The failed Oregon Exchange and how bureaucracies work. Huge failure leads to bonuses.

Obamacare Employees Behind Failed Oregon Exchange Now Getting Cushy Bonuses

Now that Oregon’s Obamacare exchange has entirely given up on fixing or running its own Obamacare website, the state exchange is handing out hundreds of thousands of dollars in taxpayer funding as bonuses to employees that stick around until the federal government takes over.

“Many of the employees who voluntarily left Cover Oregon had key skills that are not easily replaced both in IT and in health care laws and regulations,” interim director Clyde Hamstreet wrote to the exchange’s board, Oregon Live reports. “We cannot afford to keep losing valuable employees if we are to complete the workload for the remainder of 2014 and the IT transition project.”

Thirty-eight employees will be awarded bonuses worth one to three months pay to convince them to stay on with the exchange through the next nine months. All remaining 163 employees will be eligible for a bonus worth two weeks of government pay if they remain at the exchange through March 15.

In the months since Oregon officials announced they would be shutting down the exchange and allowing the federal government to take over and run a marketplace through HealthCare.gov, Cover Oregon lost 30 percent of its employees. Hamstreet expects the bonuses to cost another $650,000 of federal taxpayer funding.

The General Accountability Office is investigating Cover Oregon’s use of taxpayer funding at the request of several Oregon representatives. The state-run exchange was awarded $305 million of federal taxpayer funding to create its state-run exchange, which it abandoned in April, and has so far spent over $250 million.

The exchange never launched a functional website which was able to enroll customers online, a problem which the state blames on its contractor Oracle. The company’s officials recently alleged that they did create a website which supported online enrollment — but that Democratic Gov. John Kitzhaber, who’s running for reelection in November, chose not to launch it for political reasons. (RELATED: Oregon Obamacare Contractor Claims Dem. Governor Dumped Working Website Over Politics)