Ex-head of troubled health insurance site developed by Oracle may sue, citing 'cover-up'

State officials allegedly tried to shift blame for Cover Oregon's woes to Oracle and the ex-health authority CIO

The former CIO for Oregon's troubled health care insurance website is alleging that state officials engaged in a "substantial cover-up" meant to deflect blame away from themselves and onto herself and the project's contractor, Oracle.

Carolyn Lawson, who was forced to resign in December, this week filed a tort claim notice, which is a required precursor to filing a lawsuit against the state.

Lawson oversaw the initial development of Cover Oregon, the state-level exchange created in connection with President Barack Obama's national health care policy reforms. The site was supposed to go live Oct. 1 but has been racked with problems, with no clear resolution to all its issues in sight.

The letter names a number of potential defendants, including Tina Edlund, acting director of the Oregon Health Authority; former OHA communications director Patty Wentz; acting Cover Oregon director Dr. Bruce Goldberg; and ex-Cover Oregon director Howard King.

Cover Oregon's failed launch has resulted in an "intense and prolonged" public and political firestorm, the tort claim notice letter states. Those officials and others "responded to the criticism by organizing, encouraging, allowing, tolerating and/or engaging in a substantial cover-up" meant to protect "selected individuals" while "unfairly and untruthfully pointing the finger at others," including Lawson, adds the letter, which was obtained by the Oregonian newspaper.

Lawson became CIO at the OHA in July 2011. After the failed launch, Wentz told her to "refrain from telling the 'real story'" in public, as well as make false and misleading statements, according to the letter.

Although Lawson expressed discomfort at doing such things and asked for the opportunity to publicly share what she believed were the reasons for the site's problems, the potential defendants instead "privately threatened and publicly scapegoated" Lawson before ultimately firing her, the letter claims.

The alleged cover-up was based on two contentions, according to the letter. One was that due to mismanagement by Lawson, in May 2013 OHA failed to deliver a properly working health site to Cover Oregon staffers, who were "shocked" by the state of the project. The second was that Oracle, the primary systems integrator on the implementation, had "committed serious and fatal blunders in its work," according to Lawson's letter.

But in fact, Cover Oregon officials had been "heavily involved" in the project since at least June 2012, and their "inability to articulate clear business requirements" and "provide effective leadership rank among the easily provable reasons why the project failed," it adds.

Evidence suggests that Lawson was terminated because she wasn't comfortable adhering to the "talking points" Wentz gave her, according to the letter.

At one point, Wentz used threatening language toward Lawson, it adds.

"Somebody has to be held to blame for this," Wentz allegedly told Lawson. "It's going to be [King], or it's going to be Oracle, or it's going to be you. We want it to be Oracle, but it can be you if you want."

As a result of her experience, Lawson "has suffered grievous financial, reputational and emotional injury" and is entitled to damages, the letter states.

Wentz didn't respond to a request for comment Tuesday. Spokeswomen for Oracle and Cover Oregon declined comment.

If Lawson files a lawsuit, it may not be the only one. Oregon officials are withholding US$25.6 million of some $69.5 million Oracle says it is owed for work done on the project, and are also reserving their right to sue the vendor.

A scathing investigative report recently conducted by the federal Centers for Medicare and Medicaid Services put blame on both Oracle and Cover Oregon officials for the project's woes.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

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