WASHINGTON -- The Obama administration said Friday that it would fix problems in the federal health insurance marketplace by Nov. 30, just two weeks before the deadline to sign up for coverage to replace health insurance policies being canceled because they do not meet new federal standards.
To help meet that schedule, the Obama administration, in an abrupt shift, named a "general contractor" Friday to fix the troubled federal marketplace website.
Such a condensed schedule raises the question of how hundreds of thousands of people whose current policies do not comply with the health law will obtain new coverage in time.
Jeffrey D. Zients, President Barack Obama's troubleshooter on the project, said the general contractor, Quality Software Services Inc., a unit of the UnitedHealth Group, would "manage the overall effort," like a general contractor on a home improvement project. Notably, that firm had a role in developing one of the most troubled components of the marketplace, which helped verify identities of those registering.
Until now, the federal Centers for Medicare and Medicaid Services, led by Marilyn B. Tavenner, served as quarterback, trying to coordinate the work of dozens of contractors. Outside experts said the agency did not have the expertise or resources to be the "system integrator" for such a complex, ambitious project. Two people involved in the effort said the schedule for repairs was aggressive.
But Mr. Zients, a management expert set to take over as chief White House economic adviser Jan. 1, said, "By the end of November, HealthCare.gov will work smoothly for the vast majority of users. ... It will take a lot of work. A lot of problems need to be addressed," he said. "But let me be clear: HealthCare.gov is fixable."
The website has frustrated millions of people trying to obtain insurance under Mr. Obama's health care law. Administration officials said the site must be fixed fast for political reasons and for urgent practical reasons.
In recent weeks, hundreds of thousands of people have received notices from insurance firms saying their current coverage is about to end because it does not comply with the Affordable Care Act. For example, their policies may not provide "essential health benefits" such as maternity care and may not cover as much of the medical costs as required by new federal standards.
A typical letter to about 25,000 policyholders from Independence Blue Cross in Pennsylvania says, "As a result of the health care law, your current health plan will be discontinued effective December 31, 2013." And consumers living in Washington, D.C., were informed by CareFirst Blue Cross Blue Shield that "your current plan will cease to exist" Jan. 1 because it does not conform to new federal mandates. Blue Cross and Blue Shield of Florida said it was informing about 300,000 subscribers that their current insurance policies did not meet the new benefit requirements.
Consumers are typically offered new coverage that meets federal standards, but the cost of comparable policies may be more or less than they now pay, depending on a person's age, income, family size, place of residence, tobacco use and other factors.
Insurers and White House officials said many consumers would qualify for insurance subsidies under the president's health care law if the government could process applications in a timely way and calculate subsidies correctly.
Mr. Zients said a team of experts from inside and outside the government had found bugs in some of the software used in the federal exchange website. That finding differs from the original explanation of problems that have crippled the website. Administration officials at first said the difficulties had occurred because the number of people trying to use the website far exceeded their expectations, and they played down other factors.
The new law requires most Americans to have health insurance. People generally must sign up by Dec. 15 for coverage that takes effect Jan. 1. However, the open enrollment period continues to March 31. People who go without insurance after that date may be subject to tax penalties.
The chaos and confusion surrounding the federal exchange have prompted some Democrats and many Republicans to suggest that the penalties be deferred or the enrollment period extended for at least several months.
Health and Human Service Secretary Kathleen Sebelius is scheduled to testify next week before a congressional committee. In the past six months, despite doubts expressed by many Republicans, she has said repeatedly that it would be easy for Americans to enroll in health plans on the federal exchange starting Oct. 1. More than 30 House members signed a letter to Mr. Obama this week urging the resignation of Ms. Sebelius, who they said was responsible for "the fiasco that is HealthCare.gov."
The designation of Quality Software Services Inc. to coordinate work on the federal exchange represents a radical change in its management. A congressional hearing Thursday suggested that no one was effectively coordinating the contractors' work.
"We learned that this entire project has been poorly managed at the top, and the left hand does not seem to know what the right hand is doing," said House Energy and Commerce Committee chairman Fred Upton, R-Mich. "It does not instill confidence that officials at QSSI, who have been at the forefront of this mess," are being selected to save the project.
CGI Federal, a unit of the CGI Group, based in Montreal, has been lead contractor on the federal exchange, a role for which it was paid $88 million through March. How QSSI will work with CGI is unclear. The two firms have been pointing fingers at each other -- and the government -- as Congress tries to determine who was responsible for shortcomings of the federal exchange.
Julie Bataille, spokeswoman for the federal Centers for Medicare and Medicaid Services, said the administration had selected QSSI to supervise the operation because it was already "familiar with the complexity of the system," had done a good job on some parts of the project and had "the skills and expertise to address these problems right now."
Specialists working on the project said it was better to choose a company already involved in the effort than to try to bring a new contractor up to speed -- a step that would only delay the fixes.