Governor Seeks Lawsuit Over Health Exchange Website Debacle
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[May 31, 2014]
By Shelby Sebens
PORTLAND Ore. (Reuters) - Oregon's
Democratic governor wants the state's attorney general to sue the
technology vendor that developed the embattled Cover Oregon website to
recover payments, while officials from Oracle said on Friday any claims
A state that fully embraced the Affordable Care Act, Oregon
endured one of the rockiest rollouts of President Barack Obama's
healthcare law, requiring tens of thousands of applicants to use
paper forms since launching on Oct. 1. The state decided in April to
move the troubled state exchange to the federal system.
The announcement by Governor John Kitzhaber seeking legal action
comes as federal prosecutors have subpoenaed documents from Oregon's
health exchange agency as part of a grand jury investigation into
how the state used federal money to set up the now-failed health
"The time has come to hold Oracle accountable for its failure to
deliver technology that worked on the timelines the company
committed to," Kitzhaber said in a statement on Thursday. "Today I
have asked Oregon Attorney General Ellen Rosenblum to immediately
initiate legal action to recover payments and other damages from
"Oracle did not deliver," Kitzhaber said. "The poor quality of its
work is obvious in the many bugs that are still not fixed, in missed
deadlines (and) in the fundamental flaws in the systemís
Oracle Corp., which the state paid about $134 million, defended its
work and called Kitzhaberís move political.
"OHA and Cover Oregon were in charge and badly mismanaged the
project by consistently failing to deliver requirements in a timely
manner and failing to staff the project with skilled personnel,"
company officials said in a statement.
"We understand the political nature of the announcement just made
and that the governor wants to shift blame from where it belongs. We
look forward to an investigation that we are confident will
completely exonerate Oracle."
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Several Cover Oregon officials, including two past directors, have
resigned in recent months amid an independent investigation ordered
by the governor's office that found mismanagement and a failure to
report problems from the start.
The state has received roughly $300 million in federal grants and
paid Oracle to create technology for the website.
Federal prosecutors have also asked for all purchase orders,
invoicing and statements of work by Oracle. Rosenblumís office
released a letter sent to Kitzhaber saying her office was exploring
"I share your determination to recover every dollar to which Oregon
is entitled," Rosenblum said.
Kitzhaber, who is up for re-election in November against Republican
challenger Dennis Richardson, also made requests to the Inspector
General of the U.S. Department of Health and Human Services to
evaluate Oracle's work and to "consider the full range of legal
(Editing by Cynthia Johnston and Chris Reese)
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