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Generational Dynamics Web Log for 15-Oct-2013
15-Oct-13 World View -- Aetna CEO predicts Obamacare IT failures until 2017

Web Log - October, 2013

15-Oct-13 World View -- Aetna CEO predicts Obamacare IT failures until 2017

Assad says loss of chemical weapons a blow to Syria's morale

This morning's key headlines from

Aetna CEO predicts Obamacare IT failures until 2017

Aetna CEO Mark Bertolini
Aetna CEO Mark Bertolini

As I wrote yesterday ( "14-Oct-13 World View -- IT systems a continuing disaster"), the Obamacare IT systems are a continuing technical disaster, much worse than the "glitches" that the administration are describing. It now turns out that the technical issues are much more serious than even I realized.

Mark Bertolini, the CEO of insurance company Aetna Inc., has been personally involved in the implementation of Obamacare from the beginning, from both a policy and an IT perspective, and he's always been a supporter of Obamacare, albeit perhaps a reluctant one.

Bertolini was interviewed on CNBC on Monday, and his technical assessment of the Obamacare web sites is that they're so bad they won't be fully working until 2017.

Since yesterday, several people have written to me to complain that I was being too negative about the Obamacare web sites, and I didn't really know, since I wasn't involved in their development. But that's not true of Bertolini, who knows as much as anyone in the country about what's going on.

I transcribed the interview. Questions from the interviewers are enclosed in [brackets]. Bertolini was first asked if he knew from the beginning how bad it would be:

"We were one of the alpha testers. We got pretty nervous as we got further along. We helped them build blueprints, on how to put the system together, and as they started missing deadlines, we were pretty convinced that it was going to be a difficult launch.

[Did you tell them - don't do this - move the date?]

We started to help them prioritize how to move ahead with the project. They have their perspective on when they wanted to start, so we did our very best to help them get started on time. ...

[How long will it take to actually get them fixed to work, get out all the kinks?]

That is a big question. When you implement a project of this size, the first thing you do is unit testing, then you do application testing, then you do integration testing, and then you do scalability testing. And that plan is usually a lot longer than some of the application development itself. That's happening on the fly.

[It wasn't done beforehand?]

All of it's been on the fly. We didn't get code drops until a month before the system went live from a user testing standpoint."

This is already devastating. Yesterday I was criticizing the contractors who implemented the web sites as incompetent, and this proves it. For a full-scale rollout of such a large system on October 1, any competent IT manager would have provided testable code several months earlier. As Bertolini says below, this should be career ending for the people involved.

"So if you think about ... you don't know what scalability issues you have until you have all the functionality working, and everybody starts hitting the system, so you've actually gotta get the functionality up, and the integrated testing working, cause you don't know how many files you're going to hit, how many people are going to hit them, until you get it working together. And then scalability is the last thing you size.

[What happens January 1 - if people are having troubles now - if it's that bad of a situation, is everyone going to be able to sign up by January 1?]

No, and that's why enrollment is gonna still be open until March 31. But I think the bigger issue is whether enough people will be able to sign up to make it work.

[You need buy-in by a lot of people -- need a lot of young people.]

I think the attention span of the younger generation in using technology - if it doesn't work the first time, it's going to be pretty tough to get them back the second time. And so as a result, with the web site technology, we are actually testing it with the types of users who we want to use it.

[So there's not much time to get it right.]

It's the law of the land, number one. Number two, public exchanges are gonna be here to stay, so we need to make them work somehow. And I think the question is how we get there from here.

[The six months between now and March 31 - that's not a long time - to do all of the testing and prototyping and evaluation and scalability of the system this large. Is that enough time, in your judgment?]

I don't know. We're in a place now where there's so much wrong, you just don't know what's broken until you get a lot more of it fixed. And we have to plow through it. I've been here one or two times in my career, it's nothing you ever want to repeat, cause it's very difficult. It's a career ending event in a lot of cases.

[Taking the politics out of it -- Are you worried that if it's delayed a year - once you get people into an entitlement, you never get them out, so you wanted to get started, right?]

If the program blows up because people don't sign up, then the program's not going to move ahead either for all that while.

So this is gonna be a three year thing.

[Should they delay it by a year?]

I would have [delayed it], if I'd been in their seat. So the politics got in the way of a good business decision.

So this is gonna be 2017-2016-2017 before it grows. I think the bigger issue for folks to think about is that private exchanges have now kicked off, as a result of the private sector innovating against the law. And as these private exchanges move ahead, and they're very good experiences in a lot of cases, we'll be launching a number of them, we'll be in 15 this year alone, what will happen is that you'll start to attract people to a different kind of marketplace. What will do in juxtaposition to the public exchanges over time, and how will that work?"

The important points in Bertolini's interview are these: Almost no testing has been done; he would have delayed implementation for a year; it's going to take three years to get it working.

I've been a Senior Software Engineer for decades, and I've been a technology journalist for almost as long, so I'm very well aware of what's going on here. I've been a personal participant in several IT disasters, and I've been an outsider reporting on several IT disasters, and I can tell you that this smells to high heaven like an IT disaster.

There are two kinds of IT projects. One kind is like digging a ditch. You know that if you keep digging, you'll eventually get the ditch dug. It may take longer than expected, but sooner or later it will always end successfully, because there's no real risk.

The second kind of IT project is like building a bridge, and the risk is extremely high. You can keep building, but if one day the entire bridge collapses and falls into the river, then you have no choice but to either start over or just abandon the project. The Obamacare web sites are in this category.

This project should have cost $10-25 million, as I described yesterday, but it's already cost an astronomical $93.7 million. Now the Obama administration has to decide whether this "bridge," which is in the process of collapsing into the river, should be repaired, or whether the project should be started from scratch. It's quite possible that there's no choice but to start it from scratch. But either way, it's going to cost many more tens of millions of dollars to get working, if it ever works. And the Obama administration is so desperate to save Obamacare, they'll do anything, no matter how desperate the action.

There's one more thing worth noting: Bertolini talks about "private exchanges" that are springing up in competition with the federal exchanges. This is a very interesting development worth watching. CNBC

Assad says loss of chemical weapons a blow to Syria's morale

It's always nice to know that even genocidal maniacs can have a sense of humor, so it's worth a chuckle that Syria's president Bashar al-Assad said that he should have been a winner of the Nobel Peace Prize. Actually, I've made the same suggestion in the past - that he deserves the prize by exterminating as many innocent people as possible, so there's no one left to fight a war.

However, it's possibly more interesting that al-Assad, who until recently denied that he had chemical weapons, is now saying that losing them would be a loss of morale for all of Syria:

"There is no doubt that the loss of chemical weapons has resulted in a loss of morale and a political loss for Syria. Since 2003, Syria has demanded that the countries in the region dismantle their WMDs, and the chemical weapons were meant to be a bargaining chip in Syria’s hands in exchange for Israel dismantling its nuclear arsenal.

The chemical weapons, which have lost their deterrent value over the past few years, were meant to be used only after Israel used its nuclear weapons.

Today the price has changed and we have agreed to give up our chemical weapons to remove the threat of the US attacking us."

So why are they a loss of morale for Syria? Because: "Israel would distribute gas masks to its citizens when there was a rise in tension in the region." Jerusalem Post

EU officials demand more privatization from Greece

Greece was first bailed out for 110 billion euros in 2010 but when that failed, it got a second rescue in 2012 worth 130 billion euros plus a private sector debt write-off totaling more than 100 billion euros. But it still isn't enough. Greece would like to issue bonds in 2014 for 4.4 billion euros, to pay for debts that will come due next year, but Greece's debt is already 175% of annual output, and so European officials are refusing to permit Greece to go even deeper into debt. So there's still a 4.4 billion euro funding gap in 2014, which will have to be made up somehow, and an ECB executive board member puts the figure at 6 billion euros. Instead, the ECB is demanding that Greece sell off more government assets, and privatize more government run businesses. At any rate, European officials will not make any decisions until December. Kathimerini and AFP

(Comments: For reader comments, questions and discussion, see the 15-Oct-13 World View -- Aetna CEO predicts Obamacare IT failures until 2017 thread of the Generational Dynamics forum. Comments may be posted anonymously.) (15-Oct-2013) Permanent Link
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