http://www.businessweek.com/articles/2013-10-31/four-things-we-actually-learned-from-kathleen-sebelius-testimony

Obamacare

Four Things We Actually Learned From Kathleen Sebelius's Testimony


Sebelius being sworn in on Capitol Hill

Photograph by J. Scott Applewhite/AP Photo

Sebelius being sworn in on Capitol Hill

There was plenty of drama at yesterday’s House Committee on Energy and Commerce hearing. Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, appeared to explain the now-infamous launch of healthcare.gov. Republicans tried to tarnish Sebelius. Democrats were determined to protect her (and perhaps themselves) against the political backlash after countless people tried and failed to buy insurance on the website. Amid all the posturing, though, here are four things that became clear.

1. The administration was astonishingly unprepared. The website is a key component of Obamacare. Millions are supposed to use it to buy insurance, in many cases with federal subsidies. President Obama promised that it would be as easy to use as Amazon.com. So you’d think the administration would have prepared for the worst and that there would have been a contingency plan in case of disaster.

Not so. “We always knew that there would be the possibly that something would to wrong,” Sibelius testified. “No one indicated that this could possibly go this wrong.” The White House initially portrayed the problems as primarily technical. As the facts come in and administration officials spread blame, it’s becoming increasingly clear that the real problem was an astonishing degree of incompetence.

2. The White House no longer has confidence in the Centers for Medicare and Medicaid’s ability to oversee the site. Prior to the launch, CMS was responsible for making sure that all the website’s functions were integrated. That’s no longer the case. Sebelius said that QSSI, one of the private contractors working on the site, is now in charge of integrating it. Never mind that, according to her testimony, QSSI said heathcare.gov was ready for business on Oct. 1, a notion that’s laughable now. The White House is still more comfortable with a private company overhauling the site than having its appointees at CMS doing so.

3. If anyone is likely to take the fall, it’s Marilyn Tavenner. Sebelius was careful not to reveal much in her  testimony. However, she made a point of blaming CMS for deciding not to allow customers to browse the website for insurance-policy prices before signing up. This would be like Amazon (AMZN) asking for people’s credit-card information before they looked at books. The person responsible for making that call was administrator Marilyn Tavenner. It was a damning moment, especially since Sebelius herself is being widely criticized for having distanced herself from the website’s creation.

4. The Obama administration fears that frustrated users won’t return. Sebelius said the website is getting better by the day but said she didn’t want people visiting it just yet. She’s concerned that young, healthy people who have visited the site and tried unsuccessfully to purchase insurance may not give it a second chance. That would be terrible for Obamacare. The White House is counting on young people to offset the cost of insuring older people who have serious health problems. Sebelius said the White House is trying to come up with a solution. “We intend to invite them back formally by e-mail, by message,” she said. Given how dysfunctional everything having to do with the Obamacare website has been—and still is—that e-mail could be a long time coming.

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Leonard is a staff writer for Bloomberg Businessweek in New York.

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