Oregon, Oracle at odds over botched exchange

Although Gov. John Kitzhaber wants to take Oracle Corp. to court over the state's failed health insurance exchange, Cover Oregon, the private contractor views the move as nothing more than political posturing.

In a statement to Modern Healthcare, Oracle argues that blame rests with the government.

“Contrary to the story the state is promoting, Oracle has never led the Oregon health exchange project. (Oregon Health Authority) and Cover Oregon were in charge and badly mismanaged the project by consistently failing to deliver requirements in a timely manner and failing to staff the project with skilled personnel,” according to the statement. “The governor admitted as much in his statement, and these facts are supported by extensive documentation. We understand the political nature of the announcement just made and that the governor wants to shift blame from where it belongs. We are proud of the work that we have done to enable over 420,000 Oregonians to enroll in healthcare. We look forward to an investigation that we are confident will completely exonerate Oracle.”

Kitzhaber wrote a letter Thursday to Attorney General Ellen Rosenblum urging a lawsuit against Oracle for its role in the insurance exchange. Oregon paid Oracle $134 million for its contribution to the website, which was crippled by technical glitches and left many residents unable to buy insurance. The depth of the problems led Oregon to abandon the site and turn to the federal HealthCare.gov to sign up residents in the next enrollment period.

“Oracle's failure is unacceptable to Oregonians who need and deserve quality healthcare and who have been faced with months of uncertainty, confusion and delays,” Kitzhaber said in a statement Thursday. “And it is unacceptable to me and my commitment and responsibility to this state.”

Michael Kron, an attorney with the Oregon Department of Justice, said the office will not comment on potential litigation. However, in a letter dated Thursday to Kitzhaber, Rosenblum said she and her department are looking into the matter and will provide him a “confidential update” when possible.

“I assure you that since your initial request in late March, my legal team has been fully engaged in the 'legwork' needed to implement your direction to consider all legal options,” Rosenblum wrote. “This involves thoroughly investigating the facts and developing successful legal strategies.”

Follow Bob Herman on Twitter: @MHbherman