Oregon Seeks to Sue Oracle over Health Exchange

Gov. John Kitzhaber asked Oregon’s attorney general to sue Oracle on Thursday. Oracle is the contractor responsible for building the state’s health exchange, oft-derided Cover Oregon, which we’ve covered previously.

Oregon attorney general Ellen Rosenblum will develop “immediate” legal action, after Gov. Kitzhaber revealed he has fired state managers in charge of Cover Oregon. Her legal team is already reviewing options and developing strategies to sue Oracle, according to the Associated Press.

This is a very serious decision taking on a very large corporation — the second-largest software corporation in the world — but I do not believe they’ve delivered for the state of Oregon.

Oracle as paid over $134 million in federal funds to build the site. Responding to the claims, Oracle denies responsibility:

Contrary to the story the State is promoting, Oracle has never led the Oregon Health Exchange project. OHA (the Oregon Health Authority) and Cover Oregon were in charge and badly mismanaged the project by consistently failing to deliver requirements in a timely manner and failing to staff the project with skilled personnel.

The governor is trying to shift blame from where it belongs, the company said, adding it is confident an investigation would “completely exonerate Oracle.”

This isn’t the first time Oracle has defrauded government officials on a software contract. In 2011, Bloomberg reported that Oracle paid “more than $199.5 million to settle allegations it overbilled the US Government for nine years.”

Add in the hundreds of insurance brokers who have partly or not been paid in the past five months or more and Gov. Kitzhaber faces challenges during his re-election bid this year.

With the incoming Department of Health Human Services (HHS) nominee, Sylvia Burwell, vowing to recover any misspent federal funds at failed state exchanges, it’s likely that Oracle, Gov. Kizthaber,and HHS Chief Burwell will be in litigation this year.