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White House reveals key flaw in Obamacare website

Wednesday, 23 Oct 2013 | 6:38 PM ET
Health care CEOs at the White House today
Wednesday, 23 Oct 2013 | 3:00 PM ET
Mark Bertolini, CEO of Aetna; Bruce Broussard, the CEO of Humana; Chet Burrell, CEO of CareFirst; Patrick Geraghty, CEO of BlueCross BlueShield of Florida; Jay Gellert, president and CEO of Health Net, Inc.; Patricia Hemingway Hall, president and CEO of Health Care Services Corporation; Daniel J. Hilferty, president and CEO, Independence Blue Cross; Karen Ignagni president and CEO, America's Health Insurance Plans; Michael Neidorff, chairman and CEO of Centene Corp.; James Roosevelt, president and CEO, Tufts Health Plan; Scott Serota, president and CEO, Blue Cross Blue Shield Association; Joseph Swedish, CEO, WellPoint; Bernard Tyson, CEO, Kaiser Permanente, all appeared at the White House today to talk to the President about the rollout of Obamacare.

Leading insurance company CEOs met Wednesday at the White House with top Obama administration officials to discuss solving the serious tech problems afflicting the new federal Obamacare insurance marketplace, specifically the ones that are drastically crippling enrollment.

In a statement after the meeting, the White House said "we are collaborating very closely with the insurers to address problems we have witnessed in what are called '834' forms and in direct enrollment."

Those 834 forms contain information about individuals that insurers then use to officially enroll that person in health-care coverage.

CNBC and other media outlets have extensively detailed how many if not most of the 834 forms being transmitted each night to insurers from HealthCare.gov contain corrupted or questionable data that prevent people from being enrolled quickly, or even at all. But the Obama administration to date had been vague about the specific issues plaguing HealthCare.gov.

"We haven't seen any improvement in the 834s," said a top executive at one of the 13 insurance companies whose CEO was at the afternoon meeting with embattled Health and Human Services Secretary Kathleen Sebelius, White House Chief of State Denis McDonough, Director of Centers for Medicare and Medicaid Services Marilyn Tavenner and top Obama advisor Valerie Jarrett.

"The data's pretty bad," the executive said. And even if the data was not corrupted, the number of enrollments the insurers are getting from HealthCare.gov is "pretty low."

(Read more: Low-Bamacare numbers)

The White House said, "To that end, we have worked with the insurers and the 'alpha teams' we jointly established, made up of insurers' technology experts and CMS technology experts to iron out kinks in both the 834 forms and in direct enrollment."

This is part of the "tech surge" President Barack Obama described earlier in the week. The administration now says the plan is "incrementally improving performance at HealthCare.gov."

"These 'alpha teams' are working side-by-side to correct challenges as soon as we see them," the White House said. "The teams have been meeting virtually with CMS and [lead HealthCare.gov contractor] CGI and with the tech teams associated with operations leaders on the industry."

The meeting came as testimony was being submitted to the House of Representatives Energy and Commerce Committee, who will hold a hearing on the troubled rollout Thursday.

In that testimony, CGI identifies early problems in another contractor's software as a cause of some of the initial problems. That contractor, UnitedHealth Group unit Quality Software Services also said there were late changes to the registration process that also caused problems.

(Read more: CGI blames another contractor for Obamacare site glitches)

A spokesman for America's Health Insurance Plans, the industry's trade group, after the meeting said, "This was a positive and productive meeting in which the CEOs were able to provide on-the-ground perspective of how open enrollment is proceeding."

"Our industry is committed to working with the administration to help ensure individuals and families are able to get the health care coverage they need," said AHIP spokesman Robert Zirkelbach, whose president and CEO Karen Ignagni attended the White House meeting.

Also there were Aetna CEO Mark Bertolini, Humana Chief Bruce Broussard, Chet Burrell of CareFirst, Patrick Geraghty of Blue Cross Blue Shield of Florida, Jay Gellert of Health Net, Daniel Hilferty of Independence Blue Cross, John Molina of Molina Healthcare, Michael Neidorff of Centene, James Roosevelt of Tufts Health Plan, Scott Serota of the Blue Cross Blue Shield Association, Joseph Swedish of WellPoint and Bernard Tyson of Kaiser Permanente.

Source: Heathcare.gov

The session came a day after Jeffrey Zients, the former acting director of the Office of Management and Budget, was assigned to oversee the round-the-clock, frantic push to correct the many software problems on HealthCare.gov, which is being operated by HHS.

(Read more: Obamacare gains support despite glitches)

Zients' appointment follows scathing criticism of HHS' handling of the rollout of the site by both Republican opponents of Obamacare and supporters of the health-care reform effort. The appointment was seen as the White House taking a leading role in solving the problems, which threaten to cripple the president's signature legislative victory.

On Tuesday night, Sebelius, who has rejected Republican calls for her resignation, told CNN that Obama had not been told about software problems with that website until after it launched Oct. 1, when those problems began making headlines nationally.

Time to delay?

The problems at HealthCare.gov have led to renewed calls for a delay of the so-called individual mandate, which requires nearly all Americans to obtain some form of health insurance by 2014 or face a tax penalty.

Earlier Wednesday, Sen. Jeanne Shaheen (D-N.H.), became the first leading Democrat to call on the Obama administration to extend the open enrollment period of the Obamacare insurance policies past March 31. Several other senators quickly followed suit, and CNN quotes one Democratic party source as saying every Democrat running for office next year will support that idea, which so far is being rejected by the White House.

But also on Wednesday, an HHS official told CNBC.com that it is currently "exploring options" to resolve "a disconnect between the open enrollment and the individual responsibility time frames in the first year of the marketplace." That disconnect is the fact that the Affordable Care Act allows people to enroll in coverage until March 31, 2014, but effectively requires people to sign up and begin paying for coverage by about Feb. 15, 2014, in order to avoid the tax penalty.

"The administration is working to align those policies and will issue guidance soon," the official said.

White House press secretary Jay Carney said the Centers for Medicare and Medicaid Services, the HHS division that is operating HealthCare.gov, will begin giving reporters regular briefings about the site. That development comes after three weeks of news stories that were critical of the site, and which often contained little new information from HHS other than statements that the problems were being addressed.

(Read more: 'Months' not years to fix HealthCare.gov: former Oracle boss)

Aetna CEO: Convinced Obamacare would be difficult launch
Mark Bertolini explains why he was nervous about the Affordable Care Act rollout and his concerns about whether enough people will sign up to make the program work.

Insurers, including the ones attending the White House meeting, are hoping that enough younger, healthier people enroll in the plans being sold on HealthCare.gov to offset what is expected to be a flood of older, sicker people who previously have been unable to obtain affordable insurance because of their pre-existing conditions.

If not enough people enroll in the plans, insurers could actually lose money on selling the coverage, and be forced to significantly raise prices for 2015, which could in turn dampen adoption of the Obamacare plans by many people.

HealthCare.gov is selling insurance from competing plans to people in the 36 states that are not operating government health insurance marketplaces on their own.

The North Dakota online publication Inforum on Tuesday quoted a Blue Cross Blue Shield of North Dakota spokesman as saying just 14 state residents have signed up with that insurer, the largest in the state, since the Oct. 1 launch of HealthCare.gov. Only six other people in North Dakota have signed up with other carriers, according to Inforum, which noted that means an enrollment rate of less than one person per day.

Blue Cross Blue Shield official James Nichol, speaking at a public meeting in Fargo on Monday, revealed that earlier that same day the federal government had asked the insurer not to reveal enrollment figures.

The Washington Post on Tuesday reported that CMS director Tavenner earlier that same day had told directors of state Medicaid agencies that HealthCare.gov is still not able to electronically enroll people in Medicaid, which is the government health insurance program for many poor people.

(Read more: The GOP's go-to guy on Obamacare fixes? Former fugitive John McAfee)

CMS had said right before the launch of HealthCare.gov that Medicaid electronic enrollment would be delayed until Nov. 1. But now, Tavenner reportedly told the Medicaid directors there is no set date for it to begin working.

In addition to the electronic hurdle for Medicaid applicants, Spanish-language applicants still cannot enroll in Obamacare insurance electronically, and are being referred to HealthCare.gov's toll-free customer service phone number to enroll.

By CNBC's Dan Mangan. Follow him on Twitter @_DanMangan

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