Oregon Gov. Asks AG to Sue Oracle Over Scrapped Health Exchange

Thursday, 29 May 2014 07:56 PM

By Cathy Burke

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Oregon Gov. John Kitzhaber is asking the state attorney general to sue information technology company Oracle Corp. for its failed online health insurance enrollment system.

Oregon paid Oracle $134 million in federal funds to build what turned out to be a dysfunctional website that forced users into a cumbersome, time-consuming process of filling out paper or online applications that were processed, at least in part, by hand.

The state has paid Oracle well over $130 million for the exchange; rather than trying to fix the problems, Oregon scrapped the exchange in favor of the federal portal.

The state is still withholding $25.6 million in payments from Oracle.

"There is ample cause there to file a lawsuit," Kitzhaber declared, The Oregonian reported Thursday.

"We were not delivered a product that worked and we certainly weren't delivered a product on time."

Kitzhaber also wrote a letter Thursday to the federal Department of Health and Human Services to "levy the appropriate fines and penalties" against the company, asking Oregon's Democratic Sens. Ron Wyden and Jeff Merkley to help in the matter, the newspaper reported.

Kitzhaber conceded the state made its own mistakes during the project.

"There is no question that the failure to hire a system integrator and the use of time-and-material contracts contributed significantly to the culpability on the state side, and we have taken steps to address that," he said.

Yet, the governor charged he doesn't believe by "any stretch of imagination that Oracle ... had no idea that they were actually supposed deliver a product that worked. They did not become the largest software company in the world in that way. I just think that's laughable.

Maybe there's a legal basis there, but c'mon."

Cover Oregon, the public corporation that oversees the health insurance exchange, has become a political rallying cry for the governor's opponents as Kitzhaber faces re-election in November, the Oregonian notes. He faces Republican Dennis Richardson.

"But reelection had nothing to do with this," he said.

The Associated Press contributed to this report.

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