Oregon reporters missed the story of a failing health exchange—until they didn’t

After a slow start, the state press corps recovers with a bang

Behind Oregon’s failed health insurance exchange is a story of spin that in some ways mirrors federal officials’ management of news about the Affordable Care Act from its passage in 2010 to the present day. For the last three years the Oregon Health Authority and Cover Oregon, the state exchange, played a PR game, hiding myriad IT and contract disputes with Oracle, their contractor; relentless bureaucratic backbiting; and bad business decisions. Gov. John Kitzhaber has claimed he didn’t know what was going on until after the exchange opened, while those tasked with building the site ignored internal warnings, shrugged off oversight reports, and misled the public, reassuring themselves and the press that all was well.

We know this now because, when problems became apparent just before the state exchange was supposed to go live on Oct. 1, reporters in the state press corps started to read between the lines of official pronouncements and began their own investigations, which cracked the story wide open. We didn’t know it sooner because, for months before that, both legislative and media watchdogs were slow to question the official spin. There are lessons for journalists in both the strong recent reporting and the weaker early coverage.

Oregon has often been hailed as a pioneer among states in healthcare reform—though past efforts have sometimes failed to live up to their billing—and the state was supposed to be a leader in this transformation, says Diane Lund-Muzikant, executive editor of The Lund Report, a Portland-based site for health professionals. This time the state had high ambitions and grand plans for a seamless, integrated online system, a model for other states where Medicaid recipients, the uninsured, and small businesses could sign up with ease.

The state got national buzz for its ambitious good-government approach, but “Oregon tried to take on too much,” Lund-Muzikant said. Unlike in some other states, there was mostly widespread support for the goal of expanding coverage. “I think people believed in the democratic ideal that people should have insurance,” said Lund-Muzikant, and the media and others were slow to question the official optimistic pronouncements.

Whether it was subtle self-censorship, the tight noose drawn around information by state officials, or just a focus on other stories, the exchange’s progress toward launch day wasn’t at the top of the news agenda throughout most of 2013. “No one had any sense we were going down the road we went on,” said Markian Hawryluk, an investigative reporter who covers health for The Bulletin, the daily paper in Bend, OR. Even Nick Budnick, an investigative health policy reporter for The Oregonian who along with his colleague, Jeff Manning, has done a stellar job covering the exchange since last fall, acknowledges he should have jumped on the story a year ago March. “I regret not doing that,” he told me. “With so many other stories to do, it’s hard to do that kind of coverage if you don’t know the story is there.”

Like the story coming from some other states, Oregon’s narrative in spring and summer of 2013 was one of good news about insurance rates. Premiums in the exchange were low—so low two carriers asked regulators’ permission to file new lower rates once they saw what their competitors were doing. Budnick covered that story in May; it was also picked up by The Washington Post, where Sarah Kliff wrote that “Oregon may be the White House’s favorite health exchange.” (Other Post pieces asked, “Can Oregon save American health care?” and “Is the future of American health care in Oregon?”)

But as the launch date neared, there were signs success was not at hand. Reporters were barred from the exchange’s “situation room,” designed to deal with bugs and crashes on opening day. The day before enrollment began, Cover Oregon officials organized a highly unusual conference call with insurance agents to warn them the exchange website would be available only for limited use and instruct agents to stop scheduling new client appointments until further notice. At The Oregonian, Budnick and Manning got suspicious. The next day came Cover Oregon’s upbeat press release, touting a “new day in health care for people across our state”—but also hinting at trouble. “We knew there would be bumps in the road as we roll out the technology and we’ve planned for them,” said Cover Oregon director Rocky King. He admitted, “We are not fully satisfied” with the part of the system that determines eligibility for tax credits—a key mechanism in the law’s promise of affordable care.

Two weeks after the launch, the spin machine was spinning again. The Oregon Health Authority announced that while the private exchange wasn’t yet up and running, so many people had enrolled in the state’s expanded Medicaid program that the number of uninsured residents had been cut by 10 percent—a bit of good news that was especially welcome at outlets looking for Obamacare success stories. On the blog for The Rachel Maddow Show, Steve Benen wrote: “While the federally-run marketplace has been overwhelmed, there are ample state-based success stories nationwide. Take Oregon, for example.”

Budnick filed that story, too, on Oct. 17. But a day earlier, he had made six open records requests to find out what was happening behind the official pronouncements. The next day he made five. Requests from The Oregonian are now up to about 90, and Budnick says there will be more. The Portland-based TV station KATU, The Associated Press, and the Salem Statesman-Journal also began filing requests to pierce Cover Oregon’s spin. Those outlets have tackled the story in slightly different ways, but they’ve all done important work. It’s a bit of old-fashioned journalistic rivalry that has served the public well and may have contributed to the state’s recent decision to turn the exchange over to the federal government.

The digging really started to pay off in December, when journalists began breaking stories that reconstructed the fiasco and showed how deep-seated the problems were. A Dec. 14 article by Budnick and Manning uncovered an email from King, the exchange director, two weeks before launch day: “We are in serious trouble. This whole IT thing has gotten away from us.” A month later, the Oregonian reporters documented the warnings from skeptical tech analysts as far back as 2011—along with the steps state health officials had taken to silence critics.** Other journalists were on the case, too. A big piece by KATU in December offered this summary quote from an analyst who left the project: “Mismanagement, mismanagement, mismanagement all the way around.”

KATU has been particularly aggressive in going after Kitzhaber. In early January, when reporter Hillary Lake tried to interview the governor on camera, he abruptly ended the conversation after four minutes of questioning. Weeks later, the station delivered an investigative report on what the governor knew and when he knew it—describing as “incredible” Kitzhaber’s claim that he hadn’t known about the problems until late October. Just last week, the station reported on a batch of misguided celebratory emails sent on the Oct. 1 launch day, along with a thank-you letter from Kitzhaber to those involved in the exchange. Wrote the governor, “This is a proud moment for our state. You exemplify the best of public service.”

As Manning of The Oregonian says, “We still don’t know if it was a conspiracy to hide the truth or a cosmic level of ignorance or magical thinking.”*

But the journalistic digging hasn’t only been backward-looking. As recently as the end of March, the information noose was still tight. When Chris Gray, a statehouse reporter for The Lund Report, tried to attend a meeting of a legislative oversight committee created to keep tabs on the exchange, Cover Oregon communications officials, tossed him out and barred two Statesman-Journal reporters from entering the office. Gray told me when the communications staff saw him they said the meeting was private, off limits to the public. Both outlets broke the news, raising the prospect of a violation of the state’s public meetings law. According to the Statesman-Journal, the committee, whose meetings hadn’t been advertised to the press or public, did little oversight. “In hindsight, we obviously didn’t ask the right questions,” one legislator told the paper. The meetings, for what they’re worth, are now open.

The journalistic skepticism has also unearthed dark clouds in even the silver-lining story of expanded coverage for low-income households through Medicaid. In March, Budnick revealed a series of problems affecting the state’s Medicaid program—problems that stemmed from failures at the exchange. Some 4,000 applicants for a special state program that provides undocumented immigrants with pregnancy services were mistakenly enrolled in Medicaid, contrary to federal law. Thousands of Medicaid enrollees were tagged as individuals instead of family members, which meant families were split between different care organizations creating needless hassles for parents. The interface between the exchange and the Oregon Health Authority, which had a tracking system for Medicaid members didn’t work. “It’s been a mess for us,” said the head of one provider group, in a typical comment.

So what has the Oregon mess told us about journalism? The biggest takeaway is that a vigorous press willing to do the hard digging is still essential for holding government officials accountable. Though local media were slow to catch on here, they redeemed themselves. Much as the media landscape has changed, old-fashioned tools like open records laws are needed more than ever—as is a wary skepticism of announcements from officialdom.

The digital age also presents us with new challenges for how to cover businesses and government that that are so dependent on IT. How should we cover the nitty-gritty of information technology and contracting issues, which are increasingly important on the healthcare beat? How can we know what to look for in real time so that we recognize, as Budnick might say, that the story is there? More training? Integration with other beats? When Healthcare.gov, the federal exchange site, crashed, it was the first time many health reporters confronted IT snafus as a major story. “It was a lesson learned for journalists,” says Hawryluk, of the Bend Bulletin. “Next time there is a website we’ll be so much more cognizant of the technical issues.”

* This sentence has been revised to provide the correct attribution for this quotation. CJR regrets the error.

** This sentence has been revised to indicate that both Oregonian reporters had bylines on the story.

Related content:

Forget the spin of eight million sign-ups

Exchange Watch: California Dreaming

How to measure Obamacare success

Has America ever needed a media watchdog more than now? Help us by joining CJR today.

Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman. Tags: , , , , , , , ,