Software engineering is the discipline concerned with writing large scale software so that a large software package comes in on budget and on time. I will present a software development model that is applicable to the software required for Obamacare.In any software projects there are 3 actors: (1) the management who pays the technical staff and should monitor the project to see if it is on schedule and on cost, (2) management should write, and debug the code and (3) the clients. The three actors should be independent. The stages might be something like the following.1. Requirements analysis: The management should know what is required and hire a SD to be responsible for developing the software. The management meets with the SD (and preferably with some clients) where management explains to the SD what management wants and the date he would like to have the software working. At the end of this project a set of specifications for the project should be developed. This is important because at the end of the project we do not want the SD to say "It's done, pay me" and the management replies it "But you didn't do this". The SD replies "that's not in the specifications and it will cost you $$$$ more to do that". Management may be a very difficult situation if the organization needs the project at that time.2. Software Design: The SD goes home and with his staff defines the architecture, components, interfaces required. Briefly this is a macro view of the software code. For example, the Obamacare requires the IRS data base must be accessed to determine who is eligible for certain subsidies. Also the SSN database will probably have to be accessed. The interfaces to these data bases must be defined and carefully controlled for privacy reasons. Then subdivisions of code (called modules) must be determed with clearly defined interfaces. For example you might have a module accessing the IRS, another module that handles interaction with clients, and so on. There may be tens or hundreds of modules required. At this point no code need be writing ... what we want is a macro view of the project. At this stage the large parts of code related to a particular function. No code is written at this stage; we just want a macro view of the project.After the software design a PERT (or similar) Chart (seehttp://en.wikipedia.org/wiki/Program_Evaluation_and_Review_T...)should be drawn up. It is important that the milestones represent the the completion of a module including testing of the module. Without the PERT (or similar tool) chart the software project is out of control. There will be no way from someone on the outside to tell how the project is progressing. When one builds a house, you can see foundations being laid, the frame going up, electrical wiring and plumbing going in. With a software project you see nothing nothing. Management is at risk of (1) discovering the project will be late the day the software is supposed to go online and/or (2) having to negotiate additional payments to complete the project. Management should never be surprised; if the project is late the management should know as soon as possible so that problems can be mitigated. Or management may even pull the plug on the whole project.After the software design is finished the SD sits down and decides how much the SD will ask for the project an how long it will take. Then the SD will sit down with management and negotiate a fixed price and timeline and possible penalties for missed deadlines.Any changes to the specifications after this point may be very expensive.3. Software coding: this involves coding and testing at the module level. 4. System testing: tests the system as a whole, in particular it tests all the interfaces between modules and external inputs.5.Roll out or implementation: Two possible strategies are a phased roll out or big-bang roll out. For Obamacare a phased roll out may be to start the rollout in several states first, then a few more states later, and the remaining states still later. Big-bang means rolling out the whole system all at once. One advantage of phased implementation is that it may be easier to train the clients.6. Software maintenance: Maintenance includes fixing bugs and adding adding functionality to the software. A large number of bugs probably means not enough resources were given to testing, and a large number of changes probably means that not thought was given to the requirements and design phase of the software project. Making changes in the maintenance phase is very expensive compared to getting it right the first time.It seems probable that Obamacare did not follow the above procedures. For example implicitly the delivery date was fixed in Congress when they wrote into law that the law would take effect in 2014 and I assume that the system had not been designed at that time. Without seeing the PERT chart it is difficult to determine if the software will be ready next year and what parts will need work. The fact that the employer mandate will be pushed back to 2015 indicates that some of the project are behind schedule. A particular worry is security (privacy) threat that involves accessing the IRS and SS databases. The Snowdon and earlier Wikileaks leaks does not indicate the government is good at security.For an example of a project that went off the rails seehttp://finance.yahoo.com/news/pennsylvania-kills-ibm-contrac... I can't tell what happened but it seems that the plug should have been pulled earlier.klee12
Hi Klee! Are you familiar with the concepts behind Agile software development? What you are describing sounds like a Waterfall model, which these days is generally considered to be a more costly, risky way to get stuff out to market.
Hello whafa,Yes it is the Waterfall model. In the case of Obamacare the law says it has to be done on by a certain time and we want to get it right the first time, something like the software to send someone to the moon. I don't think the people who wrote the law knew much about software development and created an situation that where it was very difficult to get the project done on time. If they had been aware of the software problems the Congress might have changed to law to all Obamacare to be implementd in phases.I'm not familiar with the Agile but looking it up on Wikipedia it looks like a it requires iteration. An iterative model would, IMHO, be the best method in developing a new operating system (OS) where you build the OS, test it in house, change it, and when it works the way you want you can release it. With Obamacare it's not clear how you could test it unless you have written a modules for insurance plans, determination of who gets subsidies, and employer reporting. So it might not be appropriate here.Whatever software model is chosen the steps in the waterfall model has to be done; the only thing is they may be at different times. In particular milestones has to be written or the project is out of control But the nodes of the milestones imply some requirements are done, some design is done, some development and testing is done and redone. The Waterfall model is easy to explain and I use it to introduce some concepts to those without project experience and to describe the perils of software projects.Comments, corrections, bricks welcomeklee12
Hi Klee,While I think you gave requirements elicitation and analysis short shrift in your summary, I agree that a project as large, complex and subject to regulatory compliance issues needs a more more documented approach than Agile can offer. I also wondered about the methodology used in this massive development project, and would have to note that a project in which the requirements change at the whim of Congress would be very very difficult to scope and control.
Important to note that California's implementation is also huge (as California has large % of USA population), and its Obamacare "gateway to insurance marketplaces" is working very well.I know because I have already used it to comparative shop, picked insurance, and registered. No problems.david fb
Hello MegHammond and flyerboysI haven't visited this board recently because for a while there was no activity. I will try to visit more frequently for the next few weeks.Meghammond wrote <<. I also wondered about the methodology used in this massive development project, and would have to note that a project in which the requirements change at the whim of Congress would be very very difficult to scope and control. >> I have not heard of what methodology they used. I wrote the post to show that there should be a methodology which entailed requirements and milestones. I used the waterfall only to show what it would look like. If you don't have milestones, I would say the project is out of control. I do not know if there are any milestones for this project.flyerboys wrote << Important to note that California's implementation is also huge (as California has large % of USA population), and its Obamacare "gateway to insurance marketplaces" is working very well.>> Yes some states have the system working but many do not. All the news is about the ones that do not. We do not know how many are working relatively well and how many are doing very poorly.I propose that the metrics of how well obamacare (ACA - affordable care act) works should involve (1) how many people end up enrolling and (2) the number of security issues. At this time most of the information I have come across is anecdotal but indications are that is not working well. The best informative article I have come across is the articlehttp://www.bloomberg.com/news/2013-10-22/obamacare-crashes-m...I believe what everyone agrees that the first two weeks of the ACA was not a great success. Beyond that most of what we hear from various politicians are either vacuous or inaccurate. The opponents of ACA criticisms state the obvious but do not propose any metrics to measure the judge how well the ACA is doing. Some of the statements by the administration are inaccurate, misleading or point to gross incompetence. For example the President said that he was surprised by the problems and implied he expected a smoother turnout. But every software methodology should prevent management from being surprised. Every methodology should have something like a PERT chart to tell you if you are late you are in delivering a finished product (a finished product should involve all testing is done, especially integration testing) A main part of software engineering is to keep management for being surprised. Management can (usually) live with a delay in product; what they do not want disaster when they roll out the product. When Apple rolled out the iPad, it worked; if it didn't work would have had big hit in reputation and have to refund most of their purchases. A common late integrated testing phase is sometime called beta testing during which users or simulated users actually used the system (e.g. iPad) This is sometimes called Beta testing. When Apple rolled out the iPad they were confident that the glitches would be minor. When the administration rolled out ACA on October they knew or should have known that they would have a mess. If they say they had to make a last minute change, they should have been aware of the consequences.At this point we know the software rollout was unsuccessful. The question is how long will it take before they can get the software to work at an acceptable level. If I saw the PERT chart, the milestones, and how many of the milestones had been completed I might make a guess. But the information is not available as far as I know.The administration may be adding people to the project. But many people in the software engineering field think that adding more people to a late project may make it later. See the book "The Mythical Man-Month"http://www.amazon.com/s/ref=nb_sb_noss_1?url=search-alias%3D...I read (a long, long time ago) the first edition, which is still worth reading. I haven't read the second edition. If it contains the first edition, I suggest the first edition.I would encourage those who have professional software experience to post their experiences or opinions on this thread. I hope this thread avoids discussing the wisdom of the ACA, politics and other topics not related to software engineering. I encourage everyone to post questions and requests for clarification.klee12
The following are some several scenarios of what might happen.I will assume two of the necessary conditions for the Affordable Care Act (ACA, aka obamacare) to be a success are that (1) the software project must become functional and (2) enough healthy people must sign up for ACA. But enough healthy people cannot sign up if the the software project is not successful. Thus ACA will not be a success unless the software project is functional. How do we define success? IIRC, the administration hoped for 7 million people to sign up by the end of December. It seems of of the necessary conditions for the success of the software project is that it enroll a given number of people in December. I'm not sure what that number is but it should be spelled out.I am doubtful that the software project will be successful (at least by December) based on my experience and what I have read in the media. Someone from the administration said they hoped to have the web working by November. In the House hearings, IIRC, contractors said they didn't do any integration testing, and they would like to have several months to do that testing. In several months it will be 2014. I do not have not seen the design for the software project. It should have the equivalent of a PERT chart and milestones. I and probably no one outside the government or contractors have that information. I don't think most of the politicians and know about PERT charts and milestones used in software projects. Without having any of this information predictions are just speculations unsupported by evidence.I speculate that integration testing is not the only thing that is needed before the project can be called successful. I suspect that the administration will add more requirements (change the specification of the projects) and these changes will add to the delay. Comments, corrections, bricks welcome, especially from those with software experience.klee12
Yes some states have the system working but many do not. All the news is about the ones that do not. We do not know how many are working relatively well and how many are doing very poorly.Yes some states *seem* to have the system working...I would have these questions:*Have these states been able to connect to insurance, IRS and SSA databases? Sure they may be successfully registering people, but getting them connected with an insurance company, getting subsidies and paying money is another issue.*From today's news: How vulnerable will these sites be to hacking? Will this vary from state to state?*To what extent are the successes we're hearing about really about enhanced Medicare registration, for which the software infrastructure is arguably preexisting, and relatively easy to get going? I've been reading about this figure approaching 90%.*Some experts have said that it will take a complete rewrite to get this right. How long will that take? Some have said 6-12 months. Yet the current system has taken what? 3 years?*There are six software contractors working independently on this, no? How are they coordinating? http://money.cnn.com/2013/10/21/technology/obamacare-website...*The government has been interfering in the process, including demanding late in the game changes such as putting cost estimates behind the registration wall. This is a classic government-related factor in almost all projects, and it significantly complicates even the smallest projects. Will this stop in the redesign?Then there are meta-issues, such as the lead contractor, CGI, having a poor track record, a Michelle Obama crony being an executive with the contractor, and likely more issues under smoke-fire criteria.
Interesting article:http://www.nationalreview.com/article/362299/can-website-rea...From page 2:What can maybe be done by the end of November:*Add time to the schedule;*Reduce (or accept reduced) functionality;*Reduce (or accept reduced) performance;*Reduce (or accept reduced) quality.And there's this, an evaluation by a software veteran:If so, “clients” such as Ben Simo are less than amused. “The decision letter I received says that I have ten days to appeal any decisions or I will be ineligible for coverage in the future,” Simo says. “Now, they’ve put me in a position that I have to get Healthcare.gov and a state agency to collaborate to withdraw the application I never submitted.”We are on the verge of seeing dark catch-phrases such as “Kafkaesque” and “Catch-22” recede in favor of a new one to describe bureaucratic nightmares: “Healthcare.gov.” A true Halloween horror story.Once word about this gets around, it will take courage or ignorance to register.Finally, the "best and brightest", even loyalists, may not want anything to do this:The tragedy is that there really was a path not taken in designing the website. “We would have done this” for a fraction of the price, “and it would have been working perfectly,” Marc Benioff, founder and CEO of Bay Area global cloud provider Salesforce.com, told Politico. “But we were turned away.”Even veterans of Obama’s campaigns, which garnered such praise for their tech-savvy approach, were ignored. Clay Johnson, a founder of Blue State Digital, the company that developed Obama’s 2008 campaign website, turned down a chance to work on Healthcare.gov last year, during the time he was a Presidential Innovation Fellow. “It was a project I wanted to steer clear of,” he told the New York Times.
Hello KatangaACA (aka obamacare) is a very contentious issue and I have tried deal with hard numbers. People of good will can differ on motivations of the politicians, the wisdom of AKA if it can be implemented, etc. Alas, much of what has been said can never be proven right or wrong. But we can predict numbers, and the predictions can be proven right or wrong in the future. For example I will not predict the web will be running satisfactorily by because arguments can arise about what is satisfactory. But if I predict that we will have 3 million enrolled by December, that is a hard number and can be shown to be correct or not. By the way, IMHO, if they can enroll 3 million on the web by Dec, then I think that they can enroll 10 million in 2014. Also, if they can enroll 3 million by December the web will probably be operating in a satisfactory manner as far user experience on the web is concerned, but may not be operating in a satisfactory manner as far as security is concerned. If the web is working correctly then the next question that will arise is do we have the right mix of users signed up. And there will be more questions after that. I will not formulate the questions in terms of hard numbers at this point.Now as far as your first is concerned about state exchange enrollments, I don't know. I don't believe what the politicians are saying since they have a vested interest in painting a rosy picture. We will have to wait until January to see how many sign up.How secure the system is unknowable to the general public at this time. But I speculate that for political reasons getting the web up and running is higher has a higher priority than making the system secure.In regard to your question about Medicare, did you mean Medicaid? I have heard that Medicaid registration is higher than registration for those seeking insurance but I have no hard numbers.In regard to the time it takes for a complete rewrite, I don't think that will happen due to political considerations. I just don't know how much code can be reused. I will assume that by government interference you really mean the government changing the specifications of the software. Again impossible to tell, but I speculate that the present administration does not realize how costly it is to change specifications and will continue to do make changes (possibly for political reasons) in the future. I think it is common in software contracting that every change be written up; the write-up should specify what has to be changed, how much that will add to the cost, and how the change will affect milestones. The PERT chart and milestones should be updated to reflect the changes. At this point the public does not have hard evidence of the number and nature of the changes in detail. I have no comment on the meta-issues; I am primarily interested in hard numbers.I will consider several of many scenarios. I assume there is a political deadline: namely that by April, many individuals must have insurance or pay a fine. It seems unlikely that the IRS can impose a fine if the users cannot get insurance from the exchanges. Let me offer a two of possible scenarios1. The web is up and working and 3 million sign for something. Then we will see the demographics of those who signed up. If very few relatively healthy people sign up, then insurance companies may have raise rates which will further discourage more healthy people from signing up. Or some insurance companies may try to withdraw from the exchange. It's not clear to me what will happen.2. The web is not working satisfactorily and the laws may be changed. Maybe the date for the individual mandate is pushed back because of the political deadline described above. But the what will the insurance companies do? They will be stuck with the sick until the mandate is again imposed.Now Katanga and I are refugees from the Real Estate Investment Trust (REIT) board and we are interested how ACA affect REITs. I think it's too early to speculate on how REITs will be affected by ACA.Comments, corrections, bricks welcomeklee12
2. The web is not working satisfactorily and the laws may be changed. Maybe the date for the individual mandate is pushed back because of the political deadline described above. But the what will the insurance companies do? They will be stuck with the sick until the mandate is again imposed.My chess and go playing self wants to look farther ahead. Does this lead to insurance company bankruptcies? Government "too big to fail" takeovers? Raised rates on payroll-based policies, in an attempt to recoup? Emergency appropriations? Some combo of the above?
Hello KatangaI think I agree with the substance of the NR article, but it doesn't have numbers that can be shown correct or incorrect. Those who support ACA may brush off the article. They can say all the problems with the web will be fixed by real soon now. I do not want to cast blame; it's not constructive. I want to engage those who disagree with me. The only common ground we have are the numbers. <<My chess and go playing self wants to look farther ahead. >>Do you play go? Haven't planed in ages.I would like to look further ahead but my little brain is incapable of doing that. It's not just a software problem it's a political problem. For example, if they decide to change the law, how many ways can they change the law. For each possible alteration of the law what the possible consequences of the law for each of the following players: the American public, the insurance companies, various senators and representatives seeking reelection, the various lobby groups? I think the political consequences will weigh very heavily on the administration. Thinking about it gives me a headache. klee12
I would like to look further ahead but my little brain is incapable of doing that. It's not just a software problem it's a political problem. For example, if they decide to change the law, how many ways can they change the law. For each possible alteration of the law what the possible consequences of the law for each of the following players: the American public, the insurance companies, various senators and representatives seeking reelection, the various lobby groups? I think the political consequences will weigh very heavily on the administration. Thinking about it gives me a headache. Then I think the bottom line here is to stay away from healthcare stocks with ACA associations until there is clarity. On the REIT board, there's a new post looking at REITs relative to their government receipts.As to "brushing off" of articles without numbers, I'm with you. However, if you can't get good numbers, isn't that telling in itself?
Katinga wrote <<Then I think the bottom line here is to stay away from healthcare stocks with ACA associations until there is clarity. >>Nothing is risk free in this world. An interest rate hike might be more damaging. I'm hoping for the best and watching for what happens in the ACA front. I assume there will be a lot of spin both pro and con. so it is important to decide what information is important. I try to filter out all finger pointing and discount most anecdotal information. The important data to watch for concerns how many people nationwide are signing up and what are the demographics of the those signed up. I think ACA will not be working well in December because some congressional hearings seemed to reveal that integration testing had not been done. It is not clear to me that they can complete the integration testing in one month and have the programs work well. If everything is fine except for integration testing then the web may work well then sometime between January and March . But there is the possibility that the programs being integrated have problems. In that case there's no telling of when the programs will be ready for prime time, IMHO.While I don't know what will happen, I do have opinions on what will not happen between now and the end of the year. I think interest rates will stay below 3%; I think that ACA will limp along. I think that if the numbers buying insurance is low, the administration will delay announcing the numbers as long as they can. That implies if they don't release numbers in December, things may not be going well for them.Comments, corrections, bricks welcomeklee12
Here's statistics:Four sources deeply involved in the Affordable Care Act tell NBC NEWS that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”snipBuried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, “40 to 67 percent” of customers will not be able to keep their policy. And because many policies will have been changed since the key date, “the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range.” So we're talking about let's say 10 million people will lose their policies and have to pay significantly more for new policies. That includes 100% of private policy holders who are men, because pregnancy and birth control care will have to be added. There are 317,000,000 people in the US. So about 3% of the population.Open question: Of those losing their policies, how many will get new ones and how many will elect to drop coverage?
Hello KatingaI don't doubt the statistics. The result will be ACA will lose even more support which may (if the GOP does not goof up again) change Congress. But that's just an impression that is not quantifiable.How will the statistics affect my metrics? If those who lost their insurance do not sign up but incur the fine the first year at least the software will probably not be a success. If the web is working and those who lose their insurance pay the increased insurance rates then the web may be a successful. Time will tell.klee12
Time will tell.Indeed. But lets say of that 10 million suddenly uninsured, around half choose to pay the penalty instead. Now take a highly leveraged pharmaceutical like VRX. Say it looses a few percent of revenue as a result. Because of the leverage, it takes a high single digits earnings hit through at least the first half of the year. The stock plunges 10-20% at an earnings call.Perhaps better to delay investing in such a company?The point I am trying to make is, is what we are seeing actionable?
Excellent article related to your post, but at a more global level, on the interaction of technology, planning, and political teams leading to a train wreck.The long article concludes with the bottom line that all the planning, fine tuning, and theory in the world will not come close to what actually happens when a major game-changing paradigm shift in policy takes place.http://www.bloomberg.com/news/2013-10-28/obamacare-s-big-thi...
I think Obamacare is another name for medicaid, and it's use will be largely abandoned. Doctors and patients (except for the very poor and sick) will opt out of Obamacare entirely if they have free will. It'll be "cash only", and likely cheaper in the long-run as well.
I think Obamacare is another name for medicaid, and it's use will be largely abandoned. Doctors and patients (except for the very poor and sick) will opt out of Obamacare entirely if they have free will. It'll be "cash only", and likely cheaper in the long-run as well.Granted. But we're working on figures as well as facts. If you come up with some concrete numbers, post them here. I'm seriously concerned with the effects of ACA on the healthcare sector and the economy as a whole.My call is a half percent hit on GDP just from people opting out of ACA and not going to the doctor with a sniffle.
<<< The important data to watch for concerns how many people nationwide are signing up and what are the demographics of the those signed up. >>>After they sign up and find out what they've got, how long will they keep paying? Many who sign up think that they're getting healthcare. The little healthcare they will get will deteriorate in in terms of accessibility and quality and probably quite rapidly.
<<< My call is a half percent hit on GDP just from people opting out of ACA and not going to the doctor with a sniffle. >>>Maybe a 1/2 pct, but I see them going to CVS, WAG & RAD instead (a lot of REIT held properties including among ARCP holdings). If it's more than a sniffle Medical Travel and foreign medical destinations. Many U.S. Hospitals have foreign affiliates already. Some speculate that HCP's new CEO involves HCP investing/expanding in foreign medical properties.I really get upset when RAD enters my thoughts. I traded in and out of it against Shorts for years, almost all the time beating the Shorts soundly, until my last winning trade, just before a major short squeeze. I got a few dimes with that last RAD trade, instead of the dollars that I would have gotten if I had held it. I'm getting over it, but slowly.
I just had a thought. I wonder if anyone is going to suggest that talk about REITs and drugstore companies doesn't belong on this healthcare board and should be on the REIT board instead!!! LOL
Hello KatingaYes, the that was a good article. It seems to come from an insider who has worked in Washington on IT so he has good insights which reinforces my opinion. But I am cautious because we don't have someone other side rebutting what he says. And we don't have hard numbers or metrics. I would really like to have a cadid talk with Zients.I agree with the author that the probability of having what I would consider a working system on Nov 30 is low. I think the probabilities are high that the administration will say it is working. We will see at the end of the year who is right when enrollment numbers should be released. How they got into that fix is not important except as a predictor of future performance. The longer its not fixed the more political heat they will get and the more likely it is that changes will be made to ACA. I don't know what (if any) changes will be made but I think there will be changes in the next couple of years assuming the software is not working.klee12
wastelandrover wrote <<After they (those whose medical insurance premium rise ) sign up and find out what they've got, how long will they keep paying? >>Good question. But I think that this group of people will look at what they get the options first and then they will decide what to do, pay the increased premium or pay the fine. They may choose to pay the increased premium because they don't want to be without insurance. If they do, they may also write their congressperson to modify the ACA. klee12
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