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Obamacare Exchanges: System Failure

October 8, 2013

For months the Obama Administration claimed that Obamacare’s insurance exchanges would be tested, secure, and ready to start enrolling people on October 1. The President promised they would work just like

Last Tuesday, the exchanges went live. Americans quickly discovered that Obamacare exchange shopping did not resemble Amazon. Customers experienced a laundry list of system failures:

  • exchanges not opening on time or launching at all;
  • long wait times online and at call centers;
  • persistent computer error messages;
  • blank online application drop down boxes preventing people from creating user accounts and security questions;
  • inability to compare health plans;
  • failure to complete the enrollment process.

Obamacare system down

Even Supporters Admit Defeat

One reporter at MSNBC – which has been among the law’s most persistent cheerleaders – spent 35 minutes trying to demonstrate to viewers how to enroll using the New York online health care exchange site. She finally threw in the towel, saying, “If I were signing up for myself, this is where my patience would be exhausted.” This was not an isolated incident. People all across the country had similar problems:

  • Arkansas. Insurance agent Joey Crump failed to access the Arkansas online state exchange saying, “It’s been frustrating.”
  • Georgia. The Simmons family tried to enroll, but none of them were able to even create an account. Mrs. Simmons said, “If this is how it is at the very beginning, it just doesn’t give me any confidence that it will get any better.”
  • Indiana. Bruce Brian, a real estate broker, tried logging onto but could not create an account because the system was unavailable. Brian said, “You would just think that with all this time they’ve had to get it set up and ready to go, they would have [had] a better premiere.”
  • Illinois. Kimberly Shockley, a self-employed CPA spent over an hour trying to get the security questions to work with no success. She said, “I’m frustrated, very frustrated.”
  • Virginia. Charlie Spiering spent an entire morning trying, and failing, to create a account saying, “It appears that we won’t be shopping and comparing healthcare plans anytime soon … My friend jokes, ‘I don’t think a website has put me in a line before, particularly not at 4 a.m.’”
  • Wisconsin. John Sanders actually signed up on his state’s exchange website three weeks ago. Even he experienced trouble calling the Obamacare launch “reckless at best. I will not accept the ‘heavy traffic’ argument. What else would be expected on the national launch date?”
  • West Virginia. Jon Tucci, self-employed in the oil and gas industry, spent 10 hours – two attempts online and one 45 minute call with a consumer service agent. He said, “I’m pretty fluent on the Internet … I’ve applied for a lot of things, and there are always glitches. But this was totally disappointing. I’m just really frustrated.”

Obama Administration Stonewalls on Data

The Obama Administration claimed traffic surges caused the problems. Despite the glitches, an HHS spokesman said the agency was “thrilled” with the number of people who visited the website – approximately 4.7 million during the first 24 hours. There is a big difference between the total number of site visits and the total number of people able to use the application technology to enroll in a health care plan. What’s more, some estimates have been far off the mark. California initially claimed that five million people had visited its state exchange on the first day, only to admit the next day that its $313 million online enrollment system had received just 645,000 hits. Amid the confusion and doubt, the self-proclaimed “most transparent Administration in history” has refused to issue specific exchange enrollment figures.

The Administration wants the American people to believe its exchange system was just temporarily overwhelmed by volume. In reality, this was a massive, fundamental architectural failure. Today there are approximately 5,244 websites that generate more internet traffic than As one web security expert describes it, the Administration’s homepage was likely not overwhelmed by traffic because “you’d just get an error page like ‘this site isn’t available’ instead of error messages from the application.” This implies that most people visiting may not actually be applying for insurance, but are simply looking for basic information. The Administration’s current Internet homepage should easily deliver basic information without crashing. It requires more technological resources, however, to create a user account, compare plan rates, fill out applications, ask questions using web chats, choose a plan, and complete the enrollment process. 

So what were the successful enrollment rates? While the Obama Administration declines to say, we could expect rates to be fairly consistent system-wide. The Connecticut exchange reported a conversion rate of 0.47 percent. If we conservatively double that rate for, that would represent 44,382 transactions.

Compare that to President Obama’s promise that the exchanges would operate like Amazon. In 2010, the last year for which the company publicly released data, Amazon processed 13.7 million transactions on its busiest shopping day – the rough equivalent of Tuesday’s exchange opening. HHS spent three and a half years, and millions of taxpayer dollars, designing and implementing the federal exchange. On Tuesday, the American people watched their investment collapse under a transaction load representing 0.32 percent of Amazon’s real world capacity in 2010.

The President even tried to explain it away by comparing it to Apple’s new operating system. But even the far-left Wonkblog at the Washington Post found this comparison laughable. It noted that “the Obama administration doesn’t have a basically working product that would be improved by a software update. They have a Web site that almost nobody has been able to successfully use. If Apple launched a major new product that functioned as badly as Obamacare's online insurance marketplace, the tech world would be calling for [Apple CEO] Tim Cook's head.”

Whether the Obamacare exchange system failures occurred due to heavy online traffic or design flaws, Administration officials should not be surprised. Republicans warned the exchanges were not ready for primetime, but the President and Washington Democrats ignored calls for a delay. Now the President may have to delay the individual mandate on his own. According to one expert commenting on the failure of the exchanges, “people can’t be fined for not having something that they can’t purchase.”