Obamacare, the DMV, and complex systems

Consider the complex hardware and software systems that will be required to implement Obamacare.

If you think it is easy for governmental agencies to develop such complex systems even with the help of the most sophisticated systems houses, consider the experience of California when it tried to modernize its DMV systems with the help of HP. As reported by IEEE Spectrum:

Last week, on behalf of DMV's management, California’s CIO informed state legislators that it had decided to cancel at the end of January the remainder of its US $208 million, 6-year IT modernization project with Hewlett-Packard, which was supposed to be completed in May of this year. As reported in the LA Times, after spending some $134 million ($50 million on HP) and having “significant concerns with the lack of progress,” the DMV decided to call it quits and do a rethink of the program’s direction. HP had apparently seen the handwriting on the wall. Its contract ended last November, and HP refused to hire key staff until the contract was renegotiated.

The DMV IT modernization program was started in 2006 in the wake of a previous DMV project failure (called Info/California) that blew through $44 million between its start in 1987 and cancellation in 1994. That “hopeless failure,” as it was then described, was supposed to be a 5-year, $28 million effort; when it was terminated seven years in, the project’s cost to complete had skyrocketed to an estimated $201 million with an uncertain finish date. A 1994 LA Times story reported that an assessment found the DMV had limited experience in computer technology, grossly underestimated the project’s scope and size, and lacked consistent and sustained management.

The idea that all the computer systems required to implement Obamacare will be up and running smoothly by October is sheer fantasy. The recent announcements of delays in the implementation of Obamacare are just the beginning. Expect a steady drumbeat of additional postponements from the Obama administration as the implementation of Obamacare falls farther and farther behind schedule.

And, oh yeah. If the exchanges try to go on line in spite of poorly functioning systems, the complexity of the problem will only grow, since not only will the buggy systems still need to be fixed, but also the processing errors made by the buggy systems will subsequently have to be corrected, too.