WASHINGTON -- In May 2010, two months after the Affordable Care Act squeaked through Congress, President Barack Obama’s top economic aides were getting worried. Larry Summers, director of the White House’s National Economic Council, and Peter Orzag, head of the Office of Management and Budget, had just received a pointed four-page memo from a trusted outside health adviser. It warned that no one in the administration was "up to the task" of overseeing the construction of an insurance exchange and other intricacies of translating the 2,000-page statute into reality.
Summers, Orzag and their staffs agreed. For weeks that spring, a tug of war played out inside the White House, according to five people familiar with the episode. On one side, members of the economic team and Obama health-care adviser Zeke Emanuel lobbied for the president to appoint an outside health reform "czar" with expertise in business, insurance and technology. On the other, the president’s top health aides — who had shepherded the legislation through its tortuous path on Capitol Hill and knew its every detail — argued that they could handle the job.
In the end, the economic team never had a chance: The president had already made up his mind, according to a White House official who spoke on the condition of anonymity in order to be candid. Obama wanted his health policy team — led by Nancy-Ann DeParle, director of the White House Office of Health Reform — to be in charge of the law’s arduous implementation. Since the day the bill became law, the official said, the president believed that "if you were to design a person in the lab to implement health care, it would be Nancy-Ann."
Three-and-a-half years later, such insularity — in that decision and others that would follow — has emerged as a central factor in the disastrous rollout of the new federal health insurance marketplace, casting doubt on the administration’s capacity to carry out such a complex undertaking.
"They were running the biggest start-up in the world, and they didn’t have anyone who had run a start-up, or even run a business," said David Cutler, a Harvard University professor and health adviser to Obama’s 2008 campaign, who was not the individual who provided the memo to The Washington Post but confirmed he was the author. "It’s very hard to think of a situation where the people best at getting legislation passed are best at implementing it. They are a different set of skills."
The White House’s leadership of the immense project — building new health insurance marketplaces for an estimated 24 million Americans without coverage — is one of several key reasons that the president’s signature domestic policy achievement has become a self-inflicted injury for the administration.
Based on interviews with more than two dozen current and former administration officials and outsiders who worked alongside them, the project was hampered by the White House’s political sensitivity to Republican hatred of the law — sensitivity so intense that the president’s aides ordered that some work be slowed down or remain secret for fear of feeding the opposition. Inside the Department of Health and Human Services’ Centers for Medicare and Medicaid, the main agency responsible for the exchanges, there was no single administrator whose full-time job was to manage the project. Republicans also made clear they would block funding, while some outside IT companies that were hired to build the website, HealthCare.gov, performed poorly.