Failed Oregon health exchange tab exceeds $25 million

Oregon has now moved to the federal health exchange, but that doesn't mean the financial troubles with the state's failed exchange are over.

Last spring, Oregon scrapped the Web portal for its state-based health exchange and shifted focus to the federally supported — but in the process, racked up at least $26 million in costs for the state.

The total bill for the project exceeds $300 million but has been predominantly paid for by federal funds. Most of those funds went to Oracle America Inc., which was initially tasked with building the Oregon portal that failed to launch in October 2013.

An Associated Press analysis found Cover Oregon has already cost more than $280 million in federal and state funds. But the spending doesn’t end there. According to the analysis, Oregon will still need to pay $30 million to adapt Kentucky’s Medicaid system for use in the state, though 90 percent of that would be covered by the federal government.


In addition, the state will pay an unknown amount to Oracle to host that Medicaid system until the end of 2015. The state will also invest an unknown amount to build a website for small businesses to find health insurance plans for its employees. The state is also due to pay an unknown amount to modernize the state’s social services computer systems and to pay fees to fight in the Oregon-Oracle legal dispute.

In the dispute between the state and the company, Oracle claims Oregon owes $23 million for costs associated with building the troubled exchange, while Oregon filed a lawsuit in August accusing Oracle of fraud, false claims, breach of contract and civil racketeering. In response, the state is seeking up to $5.5 billion in claims for damages, penalties and attorney fees.

Read more from the Associated Press via the Corvallis Gazette-Times.

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