Officials refuse to provide an update on how much of the back end remains incomplete. Parts of Obamacare site still missing

The Obamacare website may work for people buying insurance, but beneath the surface, HealthCare.gov is still missing massive, critical pieces — and the deadline for finishing them keeps slipping.

As a result, the system’s “back end” is a tangle of technical workarounds moving billions of taxpayer dollars and consumer-paid premiums between the government and insurers. The parts under construction are essential for key functions such as accurately paying insurers. The longer they lag, experts say, the likelier they’ll trigger accounting problems that could leave the public on the hook for higher premium subsidies or health care costs.


It’s an overlooked chapter in the health care law’s story that has largely escaped scrutiny because consumers aren’t directly affected. Yet it bolsters the Republican narrative that the government has mishandled the implementation of Obamacare.

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“It seems like the insurers’ experience with Obamacare is a lot like that of far too many Americans: broken promises, frequent delays and constantly shifting rules of the road,” said Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell (R-Ky.). “It seems like there’s a lot more to the story than what the administration says in their pep rallies.”

Without a fully built and operational system, federal officials can’t determine how many of the 8 million Obamacare sign-ups announced earlier this month will have actually paid their premiums. They won’t even know how many enrollment attempts were never completed. That, in turn, could affect the amount of money the government spends on premium subsidies. And once the system finally does all come online, the data delays could force a sharp revision in that celebrated 8 million figure.

Obama administration officials originally intended to have the major back-end components of HealthCare.gov working by the website’s launch in October. But the deadline slipped as officials focused their energy on the part of the website that consumers would use to enroll in coverage.

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When that front end failed disastrously on Oct. 1, the administration diverted every resource to fix it, further delaying the behind-the-scenes technical functions. The deadline for completing those pieces gave way to January and then to mid-March. Senior officials said early last month that they hoped to have the entire system ready by the summer. Now, even summer appears to be a question mark.

Officials at the Centers for Medicare & Medicaid Services — the federal agency overseeing HealthCare.gov and new insurance exchanges — refused to provide an update on just how much of the back end remains incomplete, the current issues they face and their latest timetable.

The site was envisioned as an easy-to-use portal for insurers as well as their customers. It still needs to be that and more. It’s supposed to automatically calculate exact premium subsidies for enrollees and match them with government records to ensure accuracy. It’s also expected to trigger payments from the U.S. Treasury to insurers and measure whether an insurance company’s customers are sicker or healthier than expected — a determination that could affect future premiums.

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The Obama administration posted a document earlier this month indicating that insurers will continue to be paid through an “interim” accounting process — pretty much a spreadsheet and some informed estimates — until at least September. When the permanent system eventually goes live, it could lead to a massive correction that either exposes taxpayers to more costs or puts pressure on insurance companies to raise prices.

“We have the mother of all reconciliations coming,” said insurance industry consultant Robert Laszewski, using the official term for the correction. “It may be that the administration will not be able to give us a credible enrollment number until then because we really need a reconciliation to accomplish that.”

CMS warned late last year that without a permanent system in place by mid-March, the whole law could unravel and expose taxpayers to a huge risk. The agency has since pulled back from that dire projection.

“We have an interim process in place to calculate and make payments to [insurers] on time,” CMS spokesman Aaron Albright said. “This interim process does not impact consumers’ access to advance premium tax credits or cost-sharing reductions.”

The trade group America’s Health Insurance Plans expressed concerns in a letter to the administration on Feb. 25 and again on April 21, when the group noted that “many manual processes will remain for the bulk of 2014.”

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“While the functions at HealthCare.gov and the overall enrollment process continue to improve, significant issues remain,” the group wrote. “[C]ore functions … are not yet operational. Instead, CMS has asked plans to utilize interim processes until systems can be developed and tested. Complicating all of this work is a lack of clear, written guidance on the many operational and policy issues that have arisen.”

Although the insurers say they can live with the delays for now, the urgency will increase as Obamacare nears its second enrollment season in November.

“I think there comes a point where it becomes unmanageable,” said Dan Schuyler, director of exchange technology for the consulting firm Leavitt Partners.

The unfinished back end also has experts worried that the administration is relying on inaccurate estimates to calculate Obamacare’s financial impact.

Stephen Parente, a University of Minnesota expert on health finance, said that when the full system finally starts working, it could expose earlier enrollment numbers as flawed and spark a renewed wave of politically charged investigations. He also noted that insurers could ultimately decide they’ve been shortchanged by the interim process and back out of Obamacare altogether, sending premiums soaring at a delicate time during the 2016 election season.

HealthCare.gov’s missing components first made headlines in November, when a senior Obama administration tech official told Congress that as much as 40 percent of the site had yet to be built. But the issue faded as the website started working better for consumers.

Several times, senior officials promised the site’s back end would be operational soon, only to later cite delays. In December, Health and Human Services Secretary Kathleen Sebelius targeted mid-January as the launch date. Later that month, a CMS document warned that the system had to be in place by mid-March or else “the entire health care reform program is jeopardized.”

“If this functionality is not complete by mid-March 2014, the government could make erroneous payments to providers and insurers,” according to the document, which was signed by senior CMS officials and used to justify a shortcut to hire Accenture as the website’s new contractor.

By March, when the administration began fielding questions about how many of Obamacare’s millions of enrollees had actually paid their premiums, officials acknowledged that much of HealthCare.gov remained under construction.

CMS Administrator Marilyn Tavenner, speaking at a budget briefing, identified these functions as one of her agency’s top priorities. “They’ll be fully developed over the summer,” she pledged.