What’s Next for Healthcare.gov?

The launch of HealthCare.gov certainly didn’t go as planned. Due to technical errors, millions of Americans were sent to the functional equivalent of a waiting room before they could enter the shopping portion of the site.

Historically, projects of such complexity and demand have encountered early problems yet still often achieve great success. While much of the commentary has focused on coding problems, the site still has the potential to spur innovation — be it public or private —  that will result in quality improvement and lower costs.

For context, the HealthCare.gov site is merely the front door to an incredibly complex technological undertaking tasked with organizing insurance plans, assessing program eligibility, facilitating consumer enrollment, managing financial services, and providing all of the associated customer support.

An estimated 19 million people visited the site through Sunday, and many did so at the same time; at peak periods, there were five times as many simultaneous visitors as had been expected. In rapid response to that surge, the HealthCare.gov team tried to restrict the number of visitors to the area of the site where they could establish accounts and begin shopping.

Naturally, this was not ideal, but it was preferable to the alternative.

When Internet entrepreneurs prepare to launch a new service, they tend to anticipate two scenarios. The first, and worst, is that nobody visits. The other is that too many people do.

Rise of a new platform

Drawing from my experience as CTO in President Barack Obama’s first term, we overcame initial technical challenges in popular programs such as “Cash for Clunkers” or the Post-9/11 GI Bill of Rights for veterans through an analysis of the root cause problems — and a systematic plan to address them.

I’m confident that the HealthCare.gov team will similarly fix the technology with the help of experienced technical talent – in and out of government – to work through its punch list. The site should continue to improve in the weeks ahead, building toward Dec. 15.

But the real story, likely to play out over the coming months, will be its rise as a new platform for innovation – one that will lead to the creation of new private sector services to improve our nation’s health.

First, consumers will soon have access to a growing array of Internet-enabled brokers competing to help select a plan that is right for them. In addition to mature firms like eHealth and GetInsured, a growing array of startups like Fuse Insurance and Gravie will offer more personalized recommendations. These services benefit from a policy decision allowing technical access to HealthCare.gov.

In other words, like tax preparation, a consumer can either download forms at irs.gov, or complete them online through private services like TurboTax or H&R Block — but at no additional cost (these Web-enabled brokers are compensated by existing commissions).

Second, consumers will have access to better health care services due to the level playing field delivered by the exchanges. After decades in which a small number of insurance companies have dominated market share in some states and locked in the status quo, the exchanges have increased competition.

Take the Nevada market, where primary care services from innovative service provider Iora Health will, for the first time, be available through insurance products sold by the Nevada co-op on the exchange. Iora has built a new model of primary care focused on treating patients, especially the sickest ones, in a more coordinated manner – with incredible early results. For instance, over 85 percent of Iora’s patients with hypertension have the condition under control, as compared to the national average of around 50 percent. Better yet, this better care has led up to 15 percent reductions in total health care costs.

Third, HealthCare.gov will catalyze a growing number of private sector exchanges, offering greater choice and service to millions of Americans with employer based coverage. HCentive, for example, is fielding requests from small business owners who are seeking marketplaces as offered large employers through firms like Bloom Health. Others like Liazon and Maxwell Health are attracting venture capital at a fast clip.

Right now, the focus is rightly on correcting the technical issues at HealthCare.gov, but we shouldn’t ignore the very real benefits of the site. These and many more services built on top of data from Healthcare.gov will help realize President Obama’s vision of a health care system that achieves improved care, better service, and lower cost. The journey has just begun, and it will be worth the wait.

Aneesh Chopra is a senior  advisor at The Advisory Board Company, senior fellow at the Center for American Progress, and the former U.S. chief technology officer in the Obama Administration. He is also the author of the forthcoming book, Innovative State: How New Technologies will Transform Government. This post originally appeared in Venture Beat.

12 replies »

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  2. The IT of Obamacare and its security can not be trusted, and should not be.

  3. Deciding which of two dozen plans is the best deal isn’t easy but, in the spirit of Aneesh’s post, help could be on the way.

    Consider the information in the state-run All Payer Claims Databases that collect the actual total out of pocket costs of every citizen. Given digital access to one’s data at the APCD, the health insurance exchange, or an affiliated service, could list the retrospective costs of each plan being offered and eliminate much of the guesswork needed today.

    Medicare.gov already provides a Blue Button file with the collected claims. Now that we have health insurance exchanges, it’s time for state-level claims registries to adopt this practice and provide Blue Button Plus portals for automated citizen access to our own data.

  4. Sorry, I had to stop reading after this bold faced lie: “Historically, projects of such complexity and demand have encountered early problems yet still often achieve great success.”

    The NPfIT in the NHS, the largest health IT effort to date, failed.

    More generally, see “See Pessimism, Computer Failure, and Information Systems Development in the Public Sector”. Public Administration Review 67;5:917-929, Sept/Oct. 2007, Shaun Goldfinch, University of Otago, New Zealand.

    Preview at http://www.jstor.org/discover/10.2307/4624644?uid=3739864&uid=2129&uid=2&uid=70&uid=4&uid=3739256&sid=21102828298677 for a more honest appraisal.

    The article begins:

    The majority of information systems (IS) developments
    are unsuccessfu1. 1 Th e larger the
    development, the more likely it will be unsuccessful.
    Th ough the exact numbers are uncertain and
    depend to some extent on how success is measured,
    something like 20 percent to 30 percent of all developments
    are total failures in which projects are abandoned.
    Around 30 percent to 60 percent are partial
    failures in which there are time and cost overruns or
    other problems. Th e minority are those counted as
    successes ( Collins and Bicknell 1997; Corner and
    Hinton 2002; Georgiadou 2003; Heeks and Bhatnagar
    1999 ; Heeks 2002, 2004 ; Iacovou 1999; James
    1997; Korac-Boisvert and Kouzmin 1995 ; Standish
    Group 2001, 2004 ).

    A U.S. survey of IS projects conducted by the
    Standish Group in 2001 found that success rates
    varied from 59 percent in the retail sector to 32 percent
    in the fi nancial sector, 27 percent in manufacturing,
    and 18 percent in government. Overall, the
    success rate was 26 percent. In all, 46 percent of projects
    had problems, including being over budget and
    behind schedule or being delivered with fewer functions
    and features than originally specified.

    28 percent failed altogether or were cancelled. Cost
    overruns averaged nearly 200 percent. Th is success
    rate varied dramatically by total project budget: For
    projects under US$750,000 the success rate was 55
    percent; for those with budgets over US$10 million,
    no projects were successful ( SIMPL/NZIER 2000 ).
    More recent Standish Group (2004) estimates saw a
    success rate of 29 percent, but 53 percent of projects
    had problems and 18 percent failed.

    A New Zealand government study judged 38 percent
    of government projects a success, while 59 percent
    involved problems and 3 percent were a complete
    failure or were cancelled. Government success rates, at
    31 percent, were slightly higher than private sector
    success rates. Above the NZ$10 million mark,
    however, the success rate for both was zero (SIMPL/
    NZIER 2000). One study of hundreds of corporate
    software developments found that fi ve out of six projects
    were considered unsuccessful, with one-third
    cancelled outright. Of the two-thirds that were not
    cancelled, price and completion times were almost
    twice what had originally been planned ( Georgiadou
    2003 ). Th e Royal Academy of Engineering and the
    British Computer Society (2004) found that 84
    percent of public sector projects resulted in failure of
    some sort.

    Th e sums involved in such projects can be staggering.
    A study of IS developments in the British public
    sector estimated that 20 percent of expenditures were
    wasted, and a further 30 percent to 40 percent led to
    no perceivable benefi ts ( Wilcocks 1994 ). In 1994, the
    U.S. General Accounting Offi ce reported that spending
    of more than US$200 billion in the previous
    12 years had led to few meaningful returns.

    It is accompanied by extensive references.

  5. Why didn’t CMS seek advice from the Federal government’s chief technology officer before attempting to set up the health care exchange? Perhaps the fiasco could have been avoided.

  6. “After decades in which a small number of insurance companies have dominated market share in some states and locked in the status quo, the exchanges have increased competition.”

    Really? Not in North Carolina or Mississippi, or Alaska or Wyoming. Insurance companies are not obliged to cover anyone in any state. Look for consolidation in insurance to reduce profit loosing “competition”.

    The other negative press occurring are rate increases for already insured individuals and families as their once affordable policy is now costing more due to ACA requirements. Those requirements may be good policy but not to people having to accept double their earlier rates – with no subsidy.

    I also wish we would stop referring to this program as the AFFORDABLE care act. It is the SUBSIDY Care Act.

  7. A government created internet exchange was utterly un-needed. The standardization of the policies into three classes was a nice feature which clarifies things for the consumer. But the existing national network of agents and internet sites could have sold the policies. And after the healthcare.gov is finally abandoned, that’s likely what will happen.

    The author overlooks the one to three million individual policy holders who are losing coverage by the first of the year as well as a like number of group policy holders all of whom are as yet unable to purchase comparable coverage on the exchange. It is very likely that there will be several million more uninsured persons ex-post healthcare.gov than ex-ante.

  8. Nicely said Aneesh. We had met several times during your Lt. Governor compaign. I want to reiterate my thoughts it is not easy to put together something which is complex and integrates with so state and federal agencies. I echo your thoughts that in grand scheme of things Obamacare will be a game changer for overall Health of the American people. We should realize that Obamacare is much much more than a “website”