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Accenture to Clean-Up CGI Group’s Healthcare.gov Mess

By  +Follow January 10, 2014 1:45PM
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The hullabaloo that surrounded the Oct. 1 launch of Healthcare.gov only took a matter of hours to turn to a choir of criticism as potential users failed and failed again at trying to sign-up for the new insurance marketplace at the center of the Affordable Care Act, or Obamacare as its colloquially known. As the website nightmare played out, experts detailed coding and computer system problems and Congressional hearing were held, with the common theme being finger pointing at CGI Group, Inc. (GIB)

Montreal, Canada-based CGI Group is the parent company of CGI Federal, the information technology company contracted to handle the majority of the web design and management. During hearings in Washington late in 2013, Marilyn Tavenner, the administrator of the Centers for Medicare and Medicaid Services (CMS), which overseas Healthcare.gov, and U.S. Health Secretary Kathleen Sebelius testified that CGI had failed at meeting its contractual obligations.

Technology pundits appeared regularly in the media describing countless problems as to why the website was operating extremely poorly. Other sources, such as Newsweek and The Fiscal Times, were quick to point out ethical concerns with CGI Group and that current CGI Federal executives had a history of botching other government projects while at different firms and that the company was selected because of a relationship with the Obama administration.

Even the President called the launch “screwed up.”

Well, CGI has been given the proverbial boot, according to an article from The Washington Post on Friday. The Post citing an unnamed source (who wish to remain anonymous because the deal is not yet finalized) when it reported that the government is not renewing a contract with CGI when it expires at the end of February. Instead, it appears that the Obama administration will be opting to sign a 12-month, $90 million contract next week with Accenture Ltd. (ACN) , the consulting company that was responsible for the building of California’s new health insurance marketplace, which has performed far more efficiently than Healthcare.gov.

“We continually evaluate our needs and remain focused on ensuring consumers have access to affordable, quality coverage,” said CMS spokesman Aaron Albright to the Washington Post, neither confirming nor denying the switch to Accenture.

Accenture spokeswoman Joanne Veto merely told the Post that the company is regularly in discussions with potential clients.

Although CGI has reportedly devoted countless resources to right the gallimaufry underpinning the healthcare.gov website and administration officials have touted fixed malfunctions and more than one million users picking plans, the website still has problems. Hopefully, Accenture can come in and be lauded for its expertise to fix the lingering issues and put this whole debacle behind us.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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By  +Follow January 10, 2014 1:45PM
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