Fighting the Next Obamacare Tech Fail

A head has rolled, but the body remains broken.

In terminating CGI Federal's role in HealthCare.gov, President Obama finally "fired" one of the parties responsible for Obamacare's faulty website. That may appease the chorus of those calling on Obama to hold someone "accountable," but it does nothing to fix the underlying problem: the system for selecting contractors that picked CGI Federal in the first place.

"The worst thing we can do is declare victory and go home," said Stan Soloway, president and CEO of the Professional Services Council. "We may or may not have helped HealthCare.gov, but we've done nothing to fix the systemic issue."

IT experts say that preventing the next HealthCare.gov would require a top-to-bottom overhaul of the way the government picks and manages contractors, and that won't be easy. Such reform would require bipartisan, bicameral coordination from a Congress that frequently fails to pass even the most straightforward bills; and a significant shift in culture that brings government management of IT in line with rapidly developing technology.

So what would it take to connect the best firms with the biggest federal contracts? Advocates in the field identify three major reforms.

Step 1: Change who calls the shots

Government needs to create a centralized office for developers and designers to test IT and respond to problems as they surface, said Clay Johnson, an IT-reform crusader and former presidential innovation fellow.

Such a dedicated team of tech-literate people could communicate with contractors directly about a project's progress and challenges, help solve them, and, most importantly, counsel the government on which groups should be awarded contracts in the first place.

"There are plenty of people inside of government who know technology and are really good with technology," Johnson said. "But the problem is that those people don't have a lot of power on how these purchasing decisions get made."

Step 2: A more transparent bidding process

Procurement-reform advocates additionally want to see contracting officers make bids for IT contracts a more open process, where anyone—large consulting behemoths or innovative start-ups—can apply for the right to do business. This seems like an easy fix, but the reason bidding wars are often limited is because of a no-risk environment for contract protests, in which losers can file a petition with the Government Accountability Office against a winning contract even if their complaints are entirely meritless.

Johnson favors implementing "an NFL yellow-flag rule" that would limit the number of protests a potential contractor could file in any given year. He also wants to ease the regulatory hurdles a company needs to clear before it can even be considered a government contractor, as the current system incentivizes bureaucratic fluency over skills and potential.

Step 3: Competitive pay for top talent

Procurement reform requires better compensation for contract officers, who could easily find much higher wages working in places like Silicon Valley—where the average developer hauled in $118,900 in 2012, according to a study by a Bay Area technical-recruitment firm. That's tens of thousands of dollars more than what similar jobs in government can offer, according to data tracked by the Office of Personnel Management,Glassdoor.com, and others. Monetary incentives for successful projects and investments in training workshops for officers are frequently-floated solutions.

So what's standing in the way?

Democrats and Republicans generally agree on the need for these kinds of reforms, and the HealthCare.gov disaster added pressure to accelerate legislation that would prevent a similar tech debacle from happening again. Yet a bipartisan bill that had momentum at the end of last year has once again hit a wall in Congress.

The Federal Information Technology Acquisition Reform Act (FITARA), cosponsored by Reps. Darrell Issa, R-Calif., and Gerald Connolly, D-Va., would address some, but not all, of the concerns raised by procurement-reform agitators. The bill was passed in the House in June of last year, and was tacked on as an amendment to the Senate's annual defense reauthorization bill before being stripped off in December. FITARA—which would create an office to coordinate IT product acquisition, boost authority of the Chief Information Officers Council, restrain wasteful spending on IT acquisitions, and require agencies to more thoroughly track and report their IT issues—is currently languishing in the Senate Homeland Security and Governmental Affairs Committee.

A major element of FITARA involves consolidating authority in a central chief information officer, which supporters say would have prevented, or at least quelled, the management issues that plagued the implementation of the Affordable Care Act. "The [HealthCare.gov] rollout didn't have a project director," Connolly said. "FITARA addresses that and chooses one person called CIO with the responsibility, accountability, and flexibility of decision-making."

The reform measures included in FITARA have broad support from both parties, both chambers, and the president, yet it seems ambivalence—not opposition—got in the way. Connolly said he is still optimistic that the bill will pass in the near future.

Yet the Senate remains stuck, at least for the moment. While the bill has passed easily in the House, Connolly predicts it will go through several iterations in the upper chamber.

Even FITARA's supporters say the bill may not accomplish everything, but it's a start. "Federal IT reform is an incredibly large issue," said Caitlin Carroll, a spokeswoman for Rep. Issa. "There are always more things we could be doing; for now it's a good step in the right direction."

In the meantime, there is little reason to expect a change in how IT contracts are determined. Due to the tight time frame to build the remainder of the online system, the Centers for Medicare and Medicaid Services used an "expedited procurement process" in their hiring of Accenture, in accordance with Federal Acquisition Regulation.

According to CMS officials, this interim approach lasts 12 months, and the agency expects to conduct a "full and open competitive process" during that time. The website could get a third change in leadership in its first year and a half.

CMS declined to comment on how management or contractor changes fit into the larger goal of federal IT procurement reform, and it seems the two are largely separate, at least until more sustainable changes are made.

"I focus less on the contractor chosen—that's one issue. But the ability of the federal government to manage whatever contractor it chooses? That's what's wanting," Connolly said. "Internally, we need reform. We need to step up our game."