A considerable amount of taxpayer money is spent on federal IT projects, but in contrast to the aspirations of Obama in his early years in the Senate, it is not spent responsibly.
According to the Standish Group report, from 2003 to 2012 only 6% of the federal IT projects with over 10 million dollars of labor cost were successful.
52% of them were either delayed, went over budget or did not meet user expectations. The remaining 41% of the IT projects were abandoned or started from scratch. Perhaps most troubling is that healthcare.gov is just a one example among many.
The field of analytics has fallen into a few big holes lately that represent both its promise and its peril. These holes pertain to privacy, policy, and predictions.
Policy. 2.2/7. The biggest analytics project in recent history is the $6 billion federal investment in the health exchanges. The goals of the health exchanges are to enroll people in the health insurance plans of their choice, determine insurance subsidies for individuals, and inform insurance companies so that they could issue policies and bills.
The project touches on all the requisites of analytics including big data collection, multiple sources, integration, embedded algorithms, real time reporting, and state of the art software and hardware. As everyone knows, the implementation was a terrible failure.
The CBO’s conservative estimate was that 7 million individuals would enroll in the exchanges. Only 2.2 million did so by the end of 2013. (This does not include Medicaid enrollment which had its own projections.) The big federal vendor, CGI, is being blamed for the mess.
Note that CGI was also the vendor for the Commonwealth of Massachusetts which had the worst performance of all states in meeting enrollment numbers despite its long head start as the Romney reform state and its groundbreaking exchange called the Connector. New analytics vendors, including Accenture and Optum, have been brought in for the rescue.
Was it really a result of bad software, hardware, and coding? Was it that the design to enroll and determine subsidies had “complexity built-in” because of the legislation that cobbled together existing cumbersome systems, e.g. private health insurance systems? Was it because of the incessant politics of repeal that distracted policy implementation? Yes, all of the above.
The big “hole”, in my view, was the lack of communications between the policy makers (the business) and the technology people. The technologists complained that the business could not make decisions and provide clear guidance. The business expected the technology companies to know all about the complicated analytics and get the job done, on time.
This ensuing rift where each group did not know how to talk with the other is recognized as a critical failure point. In fact, those who are stepping into the rescue role have emphasized that there will be management status checks daily “at 9 AM and 5 PM” to bring people together, know the plan, manage the project, stay focused, and solve problems.
Walking around the hole will require a better understanding as to why the business and the technology folks do not communicate well and to recognize that soft people skills can avert hard technical catastrophes.
As the Obama administration continues its top secret effort to build federal insurance exchanges in about 34 states while 16 states are doing it on their own, that continues to be the big question.
HHS is using IT consulting firm CGI for much of the work on the exchanges and the federal data hub. CGI has their plate full since they are not only working on the federal exchange but also doing work for the state exchanges in at least Colorado, Vermont, and Hawaii.
Earlier this month, the Senate Finance Committee held an oversight hearing. The Obama guy in charge of exchange development testified before them. I thought it was notable that it was the Democrats who expressed the greatest concern, and frustration, over senators not getting a clear idea for just where the administration is toward the goal of launching the new health insurance exchanges on October 1.