Award for healthcare.gov increased $100 million in last year
Federal and state officials had warned the healthcare.gov site and technology powering it might not be ready to be launched. As early as March this year, Henry Chao, the chief digital architect of the site, expressed his worries of what the site rollout would be like come Oct. 1, according to a New York Times article.
Around that same time, more money started being assigned to the delivery order contract by CGI Federal, the company responsible for creating the insurance marketplace website.
Since April, more than $100 million have been added to the award, with the most recent addition of $18.2 million awarded Sept. 19, less than two weeks before the site launched.
According to federal documents, the original delivery order looked like it was going to be a roughly $93 million deal when it was first awarded in 2011; the initial cost was $55.7 million and the base and options value was $93.7 million.
By August 2012, CGI Federal was already approaching that amount.
Currently, the ceiling value of the contract is $292 million, and the total spending is up to $196 million, according to government records.
“We can’t be sure what the actual budget for this project is,” said Scott Amey, general counsel at the Project on Government Oversight. “They could have exceeded the budget already or the budget is actually $500 million, and they’re performing under budget.”
Federal records show the original contract with CGI was an indefinite delivery/indefinite quantity contract, established first in 2007. These types of contracts are flexible in that they allow for the contract to increase and evolve without the need to re-bid on it.
“It raises questions on contract oversight, especially with a project of this scale to keep increasing as much as it has, considering how many people were involved in the planning and delivery,” Amey said. “These are taxpayer dollars we’re dealing with.”
The contract costs cover everything from software for the site to salaries of those working on the site.
The final price tag of healthcare.gov isn’t entirely certain, nor is the timeline for fixing the site’s problems. However, an 11-hour multimillion-dollar increase in funding suggests the level of last-minute work to be done.
The Health and Human Services Department didn’t respond to requests for comment.