Healthcare Fiasco Energizes Federal IT Reform Efforts

The widespread problems in implementing the Affordable Care Act have provided some momentum to the efforts by the Obama administration and Congress to ratchet up reforms in the management and procurement of information technology at the federal level.

President Obama, in fact, conceded the need to put more emphasis on such reforms when he spoke about the troubled health exchange website and other IT problems encountered in rolling out the Healthcare.gov program.

Noting that the “federal government does a lot of things really well,” he admitted last fall that “one of the things it does not do well” is the procurement of IT.

“You know, this is kind of a systematic problem that we have across the board,” Obama said at a press briefing.

The latest congressional IT reform initiative is a bill sponsored jointly by Sen. Tom Udall, D-N.M., and Sen. Jerry Moran, R-Kans., that was introduced in early January.

“The systemically flawed rollout of Healthcare.gov is one high-profile example of IT procurement failures, but numerous more projects incur cost overruns and project delays and are abandoned altogether. These examples of waste come at a cost of billions of dollars to American taxpayers,” said Moran.

In broad terms, the legislation would require the first major overhaul of the government information technology procurement process in over a decade, according to the sponsors. The bill, entitled the ”Federal Information Technology Savings, Accountability, and Transparency Act of 2013,” would ensure accountability by empowering federal chief information officers, elevating their role in civilian agency budget planning processes, and increasing their ability to optimize how agencies use IT.

Hobbled by Outmoded Law and Technology

“The federal government needs to be able to build cutting-edge, 21st century computer systems, but right now we are hobbled by laws written in the days of floppy disks and telephone modems,” Udall said. “We have an urgent need to modernize the law and especially to incorporate flexibility and accountability.”

The key provisions of the bill:

• CIO Status: Currently, federal civilian agencies employ CIOs whose authority over management and procurement of IT often is compromised by the delegation of budget control to financial officers or the managers of various programs. The bill would boost the status of CIOs at departments or major agencies by requiring that CIOs either be appointed or designated by the president in consultation with the head of the agency. CIOs would report directly to the head of an agency.
• Professionalism: To ensure competency, CIOs would be required to “possess demonstrated ability in general management of, and knowledge of and extensive practical experience in, information technology management practices in large governmental or business entities.” The head of each agency would be required to “ensure that the CIO has the authority necessary to approve the hiring of personnel who will have information technology responsibilities within the agency.”
• Budget and Procurement: Under the bill, CIOs would have authority to “participate in decisions regarding the budget planning process related to information technology or programs that include significant information technology components.” In addition, CIOs would have authority “over any acquisition of an information technology product or service that is a commercially available off-the-shelf item.”

Other provisions include improving the transparency of IT spending and performance activities and enhancing the role of the federal CIO council.

The Udall-Moran bill includes several elements of a similar bill proposed by Rep. Darrell Issa, R-Calif., in the House last year. The House bill is more comprehensive and deals with a broader range of IT procurement issues. The Issa proposal, known as the “Federal Information Technology Acquisition Reform Act,” was enacted by the House as part of a defense spending measure last year. The Senate eliminated the IT reform proposal when it acted on the defense bill, however.

“The House bill was advancing pretty well even before the Healthcare.gov problems emerged, but those problems have created more interest in reform,” Roger Jordan, vice president for government affairs at the Professional Services Council, told the E-Commerce Times. “The Udall-Moran proposal helps to move the ball down the field as well, and we are generally supportive of that proposal.”

Getting Reforms Right

Enactment of federal IT reforms is certainly possible this year, but the fuss over federal healthcare IT doesn’t necessarily mean that reforms will be adopted in 2014. Tech industry representatives generally are supportive of the reform measures but are wary that the healthcare issue might lead to quick enactment of reforms that may fall short of their objectives.

“We would like to see a broader approach than either the Senate bill or FITARA provides. We think there needs to be more attention on getting the procurement cycle time down to a shorter time frame. Also, more needs to be done to get broader participation of vendors with truly innovative IT capabilities,” Jordan said.

“We need to take a look at government-wide procurement vehicles that include task order contracts. Those types of contracts with indefinite-delivery, indefinite quantity provisions can certainly save time in the procurement process, but we need to make sure they are inclusive of available vendor resources,” he said.

“Sen. Udall’s legislation is a step in the right direction. Expanding the authority of CIOs over certain IT spending makes sense, as does enhancing the role of the federal CIO Council,” Mike Hettinger, senior vice president for the public sector at TechAmerica, told the E-Commerce Times.

“The legislation is far less comprehensive than what Rep. Issa has proposed in FITARA, and it does not cover other key issues like data center consolidation, but it is an area where we believe more needs to be done to enhance transparency into IT investments and create cost savings,” he said.

“The Udall bill is helpful because it formalizes the IT procurement process for many agencies,” Jeff Cook, senior manager at Aronson, told the E-Commerce Times.

The Bureau of Public Debt currently handles IT procurements on behalf of smaller agencies that do not have the capacity for the IT procurements on their own, Cook noted.

In a similar vein, the National Business Center provides operational support and software applications and development for other agencies, he said.

Worries Over Privacy and Off-the-Shelf Technology

“This bill will allow agencies to have a clearer picture of IT procurements on their own through the empowerment of the agency CIOs, which in turn will provide better service to taxpayers and contractors. With the implementation of this bill, federal contractors should see more contracts that get the government up-to- speed with modern technology,” said Cook.

The commercial off-the-shelf provision in the Udall-Moran bill also gave him pause.

“While COTS products are often a less-expensive solution, given the sheer size of the government and its agencies, interaction among the various systems within the agency and external agencies is very difficult to accomplish if you are using strictly COTS products,” Cook explained. “The lack of infrastructure can make it more difficult for COTS products to work together effectively across-agency, compared to getting the agency systems to talk to one another through more customized programming.”

Going forward, IT procurement at the federal level will include a greater degree of security requirements for the protection of government and personal data, he said.

The FITARA bill could save as much as US$20 billion from IT procurements over time as federal agencies implement the bill, Issa has claimed.

However, it appears that it initially will cost money in order to save money in the long term. The Congressional Budget Office reported last November that implementation of the Issa bill would cost $145 million.