In a story that has gone viral among conservative news sources, Michelle Malkin reports that while private health exchanges have operated smoothly and satisfied customers for decade, the Obamacare models are on “life support.” According to the Washington Post, almost half of these exchanges will suffer financial struggles despite $5 billion in federal subsidies.
Oregon’s exchange has been shuttered after government overseers squandered $300 million on their failed website, and shady consultants are under investigation by the FBI and other authorities. Hawaii’s exchange is demanding another $30 million cash infusion to remain financially viable after securing $205 million for start-up costs. Maryland has perhaps the most troubled exchange, improperly billing the federal government for over $28 million, after squandering $90 million on “technical issues.”
It blows my mind the magnitude of the waste here, this is simply not that complex an operation. I’ve managed design and development of software in much more complex environments, while still protecting valuable data (stuff hackers could steal and make millions from, so protection was a serious concern). There are multiple examples where small teams, just for the heck of it, set up a functionally similar system over a couple of weekends. I think my team could do the same.
You might say “oh but this has to handle millions of people!” OK, so you go to a hosting vendor with a good reputation like RackSpace, or maybe even the Amazon Cloud, and you pay a couple thousand a month for the processing power and bandwidth to support it. And lest you think this is a serious problem, your average Word Press site can easily handle a million database hits per month for about $100 per month. A system I manage can easily hande 40,000 sequences per day with multiple processing steps, in a hosting environment that costs about $70 per month.
Want security? Of course. The industry standard is Payment Card Industry Data Security Standard (PCI certification). This is the standard that large eCommerce sites must meet to store credit card information. I’ve been through this with a client, its very thorough and a pain in the butt. However it includes a major amount of penetration testing and checking by outside. This is the standard demanded by the major financial houses.
“Oh,” you might say, “but the code has to be checked and rechecked for software defects.” Ok there are companies that do that as well. There is a whole industry that supports due diligence in software design where experts go through your code line by line and make sure its up to best practices and is not hackable. Its expensive, but we are still not talking millions of dollars here.
You might also say “but oh, you have to take into account so many different factors to provide an insurance quote.” Yes, true. But aren’t insurance companies already doing this? Not like we have to re-invent the wheel…
In my book, to get the Rolls Royce of software packages might be in the $500,000 range in the private sector. In the government sector, add 200% to deal with the bureaucracy. In the entrepreneurial world, a prototype might cost $20,000 utilizing job exchanges and overseas labor (I was once told you could get a ‘white label functioning facebook’ for about $50,000). So lets compare the number $20,000, the entrepreneurs price, to $300,000,000 and $5,000,000,000 provided by the government. This should help you understand the magnitude of the waste here.
I have a lot of problems with Obamacare, mostly stemming from the socialist nature of it. This is just further proof of the ineptitude of the Obama administration in attempting to re-engineer American society.