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 Terremark's contract with the Department of Health and Human
Services was due to expire on March 30, the day before the end of
open enrollment for 2014, a time when high daily volumes are
expected as consumers from 36 states rush to use to website to sign
up for subsidized private health insurance. It would be extended for
up to seven months, according to federal documents.
Hewlett-Packard Co has been named to replace Terremark as website
host and operator of the department's federal data center as part of
Obama's Patient Protection and Affordable Care Act.
"We extended Terremark's contract term in order to ensure a
successful transition between the two contractors," said a statement
issued by the Centers for Medicare and Medicaid Services, the
Obamacare agency at HHS.
"HP and Terremark will work together so that the site runs smoothly
for consumers during the remaining weeks of open enrollment," the
statement said.
Terremark's replacement by HP came to light after the botched
October 1 rollout of HealthCare.gov. The website was overwhelmed by
technical problems for much of October and November.
Terremark's data center also experienced outages across the system
that affected not only HealthCare.gov but also 14 healthcare
exchanges run by individual states.
However, CMS had awarded the contract to HP several months before
the launch.
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The administration mounted an emergency operation to fix the site
that has allowed enrollment to proceed relatively smoothly since
early December. More than 4 million people have signed up for
private health coverage through the federal and state marketplaces.
Terremark received $55.4 million under the original Obamacare
marketplace contract, which was awarded in 2011. Federal documents
said the new seven-month extension, valued at $58 million, includes
a four-month base period and 30-day option periods.
(Reporting by David Morgan; editing by Mohammad Zargham)
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