[ktavera]

For all of you that didn't know, this project was never put out for bid with an RFP. It was sole-sourced to CGI Federal without any competitive bids.

"Federal health officials have not yet explained why CGI was given the contract or why it was awarded on a sole-source basis."

http://www.washingtonpost.com/business/technology/some-say-h...

[Edit to add source]

[iharris]

It's worth noting that CGI was also responsible for the ill-fated long gun registry in Canada, which was recently canceled due (in part) to massive cost overruns [1] and inability to cope with large numbers of users.

[1] http://en.Wikipedia.org/wiki/Canadian_Firearms_Registry#Cost...

[hga]

As an US RKBA activist since the early '70s (sic), I watched it from a distance in horrified fascination, and the Wikipedia section you cite matches my memories, that while the IT component was nasty and much bigger than expected/hoped/etc., it wasn't what crushed the registry. The job, including most especially human processing effort, was just massively larger than anticipated and was therefore not even vaguely covered by the statutory fees.

[iharris]

Yeah, this was a good lesson how not to manage a large IT project. They didn't really understand the requirements or anticipate the user load, but the cost estimates were WAY off - from an anticipated $2m annual net cost, the actual net cost ballooned to $66.4m for 2010-2011. To be fair, the federal government was also at fault here but this absolutely blows my mind.

[swamp40]

Honestly, you would think that a company that has experienced "massively larger than anticipated" once before would be a good choice for this project.

[hga]

I guess it depends on the tradeoffs of reputational damage and making money. I gather the government told them "build a system that can handle 50,000 to 60,000 simultaneous users", which was "based partly on the all-time high of 30,000 simultaneous users for Medicare.gov" presumebly during the Plan D enrollment season (although per the article the theoretical max of healthcare.gov has not been disclosed: http://www.usatoday.com/story/news/nation/2013/10/05/health-...).

Whatever the company thinks of the official goal, there's strict limits to how much extra they can spend to handle a much larger goal, vs. their getting paid on an emergency basis to bulk up the site....

[mgkimsal]

Are they not also a Canadian company?

http://en.wikipedia.org/wiki/CGI_Group

Why we'd be committing to using non-US companies to develop US systems... I guess it must happen sometimes, but on something this ... public?

[Lalabadie]

Québécois here. CGI are experts at complying on governmental project requirements and then obscenely inflating costs. I am not surprised they succeed in the US too.

[alex_anglin]

As a Canadian, I don't have any affection for CGI. But I would point out that this goes both ways: Just yesterday a peace activist in Canada was acquitted for not participating in the Census because she objected to the use of back-end systems from Lockheed Martin. (Never mind that the Census is no longer mandatory...)

Our nations do have a free trade agreement in place, which on the whole I would say has benefited both sides. Patriotism aside, 'buy American' policies do not help with these partnerships.

[LammyL]

Only the long-form census is voluntary. The short-form census is still mandatory, and not completing it could land you in court, like what happened here.

[abtinf]

We should spend tax dollars in the most effective way possible. If we can save money buying a good from a foreign source, more precious tax dollars are available for other vital government services.

You would need to do a lot of handwaving to try to argue that spending more money on "american-made" goods, just so that we can feel better psychologically, is a better use of tax money than, say, cancer research.

I'm not even sure what "american-made" would mean in the context of software, which is produced on a global scale. I guess we would have to use Windows Server for the backend systems (and only those parts of it made in the US), instead of Linux, which has Finnish origins.

Of course, I'm not saying CGI has proven very cost effective.

[mgkimsal]

I didn't say anything about "american made" goods specifically.

"effective" can be measured multiple ways. The more money that's spent on US companies keeps the money in circulation in this country longer than sending it directly to a Canadian company (even assuming they have some US-based contractors on the project).

More to the point, the project is primarily code development, which isn't substantially cheaper in Canada than here (again, not sure where the work was done, and by whom, explicitly). All things being somewhat equal, services money should by default be spent with US companies.

From what I understand, this was a no-bid contract, so how could CGI being "most effective" ever have been the case? Unless, of course, the overhead of a bid process was factored in to the equation; then, sole-sourcing can always come out ahead.

[ctdonath]

Upvote this.

Heck, push it to all your favorite news outlets. There's no reason why one obscure company should get the contract without viable competitors.

[Shivetya]

http://washingtonexaminer.com/canadian-firm-hired-to-build-t...

Based on that article, the OP is wrong, the six hundred million is across all contracts, the ACA site which most people are aghast at is just under 60 million of that.

[ctdonath]

Non-sequitur.

That others got other contracts is not relevant to the point that this contractor got this $60M contract without a bidding process when there was no reason to not solicit bids from others.

(As others note, seems it was a lot more than $60M.)

[somebehemoth]

Given that the title of the article that started this discussion is, "We paid $634 million for the Obamacare sites and all we got was this lousy 404". I'd say it is fair to point out that actual cost was ten times less than is claimed in the article. I agree that no-bid contracts are bad, but they certainly are not unprecedented. I guess I am just not getting the outrage other people seem to have here. Maybe because I am not against ACA?

[ctdonath]

I guess I am just not getting the outrage other people seem to have here.

"Buy my product or I'll charge you $3000" provokes ire, as does a subsequent "oh BTW, the website key to buying my product sucks, but that won't persuade me to delay enforcing the $3000 even though I've given all my buddies such wavers."

Such gun-to-the-head tactics tends to elicit verbose nit-picking. Not hard to understand, even if you don't share the consternation.

[somebehemoth]

It is very questionable whether a tax penalty is equivalent to "gun-to-the-head tactics". Speaking of a tax penalty: where did you get $3000 from?

"The fee in 2014 is 1% of your yearly income or $95 per person for the year, whichever is higher. The fee increases every year. In 2016 it is 2.5% of income or $695 per person, whichever is higher." - from https://www.healthcare.gov/what-if-someone-doesnt-have-healt...

Someone making $300,000 per year might pay $3k in 2014. I'm failing to have empathy for this kind of person who refuses to have health insurance. Poorer people pay way less of a penalty and are entitled to subsidies that make refusal of coverage much less fiscally logical.

The outrage still makes little sense to me unless you ignore many relevant facts.

[joering2]

According to last sentence of [1], $90 went to CGI.

[1] http://www.foxnews.com/tech/2013/10/09/3-million-obamacare-w...

[sp332]

That's $90 million :)

[api]

Very, very typical government contracting. Government IT contracting is like free money. Great work if you can get it, and getting it probably involves swallowing multiple congressmen's semen.

[raldi]

That's an interesting claim, but I can't bring myself to upvote it unless you add a citation link.

[ktavera]

I know because I was watching for the RFP to come out so my company could bid on it. Also it's been reported at various media outlets. http://www.washingtonpost.com/business/technology/some-say-h...

[joering2]

At least good to know CGI Federal is an American breed company!

</sarcasm>