Obamacare-Linked IT Firm Given More Government Deals

Tuesday, 05 Nov 2013 04:49 PM

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The IT company chiefly to blame for the error-plagued Obamacare exchange website has recently been awarded several more lucrative government contracts, FoxNews.com reported Tuesday.

While embattled CGI Federal Inc. scrambles to fix the website's glitches after the disastrous Oct. 1 rollout, government officials have signed at least five different contracts with the company.

On Oct. 19, CGI signed an agreement with the Commerce Dept. for $266,164, to provide "IT and Telecom Systems Development" for the Patent Office, FoxNews.com reported.

But CGI officials say the signing of the contract is a technicality and it is actually an extension of an existing contract with the Commerce Dept.

Critics, however, have slammed the government for continuing to work with CGI Federal.

"This is a typical example of government creating perverse incentives," George Mason University economics professor Donald Boudreaux told FoxNews.com. “Unlike, say, a private homeowner who fires a contractor who does a poor job, the government rewards such poorly performing contractors with new work at lucrative rates."

CGI Federal was paid $290 million for its work in creating the HealthCare.gov exchange, and it was the one contractor that administration officials said failed to meet some expectations.

"We’ve had some issues with timely delivery," Marilyn Tavenner, head of the Centers for Medicare and Medicaid Services, acknowledged in testimony to Congress last week.

Criticism of the contracts spans both sides of the political aisle.

"I think it's a problem," said Alice Chen, who supports Obamacare and is executive director of Doctors for America. "I think you'd be hard-pressed to find someone who doesn’t."

Health policy experts also criticized the contracts.

"CGI Federal has no real skill set, and a lot of the projects they've worked on have failed," Avik Roy, a senior fellow at the Manhattan Institute who attended congressional hearings on the Obamacare exchange failures, told FoxNews.com.

He blamed government bureaucracy.

"In order to get through the procurement process of the federal government, you have to go through all these hoops. It's a highly organized thing just to meet all the regulatory standards. And so, the typical coders and programmers who would normally love to join a Google or a Facebook or whatever, they're never going to join a CGI Federal," he said.

But in congressional testimony, CGI Federal Senior Vice President Cheryl Campbell defended the company's performance as it continues to fix the HealthCare.gov website, which has prevented users in 36 states from enrolling or choosing a mandated health care plan.

"From our perspective, as painful as it sounds -- I know that the experience has been a difficult experience -- the system is working. People are enrolling," Campbell said in her Oct. 24 Congressional testimony.

The website's motto is "Our People Get Government. Our People Get It Done."

Campbell said, "There is no question that there are problems. And we are working together to solve those problems."

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