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By Steve Kelman

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What's happening with Obamacare?

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I have just returned from a month in Sweden, during which I have been following--albeit incompletely and at a distance--the issues surrounding the difficult rollout of the website and the more recent stories about people losing insurance coverage because their existing plans don't meet the minimum standards of the 2010 overhaul.

I try to keep partisan politics out of this blog, but both of these fiascos seem to me to illustrate the problems that can arise when political leaders (or their advisors) fail to think sufficiently about management and implementation issues involved in government programs.

As I understand it from the limited accounts I have seen, there were a number of warnings before the website was launched that it had not been sufficiently tested and that launching it was very high risk. (As a sidebar, it should be noted that people who asked why it should be so complicated or expensive for the government to "put up a website" misunderstand what had to do – link hundreds of technologically diverse databases from different insurance providers and government organizations, quite a complex task. This was nothing like some startup company establishing a webpage to tell customers about what the company does.)

The question is whether and when President Barack Obama or his senior staff were informed of these problems. If they were not, why not? If they were, did they make a conscious decision to take the risk and let the site go live on the original date, comparing the risks of various courses in light of the politically charged debate about Obamacare? If Obama knew the risks, and if he explicitly decided they were worth taking, then the Oct. 1 launch was defensible, though probably in retrospect a bad decision. (When you take a risk, it is possible to have what decision theorists call "good decision, bad outcome.") Otherwise, though, what happened reflects the president's failure to sufficiently consider management issues with the execution of the program.

The problems that have arisen about cancelled plans, given that Obama promised during the debate over the law that anyone who was happy with their current plan could keep it, seems – unless there is something relevant that I haven't seen – to be a clear case of not paying enough attention in a timely way to implementation issues for new legislation. It would seem that if the bill contained minimum standards for health insurance plans, there was a very high probability that some, or even many, existing plans might not meet the minimum standards; indeed, if every plan met the standards, why bother to legislate it?

Given that some plans would not meet the standards, it is also a wise assumption that some insurance companies would choose to cancel plans not meeting the standards, rather than upgrading the coverage, and that this would mean some people would lose existing coverage. Here, it seems as if there was a failure to think through implementation issues in the legislation. The result is last week's fiasco number two for Obamacare.

The lesson for all politicians: You ignore management and implementation at your peril.

As I said, I've been away for a month. Have I missed something here?

Posted on Nov 05, 2013 at 9:41 AM

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Reader comments

Fri, Nov 8, 2013

Steve, Some things you didn't say: First, the problems are not surprising given that two political appointees (Sibelius and Tavenner) were in charge, neither of which has had experience with a large IT development project (to the best of my knowledge). Second, major IT projects stumble or fall in both government and the private sector (see Ewusi-Mensuh, Software Development Failures, MIT Press 2003, which describes several examples) -- this was not unique to government. Third, the agency's contract strategy -- giving pieces of the project to 55 contractors instead of making one firm responsible for the whole thing -- was stupid and made everything more difficult. (I'm sure that HHS and CMS can give all sorts of reasons why this was necessary. Finally, the political environment caused the administration to rush the project and then yielded a lot more squawking than was warranted.

Thu, Nov 7, 2013 Al

It sounds like no one wanted to give the boss bad news. In this case, the bad news was "Your idea is a disaster waiting to happen- don't sign it into law". The problems with the web site are nothing- I'm much more worried about the other effects.

Wed, Nov 6, 2013

When did congress vote to (& pass) changes to the Law that the president is talking about?

Wed, Nov 6, 2013

Those that voted for it should be forced to pay 100% of it. Those that were smart enough to not vote in support of it should pay zero % of it!!! This is like buying a brand new Jaugar and making the neighbor pay for 110% of it.

Wed, Nov 6, 2013 Frank Verity Pittsburgh, PA

In answer to your question, here's what you're missing. Health care plans that are *better* than the "minimum standard" are being canceled, too. Why? As the president said yesterday, “If you had or have one of these plans before the Affordable Care Act came into law, and you really like that plan, what we said was, you could keep it, if it hasn’t changed since the law’s passed.” What plan will *never* have a change? E.g., a premium increase? Virtually all plans are affected, not just "substandard" plans. What the president promised (up until yesterday) was “If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you’ll be able to keep your health care plan, period. No one will take it away, no matter what.” No caveats about substandard plans or changes to existing plans. Many Americans believed the president and voted for him on the basis of this promise. NBC reported recently that HHS knew this promise was false. The president also said the average family of four would save $2500 a year under ACA. This is also false. Yesterday's restatement of the election year promise is still false. And all of these broken promises and falsehoods obscure the key question that Americans should be asking, which is why the president should be allowed to decide if we get to keep our plan or not? Why do we want this or any president to decide what health care plan we are allowed to have? The project (mis)management of is sad, typical, and largely beside the real point. Americans have lost their freedom to choose their own health care, and to correct that, the ACA needs to be repealed.

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