Cover Oregon, Oracle reach agreement to get through open enrollment

PORTLAND, Ore. - The Cover Oregon website claimed another high-profile victim on Monday when interim director Bruce Goldberg announced the healthcare exchange is parting ways with independent software developer Oracle.

As part of the agreement, Cover Oregon will pay $43.9 million this week and withhold the remaining $25.6 million of the $69.5 million Oracle claimed for development work between November 2013 and the end of February.

The deal is essntially a truce that allows Cover Oregon to work with Oracle for the remainder of the enrollment period without the threat of Oracle pulling all of its developers off the job over the withheld funds. At the end of the 60-day agreement, both sides can still seek legal recourse.

Though the enrollment deadline is at the end of March, Goldberg said the deal was for 60 days because Cover Oregon has asked the federal government for an extension through April.

"Our goals clearly were to continue to be able to enroll people and to have that be a focus - to not in any way jeopardize our ability to enroll people," Goldberg said. "I think as you know, we're looking for a potential extension from the feds. We're looking at potentially a two-month period."

The announcement comes at the end of an independent investigation by First Data, which, among other things, was designed to look into Oracle's responsibility for a website that's still not fully functional more than five months after its scheduled go-live date.

It also comes just as Cover Oregon finished its latest build, which allowed consumers to enroll online through agents and community partners. Goldberg said about 1,700 people have signed up through that new system.

Oracle took about 100 developers off the project last week, and Golderg said it wouldn't make sense to continue racking up Oracle bills with the project's future up in the air. That means full functionality could still be months away.

"We've indicated that we weren't going to be doing any major development at this point," he said.

"As we indicated last week, we were finished with the current release. And all that was left for the next month or two was to maintain and fix that release, so we didn't need those 100 developers. Had they been here, we would've been paying for work that wasn't needed at the current time, and so that's why those individuals are no longer here."

Goldberg said Cover Oregon will instead turn its attention to having the website ready for the next open enrollment period. The site, which was supposed to be fully functional Oct. 1, still doesn't allow consumers or small business to sign up on their own.

Meanwhile, Gov. John Kitzhaber expressed pessimism about the prospects for Cover Oregon and Oracle finishing the website before the end of March, when nearly all Americans are required to have insurance under the federal health care law.

"It has become increasingly clear that we may not be able to have the public portion of the website operational for the current enrollment period," Kitzhaber said in a statement following Cover Oregon's announcement. "While I am deeply disappointed in the technology's performance to date, we must do everything possible to ensure that we continue to enroll Oregonians through our current process."

Last week, an offical said Oracle was refusing to provide First Data with access to six employees it wanted to interview.

"Governor Kitzhaber directed us to create a plan for the remainder of this open enrollment period, and create a path forward for the next," Goldberg said in a press release. "This agreement will allow us to continue enrolling Oregonians now and to create a smooth transition."

Multiple calls to Oracle from the KATU On Your Side Investigators were not returned.

Oracle agreed to continue providing maintenance and repairs, and it will also help in the transition. About 65 developers will stay on the project, with a cap of $3.9 million in billing in March.

Cover Oregon will consult a group that includes experts from the private sector to figure out the best way forward. That could include retaining technology that's working now and working with a new developer to finish the project, or bringing in technology from either other states or the federal exchange.

"Both sides had something that the other wanted," Goldberg said. "They had people and expertise that we needed, and we had dollars that they wanted. That's what we came to an agreement about."