Healthcare.gov "Obamacare" Website May Lead to Lawsuits

by Laura Bedson, Associate Staff

On October 1 of 2013 the much awaited online insurance exchanges launched under the Affordable Care Act.  With this launch millions of uninsured people were to be offered health insurance plans on Healthcare.gov.  Unfortunately the website did not run as smoothly as planned, leaving individuals with error messages and long waits to sign on to the site.  And to date, the website is still experiencing technological difficulties.  These technological errors, while embarrassing, and frustrating, have proven to be the least of the Obama administration’s worries.

Where this mess gets even messier is when you start to contemplate the lawsuits that will inevitably spring up as a result of the problems encountered on the website. Currently the extent of the legal issues seem like a good deal of finger pointing but in today’s lawsuit-happy society, it is likely that lawsuits are possible and imminent.  What we are waiting for at this point is for the tangled web of culprits to be unwoven. 

Health and Human Services Secretary KathleenSebelius is part of that web, and is one of the parties who has been the subject of much scrutiny as a result of the website’s failure.  Secretary Sebelius is convinced that by the end of November the majority of consumers will be able to successfully use the site to enroll in their insurance plans.  This does not mean however that Secretary Sebelius is off the hook.  She along with an additional 55 or so contractors reportedly involved in setting up the Obamacare federal exchanges stand to be implicated in lawsuits seeking refunds as a result of the site’s malfunctions.[1]  In fact, on Thursday, October 24, House Oversight Committee Chairman Darrell Issa threatened Secretary Sebelius with a subpoena saying that if she didn’t respond to questions about the problems with the website she could possibly face compulsory action.[2]

Action can come about in the form of the federal government suing for refunds or withholding payment to contractors.  In response to this, the contractors who feel they are entitled to payment could sue.  In addition, the contractors can sue one another.  This web of blame is undoubtedly tangled but with so many players involved it is likely that someone will be impacted.  Harv Lester, who spent 20 years litigating in the Justice Department’s Civil Division is quoted saying that “the government, to recover damages, will have to prove which contractor or contractors are responsible for any defects.”[3] 

Overall this ordeal is just beginning.  It is likely that we will have to wait until the end of November, as Secretary Sebelius has predicted to determine what the extent of the damage is.  Right now it is clear that these technological glitches carry more weight than anticipated.   We will just have to continue waiting and watching to see how the rest of the story unfolds.