Oregon Settles with Oracle Over Cover Oregon Fiasco

After more than one year of fighting, Oregon and Oracle have settled six lawsuits that stemmed from the Cover Oregon health exchange website fiasco. The settlement is worth more than $100 million - most of it in the form of technology.

Oracle had been the company behind the Cover Oregon website that never worked, a series of snafus that contributed to the downfall of former Governor John Kitzhaber, who left office in 2014.

Kitzhaber had urged Attorney General Rosenblum to sue Oracle over the failure of the website, which she did - seeking more than $6 billion in damage.

The state had paid Oracle $240 million and spent more than $16 million to four law firms to fight the company.

"Today's settlement agreement ends years of turmoil and taxpayer expense related to a troubled health exchange program I dissolved in March 2015,” Governor Brown said on Thursday.

“Since the demise of Cover Oregon, we have helped nearly 98 percent of Oregon children and 94 percent of adults obtain health care coverage – now, let’s focus on getting to 100 percent."

The settlement includes $25 million cash as well as a six-year Unlimited License Agreement (ULA) for products and services that can be leveraged by the Legislature to significantly modernize state government's IT systems, potentially saving the State hundreds of millions of dollars.

The agreement also calls for $60 million in free customer service support, a $10 million grant for science, technology, engineering and math (STEM) programs in Oregon schools.

"This settlement outcome is a "win-win" for the people of Oregon—without the expense and continued impact on our collective psyche," said Rosenblum. "But, the beauty of the deal is that if we choose to take full advantage of the free ULA's, we are uniquely situated to modernize our statewide IT systems over the next six years—something we could not otherwise afford to do.

"It is a creative solution that allows us to take advantage of Oracle's suites of products that already serve several Oregon state agencies well, and are used by the majority of other state governments.”

While the state had won several early rounds against Oracle - include successfully keeping the case from being moved to federal court from state court - there was no guarantee that the state would prevail.

The first trial had been scheduled to begin in January.

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