5 Companies Integral to Fixing the Obamacare Website

The numbers are in... and they're ugly.

According to internal memos released by the House Oversight Committee late last week, Obamacare's website, Healthcare.gov, managed to successfully enroll just six people on the first day it went live. After two days, only 248 people had successfully completed enrolling for health insurance. Keep in mind these aren't figures for a single state -- we're talking about a network of 36 states where only 248 people successfully managed to navigate a number of glitches and enroll for health insurance.

If that weren't enough, the administration has previously stated that 4.7 million unique people visited the site on the first day of its launch for an enrollment success rate, based on this internal memo, of a paltry 0.00000128%.

Of course, it should also be noted that things have improved somewhat since Healthcare.gov launched with the combination of state and federally run exchanges totaling 700,000 applications (not to be confused with enrollments) in just under the first four weeks. This doesn't tell us how many of these applications are completed, but it clearly shows growing interest by the public in obtaining health insurance, as well as improving awareness of the law.

Priority No. 1 right now, though, is fixing Healthcare.gov. According to spokesperson Jeffrey Zients, the end of November is the current timetable officials are targeting as to when Obamacare's website will be running smoothly for a majority of people. That might seem like an eternity away, and it's certainly increasing calls for delaying the full implementation of the individual mandate which is set to go into effect on Jan. 1, but a pushback is probably not needed given that sign-ups were expected to be very back-loaded toward the coverage cutoff date of March 31, anyway.

Instead, every able body appears focused on fixing millions of lines of source code and getting as many forward-thinking companies on the job as possible. That's why I felt it important to take a look at five companies that will be the most integral to fixing the numerous glitches currently plaguing Obamacare's website, Healthcare.gov, and see if their involvement in this process could be a boon, or bust, for shareholders.

CGI Group
Just in case you thought CGI Group (NYSE: GIB  ) was going to get a free pass, think again. Canada's CGI Group is the primary architect behind Healthcare.gov and, as such, can probably contribute more than anyone to fixing its many errors.

On one hand, CGI Group's revenue received from this project may only climb despite the inherent screw-ups, given how little time it claims the Department of Health and Human Services allotted for testing of the website prior to launch. According to NBC News as of two weeks ago, the cost to build the Obamacare website had already skyrocketed to three times more than the original estimates by May! The assumption is that we could be well beyond five or even 10 times the original estimates by the time the website is functioning properly.

But there's a downside to this debacle for CGI as well. The ongoing glitches could be a blow against the company's reliability which has obviously been put under a microscope over the previous couple of weeks. Last year, CGI had a diabetes registry contract pulled that it was originally awarded by eHealth in Ontario, for reportedly failing to meet numerous deadlines. If CGI doesn't fix things quickly, it could translate into the possibility of lost future orders.

Quality Software Services
Quality Software Services, better known as QSSI, which is owned by UnitedHealth Group (NYSE: UNH  ) , isn't getting off scot-free, either. QSSI is already an integral part of Healthcare.gov's build-out, as it's responsible for ensuring that all of the health insurance plans being offered remain in compliance with the laws of the Patient Protection and Affordable Care Act (which you probably know better as Obamacare).

Just two weeks ago, though, we learned that QSSI will be taking the reins from the Department of Health and Human Services and directly handling the technical oversight and implementation of all fixes. In other words, this is QSSI's show to win or lose. Being a division of UnitedHealth's subsidiary Optum, UnitedHealth shareholders are unlikely to see any direct share price action from QSSI's involvement, but clearly getting the Obamacare website working is going to be good news for all insurers who are eager to sign up new members.

The three (tech) amigos: Oracle, Google, and Red Hat
Finally, we have what is being referred to as the "tech surge," whereby representatives from Oracle (NYSE: ORCL  ) , Google (NASDAQ: GOOGL  ) , and Red Hat (NYSE: RHT  ) have officially been identified as companies called upon to assist in the fixes.

I believe Google is being brought in for its out-of-the-box thinking. Google is a genius when it comes to rolling out network fixes across its entire network, and it's incredibly smart when it comes to security. It's a rare day when Google's network has gone down -- and when it's happened, it rarely lasts longer than a few minutes.

Oracle and Red Hat are going to serve a similar purpose, working toward improving system reliability and scalability. Both Oracle and Red Hat are well known for their middleware software that allows them to deploy and manage applications via the Internet or the cloud.

For Google, joining the Obamacare website fix probably isn't a big deal, but for the struggling Oracle and Red Hat, this news could be just what these two companies need to boost sales and enterprise confidence in these two middleware developers.

Who's next?
Rumors abound as to which company could be called upon next to help fix Healthcare.gov. Two weeks ago, USA Today commented that Verizon was going to be next in line to help out, yet no official word has come from regulators as to whether that's going to come to fruition.

Instead, I would look to companies with enormous databases such as Facebook or even Netflix to be called upon to offer their expertise in the immediate future. Understand, this is pure speculation on my part, but both Facebook and Netflix have demonstrated success in rolling out global upgrades to a network that's considerably larger in size than Healthcare.gov.

Moving forward, it's very unlikely that Oracle, Google, and Red Hat are going to be the last high-profile companies called in to help fix Healthcare.gov. I'd also contend that it's probably going to take the entire month of November to get the system running smoothly, given the scope of the problems that have been detailed up until now. In other words, the Obamacare website waiting game continues.

Does Obamacare still confuse you? Let us help!
Obamacare seems complex, but it doesn't have to be. In only minutes, you can learn the critical facts you need to know in a special free report called Everything You Need to Know About Obamacare. But don't hesitate, because it's not often that we release a free guide containing this much information and money-making advice. Please click here to access your free copy.


Read/Post Comments (6) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 03, 2013, at 8:39 PM, EdHamox wrote:

    First Lady Michelle Obama’s Princeton classmate is a top executive at the company that earned the no-bid contract to build the failed Obamacare website.

    Toni Townes-Whitley, Princeton class of ’85, is senior vice president at CGI Federal, which earned the no-bid contract to build the $678 million Obamacare enrollment website at Healthcare.gov. CGI Federal is the U.S. arm of a Canadian company.

    Townes-Whitley and her Princeton classmate Michelle Obama are both members of the Association of Black Princeton Alumni.

    Toni Townes ’85 is a onetime policy analyst with the General Accounting Office and previously served in the Peace Corps in Gabon, West Africa. Her decision to return to work, as an African-American woman, after six years of raising kids was applauded by a Princeton alumni publication in 1998

    George Schindler, the president for U.S. and Canada of the Canadian-based CGI Group, CGI Federal’s parent company, became an Obama 2012 campaign donor after his company gained the Obamacare website contract.

    On the government end, construction of the disastrous Healthcare.gov website was overseen by the Centers for Medicare and Medicaid Services (CMS), a division of longtime failed website-builder Kathleen Sebelius’ Department of Health and Human Services.

    CGI Federal did not immediately return a request for comment.

    _______________________________________________

    Soooooo...........

    Lets see if we can connect the dots here ...

    1.) No American companies considered

    2.) A Canadian company hired

    3.) No Bid contract for 93 million dollars ...

    4.) Top executive at Website building firm went to school with Michelle Obama.

    5.) Previous experience building gun registry for canadian government

    6.) Fired by Canadian Government for overruns that cost Canada 100 millions dollars.

    4.) Overruns for Obamacare enrollment website now costing U.S. $678,000,000.00 = $678 Million dollars

    Does this bother anybody else besides me? And this is just one of their corrupt enterprises. The Obama's are worse than "Bernie" Madoff and far more dangerous to the country. These thieves and traitors should be in jail for the rest of their lives.

  • Report this Comment On November 03, 2013, at 10:37 PM, ObamasTwin wrote:

    How many leftists Silicon Valley Giant Rich 1%ers does it take to screw in a light bulb? Or how many does it take to screw this country for the bidding of this leftist dicktator?

  • Report this Comment On November 04, 2013, at 6:35 AM, Pakirk53 wrote:

    Hey Motly how about posting a running ticker showing intial cost of web site and daily growing cost so taxpayers can see first hand what government incompetence costs them.

  • Report this Comment On November 05, 2013, at 12:36 AM, Frankie581000 wrote:

    Obamatwin...There were NO american companies in the building of the site......NOW they are going to possibly "eat crow" and ask the real experts on how this "should" have been built, which they should have done from the get go...

  • Report this Comment On November 05, 2013, at 6:57 AM, Widowmaker6 wrote:

    obamaz is a failure - wOrst president EVER

  • Report this Comment On November 06, 2013, at 3:55 PM, jammerh wrote:

    "No American companies considered",

    Really? Do you know this for a fact? Seems to me these things are put out for tender and the agency chooses the bidder offering what is considered the best value. CGI Federal is a well-known Canadian company with international operations. Are you also advocating that Canadians not buy from American companies? After all it cuts both ways. Americans can hardly go around the world selling their aircraft, hamburgers and other goods while at the same time telling people in those countries, "but by the way, we really don't want to buy anything from you..."

    "...went to school with Michelle Obama..." should anyone associated with anyone related to government be banned from doing business with the government agencies? How far would you take this line of reasoning? Anyone who went to high school...anyone related to a cousin of a member of gov't...

    "previous experience building gun registry..." huh?

    CGI has a wide range of experience building a lot of websites for a wide range of industries including government agencies.

    "Fired by Canadian Government for overruns that cost Canada 100 millions dollars."

    You're a wealth of misinformation. No one was fired. Ontario, not the government of Canada, had problems with CGI not meeting deadlines to its satisfaction. As a result it gave the work to someone else.

    This can happen from time to time when you're working on a lot of projects at the same time. Why not mention the long list of successfully completed contracts and satisfied customers?

    Canada is America's largest trading partner. Not Japan, China, Mexico, or anyone across the sea. It's little old Canada. America has more trade with Canada than any two countries in the world. American companies dominate the Canadian economy. Many US jobs are contingent upon trade with our northern partner.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2710921, ~/Articles/ArticleHandler.aspx, 9/30/2014 10:11:14 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement