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We may be getting a better idea why the federal exchange and so many state exchanges aren’t working.

An article in Saturday’s Baltimore Sun, regarding Maryland’s problems, provides insight I have not seen elsewhere:

Problems began immediately after the exchange launched Tuesday, as people tried to create accounts and log onto the site.

State officials blamed the account creation process, in which people were routed to a federal questionnaire to verify their identity. The system, they said, became overwhelmed when so many people tried to access it.

So, it appears all of the exchanges are facing the same bottleneck at the federal level–the identity verification software the feds are running for themselves and the state exchanges.

Then the Sun article provided more insight:

Requiring people to create accounts to access the system may be one of the problems, said Jonathan Wu, co-founder of consumer finance website ValuePenguin, who has a computer science background. Some states, including Kentucky [which as been about the only state running well], let people browse insurance plans without an account, which was only needed to purchase insurance. Kentucky did not have as big a backlog, he said.

“It’s kind of an architectural and software issue,” Wu said. “You are not accounting for how people want to use the system.”

With personal accounts, the computer system has to work harder, storing information about everyone who accesses the website, he said. It also has to repeatedly confirm the identity of the person, which also can bog down the system, Wu said. He noted that all the functions on the website that don’t require an account have run smoothly.

“It has to match your account every step you make,” Wu said. “This causes extra overhead.”


Pearce [from the Maryland Exchange] has said the log-on information is meant to serve as a security function to protect people’s identity.

The way to fix the problem, Wu said, is to add additional server capacity to handle the traffic volume, or improve the software, which is a much more complicated and time-intensive task.

Read the Sun Article

So, it appears at least one big mistake the federal exchange, and most state, developers made was to require everybody to go through a very intensive account creation process before going anywhere on the site. That process requires your personal identification information as well as answering a series of security questions (Which of the following streets have you ever lived on?).

Think about it, would you ever even bother to use Amazon, or any other shopping site, if they required you to set up an account before you could even look at their products? But that is what the feds and most of the states have done.

Much is made about the millions of people trying to access the site. With Obamacare so controversial, that should not be a surprise. In addition to people who really need insurance, you have to believe lots of other people are simply curious to see if there really is affordable coverage available.

I doubt this explanation is close to the whole story. Right up until launch, I was hearing reports of very serious testing problems on the connections between the exchanges and the insurance companies, for example. That testing is still ongoing. Computer experts all over the net are making fun of lots of other coding and architecture issues they can see on the surface. We still have lots of hurdles ahead.

It is clear that this is a lot more than a “glitch” and “evidence that the program is far more popular than people could have imagined–a great problem to have.” You have to wonder if at least part of the ultimate solution lies in a fundamental software redesign–letting people browse without going through an account set-up.

Just how popular Obamacare really is will take many months to determine.

After they fix the software architecture they screwed up.

By the way, in the 30 minutes it has taken me to put this post together, I have been “on-hold” on the federal site (“We have lots of visitors on the site right now. Please stay on this page”)–at 9 am on a Saturday.

Today, I might just be able to set up an account and see what’s available!

Or, maybe not.

Full disclosure:thought Maryland would be one of the exchanges that wouldn’t be a train wreck–which only says how badly I underestimated what a mess the state and federal exchanges would be. Now that says something.

Robert Laszewski has been a fixture in Washington health policy circles for the better part of three decades. He currently serves as the president of Health Policy and Strategy Associates of Alexandria, Virginia. You can read more of his thoughtful analysis of healthcare industry trends at The Health Policy and Marketplace Blog, where this post first appeared.

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3 Responses for “How Identity Verification Caused Chaos on the State and Federal Exchanges”

  1. MD as HELL says:

    Why not treat this like voting.

    No need to register until you want to use it. No need for ID. Why waste so much on the infrastructure you do not yet need?

    OOps!! That would make the either premium or the penalty a poll tax. It would keep people from using it.

    Where is the FastPass Line? In the ED we will have a cash track line…no waiting.

  2. Cameron S says:

    I would imagine they will rejig it so you can browse it without having to register. It makes more sense, do you have to register on Amazon? Also most of the online insurance tools don’t require registration first. It’s a little odd they did it this way.

  3. Peter says:

    The problem with identity is that Experian’s database has errors.

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