Online Obamacare Exchange: A $634 Million, Glitch-Ridden Privacy Concern


To the amusement of conservatives and to the frustration of supporters trying to sign up, Obamacare insurance exchange websites throughout the Nation have been plagued with technical glitches since going online last week.

The sites under the care of continually rejects user logins, fails to load drop-down menus and provides an overall unenjoyably glitch-ridden user experience, according to the accounts of many who have attempted to sign up. Obama Administration officials have blamed the problems on overwhelming popularity and, last weekend, ordered major renovations intended to make the sites function properly.

But new reports indicate that popularity has less to do with the glitches than failure on the part of the government.

According to Digital Trends, the site failures are mostly to blame on poorly written computer coding that could not handle traffic once the sites went online. The report also notes that the code was not only poorly written, but that it was also very costly.

Via Digital Trends:

The exact cost to build, according to U.S. government records, appears to have been $634,320,919, which we paid to a company you probably never heard of: CGI Federal. The company originally won the contract back in 2011, but at that time, the cost was expected to run “up to” $93.7 million — still a chunk of change, but nothing near where it ended up.

Given the complicated nature of federal contracts, it’s difficult to make a direct comparison between the cost to develop and the amount of money spent building private online businesses. But for the sake of putting the monstrous amount of money into perspective, here are a few figures to chew on: Facebook, which received its first investment in June 2004, operated for a full six years before surpassing the $600 million mark in June 2010. Twitter, created in 2006, managed to get by with only $360.17 million in total funding until a $400 million boost in 2011. Instagram ginned up just $57.5 million in funding before Facebook bought it for (a staggering) $1 billion last year. And LinkedIn and Spotify, meanwhile, have only raised, respectively, $200 million and $288 million.

The expensive, glitch-ridden website also comes with serious privacy flaws. Social Security Commissioner Michael Astrue recently described the online Obamacare exchanges as an “overly simplistic system without adequate privacy safeguards,” leaving exchange enrollees “open to identity theft, lost periods of health insurance coverage, and exposure of address for victims of domestic abuse and others… the beta version [of the exchanges] jammed through a few months ago will, unless delayed and fixed, inflict on the public the most widespread violation of the Privacy Act in our history.”

Personal Liberty

Sam Rolley

Sam Rolley began a career in journalism working for a small town newspaper while seeking a B.A. in English. After covering community news and politics, Rolley took a position at Personal Liberty Media Group where could better hone his focus on his true passions: national politics and liberty issues. In his daily columns and reports, Rolley works to help readers understand which lies are perpetuated by the mainstream media and to stay on top of issues ignored by more conventional media outlets.

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  • Paul

    I wonder why CGI was selected to develop the exchanges. They appear to be a Canadian company. Does Obama have another Solyndra on his hands? Follow the money!

    • Vigilant

      CGI was selected because it is “a Canadian tech firm that has provided service to that country’s single-payer health care system…The company is deeply embedded in Canada’s single-payer system. CGI has provided IT services to the Canadian Ministries of Health in Alberta, British Columbia, New Brunswick, Quebec and Saskatchewan, as well as to the national health provider, Health Canada, according to CGI’s Canadian website.”

      It has received over $1 billion in contracts from DoD, GSA, HHS and the Justice Dept. So much for keeping government business within the USA to feed US citizens. Obama seems to enjoy helping the Canadian economy in lieu of ours.

      It may be significant that CGI is behind the IT of the Canadian single payer system. Were they hired because Obama & Co. knew that, notwithstanding his promises to the contrary, the ACA would kill employer health plans and drive folks to the gov’t plan? That is, was CGI contracted because they were comfortable with the software requirements of a single payer plan?

  • Leather neck

    Right out of Lenin’s play book,control the people’s health care,you control the people.Next step gun registration then confiscation.
    The republicans are doing a lousy job of overcoming the lies,distortions of the

    • smilee

      They lack the power as the voters gave more power to the democrats. A reality the republicans refuse to accept

  • Warrior

    If even 1 person successfully signs up, that will be sufficient for the “progressives” to call this a huge success and then the “floodgates” of fed money will open up to ensure it. Come and get your “subsidies”!

  • nobaloneyhere

    The way this so-called health plan is working, you’d swear it was drawn up on a paper napkin at a fast-food restaurant.

    • smilee

      It will work, When they put Medicare C and D plans on the net they had many problems too and now it runs smoothly.

  • Bill from Colorado

    How much does Walmart, Ebay, or Amazon spend continuously on their sites? They always run and are secure, it doesn’t matter what time of year. I’m interested in what this monstrosity will cost just to maintain every time web browsers update or banks change security for transfers… I don’t think the initial price tag will be any where near what it will cost to run everyday.

  • Michael Shreve

    The law of INTENDED consequences.

  • debsaid

    I wish there was this much uproar against corporate welfare and subsidies…. *sigh*

    • blissnsmiles

      This IS corporate welfare. And the new one is coming: The Trans Pacific Trade Agreement

    • smilee

      Right On!!


    Oklahoma Suit May Knock Out Obamacare…

    Why didn’t anyone else think of it?

    Scott Pruitt, the Attorney General of Oklahoma, acting on the research of Jonathan H. Adler and Michael F. Cannon published in the Case Western Reserve School of Law Journal, has brought a new lawsuit, on behalf of the state, against Obamacare.

    Unlike the suit brought by 26 state attorney generals, this suit does not make a constitutional objection to the Affordable Care Act. Instead, it uses the language of the law to challenge the elaborate system of subsidies, tax credits, and individual or employer mandates and fines the act has spawned.

    Adler and Cannon studied the actual text of the law — something Congress never did — and found that it explicitly provided that subsidy only to those who got their insurance through state exchanges. Indeed, the subsidies and tax credits were intended to be the carrot that induced states to set up exchanges rather than force the feds to set up their own.

    The IRS has ruled that the language of the statute should be “interpreted” to extend the subsidies to those enrolled in state or federal exchanges, but that’s not what the law says. Section 1401 of the act, according to their article “authorizes premium-assistance tax credits and makes the available only through state-run exchanges.”

    The section says that taxpayers may receive a tax credit only if “the taxpayer is covered by a qualified health plan … that was enrolled in through an exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act.”

    Adler and Cannon argue that “by its express terms, this provision only applies to exchanges “established by a state” and “established … under Section 1311.” Section 1401 further emphasizes that tax credits are available only through Section 1311 exchanges.”

    The IRS and defenders of the legislation try to stretch the language to imply a mandate to cover those in federal exchanges. IRS director Douglas Schulmann, answering a letter from Republican Congressmen about whether the subsidies are limited to state exchanges, wrote:

    “The statute includes language that indicates that individuals are eligible for tax credits whether they are enrolled through a state-based exchange or a federally-facilitated exchange.”

    Unfortunately for President Obama, the statute implies no such thing. It is not only silent on any subsidies for federal exchanges, it is clear that the subsidies were intended to encourage states to set up exchanges.

    The Oklahoma suit has survived a motion to dismiss and its standing to bring the suit has been affirmed by the District Court. Attorney General Pruitt hopes for a judgment later this year and feels the case might reach the Supreme Court by late next year.

    • smilee

      This is just another law suit filed for political reasons and not legal ones. It will fail as all the others filed under that pretense have. Obamacare is here to stay, they will make some changes in congress to improve it over time. but nothing else. But dream if you like but most likely if your dream long enough it will become your nightmare.