Oracle pulls 100 workers from Cover Oregon project

PORTLAND, Ore. (AP) -- Oracle Corp. is pulling nearly two-thirds of its software developers from Oregon's troubled health insurance exchange project, even though the public still doesn't have access to the promised seamless, swift sign-ups for coverage, and key features are unfinished.

One hundred Oracle developers will leave by the end of this week, with 65 remaining to continue working on the site, Cover Oregon spokesman Michael Cox said Thursday.

The cutbacks, first reported by The Oregonian, come after the online enrollment system was rolled out last week to insurance agents and community organizations — more than four months after it was originally scheduled to be operational and after the state has paid Oracle more than $90 million in federal funds on the project.

As of last Friday, the organizations and agents reported the first sign-ups entirely online for private insurance: 700 people.

Early on, Cover Oregon planners hoped to have at least 38,000 people enrolled in private insurance by the end of February — and thought as many as 84,000 sign-ups were possible.

They envisioned a process in which people could go online, enter their data, have the system check their eligibility for tax credits and subsidies, and select a plan — all at one sitting.

Instead, the state has been taking the applications on paper and online and then, with 400 workers hired for the task, processing them manually. As of Feb. 6, the most recent data available, about 35,000 people have been enrolled that way in private insurance.

The state has enrolled about 67,000 more people in Medicaid using the hybrid system. Another 123,000 people have enrolled in Medicaid through a process that bypasses Cover Oregon.

Cox said Cover Oregon is now focusing on fixes to the system, launched Friday, with the hope of opening up to the general public before the current enrollment period ends March 31. But no date has been set for the public launch.

Website features that remain unfinished include the ability for small businesses and employees to enroll in coverage or interfaces that link the exchange to insurance carriers. Cox said work on those features is on hold, so fewer developers are needed.

"We will not do any more big production pushes during open enrollment. These staffing changes reflect that," Cox said.

Oracle has refused to comment on the exchange debacle since the site failed to go live in October, and spokeswoman Deborah Hellinger did not return calls Thursday.

Exchange officials have hired a law firm to review the state's contract with the Redwood City, Calif., company and brought in two experts to review the coding of the exchange. Cover Oregon also contracted with a technology consultant to look at backup alternatives, such as working with another tech contractor to finish the site, buying additional software, or using technology that's functioning in other states or the federal government.

Since the failed launch, Cover Oregon has withheld approximately $35 million in payments to Oracle.

Cox said the staff cutbacks do not signal an end of the work relationship with Oracle nor the choice to go with another alternative to finish building the troubled exchange. The state would make that decision after open enrollment ends in March, he said.

Gov. John Kitzhaber's spokesman Nkenge Harmon Johnson said the developer cutbacks are "no surprise" and the governor "is aware that Cover Oregon continues to work with Oracle to set appropriate staffing and skill-set levels as needed during this project."