Red flags over Cover Oregon spending go back to 2011

Red flags over Cover Oregon spending go back to 2011 »Play Video
This is a still image from one of the Cover Oregon television ads running on local TV stations. According to the ad agency that created the commercials, the two most well-known ads cost between $100,000 and $160,000 to make.

PORTLAND, Ore. - The independent review of what went wrong with the Cover Oregon website gets underway Tuesday.

The state has hired a company called First Data to run the review, something Governor John Kitzhaber ordered three months ago.

Among some of the questions the review will try to answer: Who knew what about the failure? When did they know it? And where did the millions of taxpayer dollars go that were used to build the website?

Cover Oregon is the most expensive IT project in state history. Designing and building its website was initially funded with $48 million dollars in federal grant money back in 2010.

Fast forward three years, and project managers have convinced the federal government to grant an additional $172 million in taxpayer dollars to keep the project going.

What does the state have to show for it now? The website still has more than a dozen critical coding errors, and has failed to enroll a single Oregonian in a private health insurance plan.

And now, KATU News has uncovered new questions about how some of those millions were spent.

The money management of Cover Oregon raised red flags for a company called Maximus, which was hired by the state to provide independent oversight of the project and deliver monthly quality assurance reports starting in November 2011.

In a report dated Oct. 3, 2012, Maximus puts the budget for the state health insurance exchange in a "high risk" category.

The report warns quote: "Current invoicing by major contractor lacks sufficient detail to fully represent all detail of the work performed…"

The major contractor was Oracle.

A month earlier, non-partisan state IT analyst Dr. Bob Cummings had raised similar concerns about Cover Oregon's money management. He sent an email to Dr. Bruce Goldberg, the head of the Oregon Health Authority.

Cummings wrote: "External folks will also begin to review how money has been spent on (the health insurance exchange), so I'd definitely have documentation showing how funds have been utilized."

Then Cummings took his concerns a step further. On Oct. 22, 2012, he sent an email to Carolyn Lawson. She was the Chief Information Officer for Cover Oregon, and in charge of the project's purse strings.

Full coverage of the troubled Cover Oregon website: