I'm pretty sure 'huge business opportunity' will trump paralysis. :)

Yes but to succeed it needs to do more than not be repealed. It needs to be implemented. It's a big job for any government, let alone one that suffers paralysis like ours. 

It's also a huge business opportunity. 

Well, it passed Congress, was signed by the President, ruled constitutional by the Supreme Court, the President was re-elected, the Senate is still Democratic -- so it should be good for at least two years, politically. After that, we can see if the Senate turns Republican; if not, it should be good for at least two more years. Recall that it's survived something like 33 Congressional votes.

Is there reason to believe this will work, given the extreme hostility government programs face in the current political climate, and paralysis in Washington?

thanks, ime. I was posting something along the lines of your third point, but your first and second points hadn't occurred to me. 

By allowing each state to independently build or buy the software, competition is created.  If the Feds were to implement a top-down software solution, the benefit of trying different solutions is lost, and the risk that the Federal solution would be late or inadequate is magnified.

Furthermore, that would establish a sole contractor, which creates management problems.  Maintenance costs are effectively uncontrolled, because of the monopoly on source code access created by copyright laws.  Renewal costs are similarly unconstrained by competition.

Furthermore, individual states regulate insurance sales within their borders.  A federal program would need to be highly customizeable, to accomodate every variation that any state might allow or restrict.  By delegating the responsibility to the states, the federal government makes it easier for states to individually tailor their markets to their own regulations.  Concerns about "unfunded mandates" are alleviated because the Feds generously funds the insurance exchange iplementation process.

Michael, that's exactly it. I can only speak for my own state, Idaho, but it is my impression that things are going on similarly in other states. First they waited for the various courts to finish, in hopes that it would be declared unconstitutional. Then, when that did't work, they hoped that President Obama would lose the election and they'd be off the hook that way. At this point, Idaho (as well as the other six undecided states) have until December 14 to decide what they're going to do -- and even if our Governor decides to go along with it, the Legislature could decide, when they go into session in January, to do something different. So we shall see.

Paul, to a certain degree, to the extent that there is fraud, it is partially an IT problem. I recently did an article about how new ways of doing computer-based Medicare billing are resulting in huge new costs, because providers are simply cutting and pasting information from one form to another to make it look like the examinations that they performed on each visit look more extensive than they really were.

On the other hand, the providers argue, with some justification, that the Medicare and Medicaid rates are very low, and that they might end up spending a large amount of time with a patient because there are so many components to their condition, and so the new systems are enabling them to fairly account for the amount of time they're spending with these patients -- and, to a certain degree, payback for the months and years they've been dealing with these patients and not being reimbursed properly.

dcawrey, it'd be pretty difficult to set up a centralized federal IT system to control this. Politically, it would be very difficult because of the whole states rights/federalism issue that has made Obamacare so difficult to pass in the first place. Beyond that, every state has differnt laws and rules around selling insurance, so it's not going to be easy to develop a single application that could interact with all of them. 

"It's too bad that the federal government was not able to come up with a solution in terms of IT for Obamacare."

I didn't get that same conclusion after reading Sharon's blog. It is not that the Federal government doesnot have an IT solution for Obamacare but that the solution is decentralized. That according to Sharon is the big challeneg facing the health information exchange i.e. trying to synchronize these States's individual solution to the Federal hub. 

As a result of that,your conclusion that "I expect to see a patchwork of systems that link up to Washington, with varying degrees of success" holds true.