CGI catching heat for health exchange glitches

Fairly or unfairly, CGI Federal is getting pinged in the many reports about the problems with the launch of the health insurance exchanges on Oct. 1.

There have been well-publicized problems with the long wait times and other glitches involving the exchanges that are at the heart of the Affordable Care Act.

CGI is in the spotlight because it won the contract in 2011 to build the exchanges for the Centers for Medicare and Medicaid. The contract was for five years and was worth $93.7 million.

Quality Software Services, formerly a small business but now owned by UnitedHealth, won a $55 million contract to for a data hub to exchange information with government to verify an applicant’s income and citizenship, according to the New York Times.

The Washington Post used the problems with the exchanges as an example of what’s wrong with federal IT policies.

It is an interesting read and highlights the need for more flexibility in the procurement system, which the Post story argues stifles innovation but rewards companies that become experts at navigating the procurement system.

I think the health exchanges suffered as much from a high-profile launch that forced the system to go from 0 to 60 with the flick of a switch as it did from problems with the procurement system.

It is important to remember how complicated the exchanges are, and how many other systems it must interact with, including Social Security, Homeland Security, IRS and, of course, private insurance companies.

Couple the complexity with what the government says is higher-than-expected volume, and you are bound to have problems.

CGI has been quiet, declining to comment so far. I’m sure it is hard to mount a defense against the criticism that doesn’t sound clichéd or self-serving.

CGI, QSS and other contractors also have had their heads down, working to add servers and processing power to the exchanges as well fixing software glitches, according to published reports.

Once the air clears, it’ll be interesting to see what the lessons learned from a technology, planning and management perspective are.