 2011 he was the Chief Information Officer in the state of Oklahoma when it applied for and received a $134 million federal grant to build that state’s health insurance exchange.

Pettit noted that his team evaluated the proposal for the Oklahoma exchange and they decided that “We did not have the capacity to do this.” And so, as he told Oregon legislators, they “sent the money back.”

If Oregon officials had made a similar decision in 2011, we wouldn’t be where we are today, having spent some quarter billion tax dollars on a project that caused nearly everyone involved nothing but grief and heartache. In the future, let’s hope that we follow Mr. Pettit’s advice when he or his successors determine that we should simply “send the money back” or, better yet, not ask for it in the first place.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

* Audio of the entire Joint Committee On Legislative Audits, Information Management and Technology (5-29-14) hearing is here:http://www.leg.state.or.us/listn/archive/archive.2013i/JLAIMT-201405291400.ram

The questions leading to Mr. Pettit’s answer about what happened in Oklahoma begin at about 1:48, and his answers run to about 1:55.

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