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Oracle Businesses Government The Almighty Buck News

Oregon Withholding $25.6M From Oracle Over Health Website Woes 132

Posted by Soulskill
from the all-about-the-benjamins dept.
itwbennett writes "Oregon is holding back $25.6 million in payments from Oracle (out of some $69.5 million Oracle claims it is owed) over work the vendor did on the state's troubled health care exchange website. The site was supposed to go live on Oct. 1 but its launch has been marred by a slew of bugs and it is not yet fully functional. This week, Cover Oregon said it had reached an agreement with Oracle laying out 'an orderly transition of technology development services, and protects current and future Cover Oregon enrollees,' according to a statement. Oregon officials reached the deal with Oracle after the company reportedly threatened to pull all of its workers off the project and essentially walk away."
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Oregon Withholding $25.6M From Oracle Over Health Website Woes

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  • by Z00L00K (682162) on Wednesday March 05, 2014 @04:30PM (#46412203) Homepage

    Too many companies deliver sub-standard software without any risk at all, especially in big projects.

    Mistakes do happen, but underbidding is too common.

    • Re: (Score:2, Insightful)

      by Bartles (1198017)
      Too many governments deliver sub-standard public services without any risk or recourse, especially in big projects. It's not the contractors fault, it's the contract manager's fault.
      • by thaylin (555395)
        I will disagree wholeheartedly. There are issues with developers sometimes not getting the proper information, however many development processes aer geared directly towards getting that information. This lands squarely in a poorly developed product on the developers end, as the article implies functionality that was given to the developer, and a slew of bugs.
        • by tomhath (637240) on Wednesday March 05, 2014 @04:51PM (#46412445)
          A lot depends on what the developers are given to work with. It sounds like Oracle salesmen talked Oregon into buying a hodge podge of stuff that supposedly bolted onto Siebel. When that kind of technical decision is made based on what the salesman gets a commission on it usually doesn't turn out well.
        • by Zero__Kelvin (151819) on Wednesday March 05, 2014 @10:00PM (#46415209) Homepage

          "I will disagree wholeheartedly"

          OK. Just let us know when you get around to it! I do have one question, though ... why the hell don't you just disagree now? Procrastination issues?

      • by Anonymous Coward on Wednesday March 05, 2014 @04:46PM (#46412395)

        Too many public services that were privatized under the guise of saving money now cost the public more money than when they were publicly run. Turns out 'privatization' is a euphemism for 'funnel money in to my campaign contributor's pockets'

        • Re: (Score:2, Informative)

          You are only PARTIALLY correct. The "Public Sector Services" part is designed to enslave voters to a single party so that any "cuts" (by cuts, we mean slowing growth of programs) becomes a sledgehammer to bang over the head of the other party.

          Meanwhile our governments are going into further and further debt, maintaining services that are often overlapping by 10-12 times with other "public services" and there is no will or even intention of ever cutting out the cruft.

          And make not mistake, the lining of polit

          • IF all you see is the otherside being the problem, you're part of the problem yourself. Until we get past (D) good, (R) bad (or visa versa) there will be no solution to the ongoing nightmare called "government".

            Thankfully, more people are realizing this every day.

        • by Bartles (1198017)
          Are you telling me it would have cost less to train and hire an army of programmers and such that would have done the job instead of Oracle or other contractor?
          • Considering the overhead sure it would. The problem with a lot of these projects is the client supposedly does not have the experience in-house to evaluate if the programmers know what they are doing or not. Nor to they know anything about project management. So they get a contract with an established brand name which often just shoves guys fresh out of college with no experience at the job. I'm looking at you Accenture.

          • by Vanders (110092)
            Why not? Do you think Oracle paid their developers and managers in promises and unicorn farts? Why couldn't Oregon simply have paid for those developers & managers themselves?

            The point of hiring contractors is that they're supposed to bring instant expertise to a project. If they don't actually do that, why bother with the extra expense of the middle man?
            • by nobuddy (952985)

              bigger campaign contributions and a cushy high paying job when your term ends, of course.

      • by Charliemopps (1157495) on Wednesday March 05, 2014 @05:33PM (#46412915)

        Clearly you've never worked with Oracle. The states biggest mistake was hiring them.

        • by amiga3D (567632)

          Their biggest mistake was paying them. They should have told them to skip. I'd rather pay twice the money than have someone fuck me like that.

      • It's BOTH of their faults. It is the government's job to know what the hell they want and to provide solid requirements. If the government is not doing a good job of providing concrete requirements, it is the job of the contractor to extract those requirements from them or come up with their own requirements and get the government to formally approve them. If that is not done, then the requirements continually change, the project drags on way past it's deadline, and since time is money, the project goes w
      • by dnavid (2842431)

        Too many governments deliver sub-standard public services without any risk or recourse, especially in big projects. It's not the contractors fault, it's the contract manager's fault.

        Technically, its both of their fault. However, there's a presumption that the client has far less knowledge and competency in the subject of the contract than the contractor who is presumptively being hired explicitly for their knowledge and competency. A client that fails to keep its contractors in check is guilty of being naive or lazy. A contractor that fails to deliver on its contract is guilty of professional misconduct. The penalty for the former is and has always been getting substandard delivera

        • Totally agree, but I should note that it happens the exact same thing in the private sector. Ive seen salesmen threatening customers to with dropping support for, say, the ERP, if they did not push a competitor out in an altogether unrelated section of the business like hardware, OS or even collaboration tools.

          Oracle has a well earned reputation for being a company of assholes from the utter top to the lowest bottom (okay, i should probably exclude the cleaning staff): it shows in their sales but, worse, it

          • by dnavid (2842431)

            Totally agree, but I should note that it happens the exact same thing in the private sector. Ive seen salesmen threatening customers to with dropping support for, say, the ERP, if they did not push a competitor out in an altogether unrelated section of the business like hardware, OS or even collaboration tools.

            Indeed. The problem is the power lies generally with those with the technical expertise, and those people overwhelmingly end up with vendors and not customers. Of course, if they had a sense of professional ethics, that would also act to solve the problem. I'm not hopeful.

      • by unimacs (597299)
        No recourse?

        Elect somebody else.
        • by Bartles (1198017)
          Yes elect somebody else, and watch the unstoppable social project fail for generations. We've never seen that before have we?
      • Too many governments deliver sub-standard public services without any risk or recourse

        Are we talking global politics here?

        If we're talking US, then this is wrong. Politicians get voted out of office **all the time** in America. Sometimes they go to jail for their treachery. That's alot more accountability than a government contractor has.

        Governments have more accountability than private companies in a democracy...no matter what the economic system.

        If we're talking globally, the democracy factor is still ke

        • by DaHat (247651)

          Politicians get voted out of office **all the time** in America.

          People loose races yes... but on average an incumbent is far more likely to hold onto their seat then lose it to a non-incumbent.

          Governments have more accountability than private companies in a democracy...no matter what the economic system.

          For the most part I can (and do) choose which companies I do business with... I don't have the same degree of choice when it comes to government.

          • Politicians get voted out of office **all the time** in America.

            People loose races yes... but on average an incumbent is far more likely to hold onto their seat then lose it to a non-incumbent.

            absolutely wrong...Corrupt officials get voted out alot more often than the norm ...you can't just compare **all** politicians & say that proves your point. When a politician engages in behavior that demands accountability they are ****much more likely**** to get voted out of office

            Governments have more accountability than private companies in a democracy...no matter what the economic system.

            For the most part I can (and do) choose which companies I do business with... I don't have the same degree of choice when it comes to government.

            again wrong...IF YOU VOTE you have influence on how the government spends your tax money!!

            the GOP and Democrats are very different, any look at their *actual policies* and voting records proves that...

            *money influences politi

      • by geekoid (135745)

        "Too many governments deliver sub-standard public services without any risk or recourse"
        such as?

    • since they left a festering mess behind. and then Oregon could sue for all the money back.

    • underbidding is too common

      Underbidding can happen for two reasons:
      a) fraud
      b) poorly written specifications

      If it's a) then expect to be in court (or pay the bribes necessary to the corrupt officials of whichever organization is paying). If it's b) then perhaps you shoud have paid a real project planner and requirements people to do their jobs. $2200 doesn't cut it.

    • by Anonymous Coward

      Too many companies deliver sub-standard software without any risk at all, especially in big projects.

      A problem which is easily solved if the people who write the contract aren't a pack of fucking retard monkeys.

  • by Bartles (1198017) on Wednesday March 05, 2014 @04:34PM (#46412255)
    ...at least had great propaga...I mean, advertisements.
    • by roc97007 (608802)

      Yeah, methinks they should have checked to see if the website actually worked first.

      • Most products/projects are advertised before they're done being put together and tested. Hell, we have a CostCo advertising in this area when they haven't even finished bulldozing the lot yet.

        • by roc97007 (608802)

          You're absolutely right, but pre-announcement should have been preceded by some kind of risk assessment. I'm sure that was a line item and I'm sure it got crossed off, but clearly it was inadequate.

          The snarky side of me wants to say, it's Oracle -- what did you expect? But I won't say that. Except I just did. That's the problem with meta-conversations.

      • The site "worked"...it was built to specifications. It's **the purpose of the site** as directed by non-tech health industry people that was the failure.

        If you looked at the original site, it was essentially a guide to signing up for ****private insurance**** like Kaiser Nazi-mente, which run the Oregon Health Authority

        Those private companies wrote the requirements for what the site would do!

        Look at this interview with the original IT manager: http://www.oregonlive.com/heal... [oregonlive.com]

        from the above link:

        -- Lawson s

  • Sounds Nice (Score:4, Interesting)

    by johnnyb (4816) <jonathan@bartlettpublishing.com> on Wednesday March 05, 2014 @04:36PM (#46412279) Homepage

    Must be nice to be able to fail at a project such that they owed you $69 million, but you don't actually have to make it work.

    Perhaps states should make a rule stating that large projects must be broken up into deliverables of $1 million increments.

  • by Anonymous Coward

    Working with Oracle has been a joke. Their software designers are a far cry from the quality you usually find in the US. Most of their designs are heavily influenced by people who don't have the technical skills to implement things.

  • by viperidaenz (2515578) on Wednesday March 05, 2014 @04:37PM (#46412293)

    Just one more thing though.
    Oracle should pull all of its workers off the project and walk away after giving back all money already paid.
    If you don't deliver what you've been told to deliver, you shouldn't get paid.

  • Oracle Services (Score:3, Interesting)

    by Anonymous Coward on Wednesday March 05, 2014 @04:44PM (#46412377)

    I don't have any personal experience with Oracle the company. But I've spoken to a half-dozen or so of their clients, and not one of them has ever had a successful completion of a project, and they've all gone over budget. Purely anecdotal evidence, I know.

    I'd be interested to hear if someone has had a good experience working with Oracle...? But if the overwhelming consensus is negative, how do they continue to gain new clients?

    • Re:Oracle Services (Score:4, Informative)

      by penix1 (722987) on Wednesday March 05, 2014 @05:27PM (#46412835) Homepage

      But I've spoken to a half-dozen or so of their clients, and not one of them has ever had a successful completion of a project, and they've all gone over budget. Purely anecdotal evidence, I know.

      I could tell you from a West Virginia perspective it isn't good:

      http://yro.slashdot.org/story/... [slashdot.org]

      And that's not anecdotal evidence.

    • by johnnyb (4816)

      It has been over a decade since I last worked with Oracle, so things may have changed. But when I worked on an Oracle project, it cost a huge amount of money, took way too long, didn't work well, and required double the number of staff to manage the application. After Oracle left, a second company came along behind who specializes in fixing stuff that Oracle broke. This company, I don't remember its name, literally does its business as cleaning up Oracle's trash. They didn't even promise good results, o

  • by HockeyPuck (141947) on Wednesday March 05, 2014 @04:45PM (#46412385)

    Even without the $25m owed in the contract, Oracle is probably still profitable on the deal.

    I bet they maintain 60-70% margins... and that's on the services side...

    • by NoKaOi (1415755)

      Even without the $25m owed in the contract, Oracle is probably still profitable on the deal.

      I bet they maintain 60-70% margins... and that's on the services side...

      Probably, but at least Oracle has a $25m incentive to make the damn thing work. Maybe if more government entities did this then big contractors might realize there is incentive to actually make what they're building work. The real question everywhere else should be...why the hell is [companyX] getting paid for something that's not usable? Or are those contracts written so horribly that the company gets paid for a nonfunctional product?

      • by johnnyb (4816)

        "Or are those contracts written so horribly that the company gets paid for a nonfunctional product?"

        The problem is that a lot of these types of contracts are written with a clause such that launching them publicly is an implicit acceptance of the project as a finished product. So, since they at least tried to launch it, that means that the project is "finished", and everything else is billed hourly on top of it.

  • "It's also possible Cover Oregon will use software developed for other state exchanges or Healthcare.gov, according to this week's announcement."

    It took them a year and over sixty million dollars to determine that's it's cheaper when every deployment doesn't reinvent the wheel? Yeesh. Fail.
    • by thaylin (555395)
      Well some states purposely wanted to balloon the costs, or make the law look like a failure (hey look at what those dems cost us)
      • Re: (Score:2, Informative)

        by Obfuscant (592200)

        Well some states purposely wanted to balloon the costs, or make the law look like a failure (hey look at what those dems cost us)

        The President of the Oregon Senate and the Speaker of the House are both Democrats. The Governor is and has been a Democrat. Yeah, I sure see how the Oregon government has acted to make those dems look really bad. Oregon has been progressive in its health insurance systems for a long time. Of any state where you could express this kind of paranoia, Oregon is about the last one it would apply to.

        On the other hand, a lot of the people in the rest of the state (Portland and Eugene are concentrations of "dems

        • by thaylin (555395)
          I was not being partisan in my statement, and was not specifically talking about Oregon in this case, I said "some" states...

          On the other hand there are also many cases where "those repubs" do the same thing you are saying about "those dems".

          • by Obfuscant (592200)

            I was not being partisan in my statement,

            Well, yes you were. When you refer to people who want to point the finger at "those dems", that's a partisan statement.

            and was not specifically talking about Oregon in this case,

            While you weren't being specific, you replied to someone who was, and you're in a discussion that has the title "Oregon withholding ..." so "some states" does include Oregon. I just told you that you should exclude Oregon from "some states" and your paranoia about this being sabotage by people who want to accuse "those dems" for the problem.

            On the other hand there are also many cases where "those repubs" do the same thing you are saying about "those dems".

            Not in Oregon. Dems in charge. Even if you were

    • by mikelieman (35628)

      If the wanted to SOLVE the problem, they would have just rolled out Universal Medicare and the VA's VistA system and use all the existing infrastructure.

      But that's not the goal.

      • That's essentially what Obama first proposed and what was passed by the House. It was blocked by a handful of Democrats in the Senate- namely Joe Lieberman, Evan Bayh, Blanche Lincoln, and Mary Landrieu. To be fair to the last three, the bill was not popular in their rather red states and voting for it would have probably cost them their jobs.

        After that failed, they went to Plan B which was the shitty compromise that we have now. It's still a nice step up from what we had before.

  • Oregon officials reached the deal with Oracle after the company reportedly threatened to pull all of its workers off the project and essentially walk away.

    So Oracle bluffed, playing games with the lives of Oregon residents. Good job, Oracle! You're everything we've come to expect from years of government training.

  • by mattis_f (517228) on Wednesday March 05, 2014 @05:18PM (#46412761)

    It's an honest question. I am a programmer of embedded systems and microcontrollers, my expertise is at the other end of the computing spectrum.

    As much as I like to blame Oracle, the state may have added serious requirements at the last minute that complicated everything. These articles doesn't say anything about it. Same seems to go for all the troubled exchanges - so what's the problem?

    Is there anyone on here with some insight?

    • Re: (Score:2, Informative)

      by Obfuscant (592200)

      As much as I like to blame Oracle, the state may have added serious requirements at the last minute that complicated everything.

      Uhhh, no. I don't think "have a button that you can click on to enroll online" was a last minute decision. That's what was lacking -- you could browse all kinds of things, you just couldn't sign up online.

      You could download a 19 page form to fill in and send back so they could send you another form to fill out to enroll, so no worries mate! Nobody died (yet) from not being able to meet the mid-December deadline for signing up for insurance to start on Jan. 1. But the nurse I talked to earlier this year wa

    • This web site is a front end that is supposed to federate all the suppliers of health care insurances. Since there is no clear and complete standard interface, most of the work goes into making "glue code" to get all the insurers hooked up to the system. The visitor has to be able to experience all of this real time. Try interfacing with over 50 slightly different but very similar complex computer systems that each have their unique protocol. Writing good requirements documents is an absolute nightmare, let
      • by Cimexus (1355033)

        This.

        I have some involvement with this project and the above sums up the main issues nicely. Combine that with the fact that the data that you have to handle provided by some of the external systems is incomplete and often very 'unclean' (in some cases outright corrupt) and the fact that the solution you're implementing features dozens of different products integrated with each other and you get some very weird failure modes that are almost impossible to test for adequately.

    • No, Oracle the devil. As much as I dislike government, I know how Oracle works and this is EXACLY what they do. I've seen it over and over... first hand experience. They will tell you they have a software product that does exactly what you're looking for, it's all integrated with their other systems... sell it to you... then you find out they bought the product from some other company 2 months ago. Lies lies lies.

      They actually sent an "Expert" in to train our employees how to trick their support employees i

    • the site was built to specifications...it's that those spec's were written to make the site a revenue channel for **private insurance** not provide ratings and info on policies

      here is the original IT manager for the project, who was fired for asking exactly the questions you're asking:

      http://www.oregonlive.com/heal... [oregonlive.com]

      the needs of the site (and any site like this) are not extraordinary...the HTML & CSS practically writes itself...the only really difficult area is handling the HIPPA data securely

  • Oracle reported $ 9,275 MILLION in gross sales for the last quarter in the records. Their profit was $2,553 MILLION.

    Holding $25.6 MILLION back is Chump Change for them. Larry Ellison probably has a larger petty cash budget.

    Sure, somebody at Oracle will likely loose their job, maybe even a few will, but this is down in the noise for Oracle in general.

    • Oregon does not need to change the behavior of Larry. Two trophic levels are directors whose bonuses will be badly dinged when the check does not arrive from Salem -- getting their attention will be helpful.
    • by geekoid (135745)

      25 million is not chump change to ANYONE. It will need to be reported, their stock may take a slight dip. No business owner says '25 million? we don't need it.

      They may determine their efforts to get 25 million will cost more then the actually 25 million, but that's a business decision that has nothing to do with chump change.

      • by bobbied (2522392)

        This is barely 1/2 a penny to the earnings per share in a QUARTER. They spend more on paper clips and staples. Heck, Ellison and the board likely spend more than that on travel expenses for one meeting.

        I'm not saying that Oracle won't try to collect the remaining funds or that stern faced bosses won't wag their fingers at middle management for it and cut their bonuses and raises. I'm saying that except for the bad press, Oracle won't care much. After all, they got 2/3'ds of the money already and can real

  • HAHAHAHA (Score:5, Informative)

    by Charliemopps (1157495) on Wednesday March 05, 2014 @05:22PM (#46412799)

    As a customer of Oracles, and having these very same products including Sieble... all I can say is "You should have asked me first"

    This is exactly what we're going through. They sold us a suit of "integrated software products" that were in no-way integrated or even related. They charged us to configure the software, then when the software didn't work, told us it was configured wrong. Then when it was time for a new contract tried to exempt themselves from liability for "Configuration changes" and threatened to not renew and not fix the issue unless we did sign. (we didn't and almost ended up in court)

    Then when they were making changes their support teams would log into their software through various back doors and make changes without notifying us, leaving a trail in the audit log with "NULL" in the place where the user account that made the change was supposed to be logged. They remotely modify white lists into the application suite without permission despite specific contractual agreements that they would not. We've got Oracle Employees whitelisting their home DSL accounts and logging in at random at all times of the day.

    Oracle is the worst Vendor I've ever worked with. They are incompetent, malicious, vindictive and will outright lie, con and steal from their customers. They literally deprecated our ODBC connection to a SASS once because we weren't going to renew our contract and they wanted to charge us to move the data off their systems. Luckily we had planned for such a thing and already had a replication database in-house. God I hate Oracle.

  • should do this. Oracle is a nightmare to work with, never seem to deliver as promised, and always have a reason to charge for fixing their bugs.

  • Welcome to Oregon Trail!
    Please enter your name: Jimmy
    Welcome, Jimmy!
    Jimmy, you have 3.9 million people.
    How much do you wish to spend per person for a computer government medical insurance system from a contractor?
    > $17
    The contractor screws up, drags ass, and whines for more money. Pay?
    > Sheee...no
    >I don't nderstand.
    > No

  • by jawnah (1022209)
    I, personally, am shocked to see this out of Oracle. In other news, having worked on many of the less-common Oracle products (not Database or AS), I've actually found that the majority of their crap doesn't work at all. When you report a bug, they have a team dedicated to basically finding a reason why the bug shouldn't be fixed/resolved. One product in particular never works out of the box and always requires patches on the GA version in order to work. Also, when you go to upgrade this product (which is r
  • All the states developing their own websites, and the feds, should have pooled their money and offered an X-Prize worth $100 million to whatever individual or group could first create an open-source health insurance purchasing web service meeting the requirements. That would have saved money and produced a better result.

  • Ive worked with several fortune 500 companies that got into Oracle's Black Hole of DEATH. Classic propietary setup, even if you are purchasing open source service and expertiese. They do have the toughest salesmen youve ever seen since Saint Paul, ill grant them that, and the technology is not necesarily FUBAR. Much of it is FOSS or has a FOSS equivalent and it is standard's compliant if the end customer demands it (and they do: we have won that battle at least). And some of it is supperb, but not without p

  • Fuck Oracle. They wasted our money.

    At work, I go across the street to smoke -- and there's Netflix and Oracle, and I just want to see a nice big bomb fall out of a Oregon Nat'l Guard plane and blow it to shit. No foul if Netflix's Cust Serv center there takes any damage.

    (Why do I not like Netflix? They fired me for pointing out a security hole on their website -- and 3 years later, it's STILL there.)

I find you lack of faith in the forth dithturbing. - Darse ("Darth") Vader

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