Accenture Wins U.S. Contract for Obamacare Enrollment Website

Jan 12, 2014 3:54 pm ET

Jan. 12 (Bloomberg) -- Accenture Plc, the second-biggest technology-consulting company, will take over construction of healthcare.gov, the Obamacare enrollment website that debuted with crippling computer problems in October.

The U.S. government has awarded Accenture’s Federal Services unit a one-year contract, with an initial payment of $45 million, the Dublin-based company said in a statement yesterday. Accenture will succeed Montreal-based CGI Group Inc., which drew criticism for the website’s early stumbles.

While the site has improved, healthcare.gov’s first two months were marred by delays, error messages and garbled data that bogged down insurance sign-ups in the 36 U.S. states served by the federal system. Accenture led construction of California’s better-performing state exchange.

“Accenture will bring deep healthcare industry insight as well as proven experience building large-scale, public-facing websites to continue improving healthcare.gov,” David Moskovitz, chief executive officer at Accenture Federal Services, said in the statement.

The government-run insurance exchanges offer health plans and access to subsidies created by the 2010 Patient Protection and Affordable Care Act. CGI’s role in managing healthcare.gov had been reduced following the botched rollout, with a unit of UnitedHealth Group Inc. brought in to oversee emergency repairs. Most Americans have until March 31 to select a health plan for 2014 coverage.

Contract Value

Accenture rose less than 1 percent to $83.20 in New York trading on Jan. 10, the day The Washington Post reported the company would replace CGI. Its shares have gained 19 percent for the 12 months through last week. CGI fell 2.9 percent, to $31.58 on Jan. 10.

The Centers for Medicare and Medicaid Services chose Accenture from more than a dozen firms, according to the company’s statement. The contract’s final value will be based on “mutually agreed-upon work plans,” the company said.

Accenture will help the federal system prepare for its second open enrollment period in October 2014, including “24/7 support of the marketplace application, eligibility and enrollment functions, generation and transmission of enrollment forms, and features related to special enrollment periods,” according to the statement. Accenture also will develop new features for future phases of the program.

--With assistance from Alex Wayne in Washington. Editors: Mary Romano, Kevin Miller