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New HealthCare.gov contractor Accenture not without its own issues


By Paul Demko
Posted: January 13, 2014 - 2:15 pm ET
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Accenture Federal Services has been awarded a one-year contract worth roughly $45 million to take charge of HealthCare.gov. But the global consulting firm has had its own performance issues on past federal contracts.

“We are honored to be part of the team of technology and healthcare companies and government professionals helping the federal government meet the healthcare coverage needs of its citizens,” David Moskovitz, Accenture Federal Services' chief executive, said in a statement. “Accenture will bring deep healthcare industry insight as well as proven experience building large-scale, public-facing websites to continue improving HealthCare.gov.”

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As initially reported on Friday before the CMS announced the contract, Accenture will replace CGI Federal, which was widely criticized for the troubled rollout of the website. During its first two months of operations, HealthCare.gov experienced crippling technical problems, making it difficult for individuals to sign up for insurance coverage. Government officials and CGI have traded accusations over who was to blame.

“Obviously CGI and HealthCare.gov have a big dispute over whose fault it was,” said Robert Laszewski, a consultant who works closely with insurance companies. “When you have that kind of a situation, a divorce is likely.”

The website has functioned much more effectively since Dec. 1 after a “tech surge” led by Jeffrey Zients. By the end of last year, 1.1 million individuals had signed up for coverage through HealthCare.gov. But that's still only about a third of the enrollments projected by HHS. The signup period for 2014 continues through March 31. Federal officials were expected to release updated enrollment data Monday afternoon.

Accenture has been the lead contractor for California's insurance exchange, which has been among the most successful in the country in signing up individuals for coverage. Roughly 400,000 individuals had signed up for private plans by the end of 2013.

But Laszewski points out that Covered California has also had significant technical problems. As recently as last week, some customers were still being tripped up by computer glitches when attempting to get coverage. “Clearly Covered California has launched a lot better than HealthCare.gov, but better is a relative term,” Laszewski said.

Accenture has not been a significant HHS contractor in recent years. According to the database on federal contracts at USAspending.gov, Accenture has received contracts worth just $14.2 million since 2010. But the company has been a major vendor for other federal agencies, with $3.6 billion in contracts over the past four years.

In some instances, Accenture has received criticism for its performance. A 2013 report by the U.S. Postal Service's Office of the Inspector General (PDF) offered withering criticism of the contractor. It concluded that “the supplier has demonstrated an absence of business ethics, a lack of transparency, and insufficient internal controls in its business dealings with the Postal Service. The Postal Service should consider Accenture for suspension or debarment and review existing contracts to determine whether the contracts warrant termination.”

CGI Federal, a subsidiary of the Montreal-based CGI Group, was initially awarded the contract to oversee HealthCare.gov in 2011. It expires at the end of February.

CGI has also worked on state exchanges in Hawaii, Vermont, Colorado and Massachusetts. In late December, Massachusetts and Vermont announced that they were suspending payments to the contractor because of ongoing performance issues.

Follow Paul Demko on Twitter: @MHpdemko


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