- - Tuesday, March 31, 2015

Deception and unaccountability have plagued Obamacare from the start. First, millions of Americans found out that, contrary to promises, they couldn’t keep the health insurance plans they liked. Then a botched website rollout spoiled the law’s enrollment debut. Now, in the law’s first real tax season, the federal government sent 800,000 enrollees incorrect tax forms.

These episodes can be chalked up to government incompetence at best, broken campaign promises at worst. But the latest Obamacare mishap in Oregon has the makings of a real scandal, and shows the law is not only unworkable, but has been a platform for serious government back-dealing and corruption.

John Kitzhaber, the now disgraced ex-governor of Oregon, recently resigned amid various charges of corruption involving his fiancee Cylvia Hayes, who allegedly used their relationship to secure consulting jobs for her firm and for personal financial gain.


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The national media has mainly focused on the potential abuse of funding for “green” government projects, but according to local news reports, Mr. Kitzhaber’s misconduct extends to the state’s implementation of Obamacare: The former governor was up for re-election in 2014, and in the same year he decided to put a secretive campaign consultant in charge of Cover Oregon, the already-failing state exchange.

The consultant, Patricia McCaig, likes to call herself “the Princess of Darkness.” Her Rumpelstiltskin-level spin-job on Cover Oregon was aimed to shift blame and protect the governor.



In the end, Mr. Kitzhaber got re-elected, but in the hands of a campaign consultant who admitted to knowing nothing about health care reform, Cover Oregon failed.

The story of Cover Oregon is ironic and sad. Identified early on as an ambitious and unique state exchange, it received a $48 million “early innovator” grant, which ultimately grew to $59 million. The exchange seemed destined for success because the state put various oversight mechanisms in place, requiring that various agencies report to the governor’s office about the progress of the exchange.

Early reports cited various red flags. According to an investigation by local TV station KATU, Cover Oregon was flagged for hurdles such as “unclear deadlines, being too dependent on other agencies and being too aggressive in scope.” Every single report deemed the project “high risk.”

However, the governor’s office ignored the warnings, and seemingly only took interest in making the exchange look like a success to the public. In emails documented by KATU, state officials said they faced pressure from Mr. Kitzhaber’s office to launch the exchange on Oct. 1, 2013, even though it was clear that it would not be ready. (And it wasn’t; it was a total failure.)

As of early March 2014, not one single person had successfully enrolled for coverage through Cover Oregon. It was near this same time that the governor turned over the reigns to Patricia “Princess of Darkness” McCaig.

According to an investigative report from Williamette Week, Ms. McCaig oversaw many decisions, including Oregon’s April 2014 shift to the federal exchange and the state’s lawsuit against Oracle, the information technology consulting firm that built the Cover Oregon website. The message from Oregon’s state government was that Oracle, not the government, was responsible for the health insurance exchange effort falling apart.

Ms. McCaig’s emails to the governor indicate that she was mainly interested in damage control and sought to coordinate a campaign-led effort with official state communications on Cover Oregon. Her goal was not to alleviate the pain of Obamacare for the hundreds of thousands of Oregonians who were trying to navigate the law’s choppy waters, but to save face for the governor in an election year.

In the end, this debacle in Oregon has cost federal taxpayers $300 million, and will cost another $41 million as the state transitions to the federal Healthcare.gov. Now you tell me: How many people could Oregon have helped with $341 million? Instead, this money, like so many other resources caught in Obamacare’s web, has been completely wasted.

Was this a result of complete incompetence, or was this a result of deliberate misuse of public funds to pay off consultant-cronies? Either way, taxpayers have a right to know, and Congress should press hard into an investigation of how those funds disappeared. The federal government made these funds available to Oregon, and Congress has a duty to investigate how taxpayers’ funds were spent.

Overly complex government schemes such as Obamacare invite deception and political corruption. The trouble with Oregon’s exchange does not stand alone as the only example of Obamacare malfeasance. But it does stand apart as a particularly egregious episode in the saga of the health law’s scandal and shame.

Hadley Manning is the director of health policy at the Independent Women’s Forum.

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