A Health and Human Services official has resigned after dealing with the frustration of the “profoundly dysfunctional” federal bureaucracy, which left him “offended as an American taxpayer.”

◼ HHS official resigns, pens a must-read rebuke of federal bureaucracy - Caroline May/Daily Caller

...“As for the rest, I’m offended as an American taxpayer that the federal bureaucracy — at least the part I’ve labored in — is so profoundly dysfunctional. I’m hardly the first person to have made that discovery, but I’m saddened by the fact that there is so little discussion, much less outrage, regarding the problem. To promote healthy and productive discussion, I intend to publish a version of the daily log I’ve kept as ORI Director in order to share my experience and observations with my colleagues in government and with members of the regulated research community,” he wrote.

ObamaCare's Secret Mandate Exemption

◼ HHS quietly repeals the individual purchase rule for two more years. - Wall St. Journal

ObamaCare's implementers continue to roam the battlefield and shoot their own wounded, and the latest casualty is the core of the Affordable Care Act—the individual mandate. To wit, last week the Administration quietly excused millions of people from the requirement to purchase health insurance or else pay a tax penalty.

This latest political reconstruction has received zero media notice, and the Health and Human Services Department didn't think the details were worth discussing in a conference call, press materials or fact sheet. Instead, the mandate suspension was buried in an unrelated rule that was meant to preserve some health plans that don't comply with ObamaCare benefit and redistribution mandates. Our sources only noticed the change this week....

Keep in mind that the White House argued at the Supreme Court that the individual mandate to buy insurance was indispensable to the law's success, and President Obama continues to say he'd veto the bipartisan bills that would delay or repeal it. So why are ObamaCare liberals silently gutting their own creation now?

The answers are the implementation fiasco and politics. HHS revealed Tuesday that only 940,000 people signed up for an ObamaCare plan in February, bringing the total to about 4.2 million, well below the original 5.7 million projection. The predicted "surge" of young beneficiaries isn't materializing even as the end-of-March deadline approaches, and enrollment decelerated in February.

Meanwhile, a McKinsey & Company survey reports that a mere 27% of people joining the exchanges were previously uninsured through February. The survey also found that about half of people who shopped for a plan but did not enroll said premiums were too expensive, even though 80% of this group qualify for subsidies. Some substantial share of the people ObamaCare is supposed to help say it is a bad financial value. You might even call it a hardship.

DRUDGE HEADLINES:
Pop Singer Lance Bass Visits White House to Discuss ObamaCare...
OK Man Loses Insurance Due to Law, Owes $100K in Bills...
900,000 Obamacare 'enrollees' still haven't paid for coverage?
42-sign ups a minute needed to reach goal...
OR exchange fails to attract young...
FLASHBACK: Feds drop $3.2m on ads featuring guitar-strumming hipsters...
WSJ: Secret Mandate Exemption...
HHS: We Lack 'Statutory Authority' to Extend Open Enrollment Period...
RUBIO: Dem goal is single-payer system...

HHS searching for malware from Belarus in Obamacare software... “Every shred of data one would need to steal your identity or access your confidential credit information would be available at the fingertips of a skilled hacker, producing a staggering security threat”

◼ The Belarusian Connection: Obamacare network vulnerable to cyber attack - Washington Free Beacon

U.S. intelligence agencies last week urged the Obama administration to check its new healthcare network for malicious software after learning that developers linked to the Belarus government helped produce the website, raising fresh concerns that private data posted by millions of Americans will be compromised.

The intelligence agencies notified the Department of Health and Human Services, the agency in charge of the Healthcare.gov network, about their concerns last week. Specifically, officials warned that programmers in Belarus, a former Soviet republic closely allied with Russia, were suspected of inserting malicious code that could be used for cyber attacks, according to U.S. officials familiar with the concerns....

Officials disclosed the software compromise last week after the discovery in early January of statements by Belarusian official Valery Tsepkalo, director of the government-backed High-Technology Park (HTP) in Minsk.

Tsepkalo told a Russian radio station in an interview broadcast last summer that HHS is “one of our clients,” and that “we are helping Obama complete his insurance reform.”

“Our programmers wrote the program that appears on the monitors in all hospitals and all insurance companies—they will see the full profile of the given patient,” Tsepkalo said June 25 on Voice of Russia Radio.

White House National Security Council spokeswoman Caitlin Hayden said an intelligence report on the Belarusian software was “recalled by the intelligence community shortly after it was issued.”

...House Permanent Select Committee on Intelligence Chairman Rep. Mike Rogers (R., Mich) said he was surprised by media reports from Belarus indicating “some parts of Healthcare.gov or systems connected to it may have in fact been written overseas.” He called for an independent security review of the Obamacare website.

Rogers said he was especially concerned by the potential software vulnerability because a CGI executive, Vice President Cheryl Campbell, testified to Congress that all software work for the network had been done in the United States.

“We need an independent, thorough security evaluation of this site, and we need the commitment from the administration that the findings will be acknowledged and promptly addressed,” Rogers told the Free Beacon.

“I continue to call on HHS to shut down and properly stress test the site to ensure that consumers are protected from potential security risks from across the globe.”

...According to HHS, between Oct. 1 and the end of the year, 1. 9 million people signed up for healthcare through the federal website. Another 956,000 enrolled through state websites. More than 55 million people visited both the federal and state websites.

The threat of data diversion is compounded by the discovery last year that Belarus covertly diverted massive amounts of U.S. Internet traffic to Belarus.

According to the New Hampshire-based security firm Renesys, which discovered the data diversion, throughout February 2013, Internet traffic from the United States was sent to Belarus. The purpose likely was to allow hackers or government agencies to sift for data for financial, economic, or government intelligence.

◼ Obamacare data hub looms as privacy threat - USA Today Rep. Mike Rogers, chairman of the House Intelligence Committee.

Union leaders wrote a letter to Harry Reid and Nancy Pelosi, warning of “nightmare scenarios” for millions of union workers' health plans if Obamacare is not changed. “Congress wrote this law; we voted for you,” they wrote. “We have a problem; you need to fix it.”

◼ Health and Human Services quietly giving unions Obamacare fix - Susan Crabtree/Washington Examiner

he Obama administration has found a way to give unions relief from an Obamacare tax nearly three weeks after Republicans rejected a Democratic push to include the labor carve-out in the latest budget deal.

The Department of Health and Human Services quietly released a final rule last week that includes an intention to exempt some union insurance plans from a substantial new tax known as the reinsurance fee.

As part of Obamacare, the tax was supposed to be levied against all insurance plans to share the risk for insurers taking on the sickest patients next year.

...“It's outrageous that the Obama administration is ignoring the plain language of the law he insisted on to deliver another bailout to the union bosses,” said Fred Wszolek, spokesman of the Workforce Fairness Institute. “Either follow the law and tax every insurance plan, or repeal the whole thing, but there's no legal basis for another expensive favor for big labor.”

The reinsurance fee is $63 per person covered by an insurance plan per year, and is expected to raise $25 billion over three years. Exempting unions in 2015 and 2016 from the tax would protect their plans from taking a major hit, although they would have to pay it in 2014, when the tax will be the greatest during the first year Obamacare is in effect.

HHS didn't immediately respond to a request for comment.

Scandal number five (Six? Seven?): Insider-trading probe of Medicare announcement reveals hundreds of HHS employees had secret info

◼ Is this scandal number five or number six? There’s Benghazi, the IRS, the DOJ snooping on reporters, Sebelius shaking down health executives for ObamaCare contributions, and now the NSA/PRISM/Snowden mega-clusterfark. This new WaPo story makes six. No, wait — seven. - HotAir

Ed just posted on the State Department covering up misconduct. We’re going to need a bigger boat.

Actually, there are two potential scandals here. One is HHS tossing around what was supposed to be sensitive information to a huge swath of employees in-house. The other scandal is who actually leaked it, assuming anyone did. It might not have come from HHS at all but rather from some old-fashioned Beltway congressional/lobbyist incest. As with most of the other Obama scandals, this story is less about O himself than about the foreseeable abuses that result as the federal whale grows. You can have bigger government or you can have more accountable government. The guy who signed ObamaCare into law has made his choice.

Sen. Charles E. Grassley (R-Iowa) told The Washington Post late last week that his office reviewed the e-mail records of employees at the Department of Health and Human Services and found that 436 of them had early access to the Medicare decision as much as two weeks before it was made public…

“In the statistical agencies, where the handling of sensitive information is their bread and butter, they’re very serious about confidentiality,” said Keith Hall, a former commissioner at the Bureau of Labor Statistics who has spent more than two decades in government. “But in other parts of the government that handle policy issues, there’s a whole different level of treatment.”

Hall said employees in other parts of the government, including the Medicare office, are not subject to the same types of potential consequences as employees at statistical agencies, who can land in prison for up to five years and face a fine of a quarter of a million dollars for disclosing information early.

Giving hundreds of government employees advance notice of a policy decision “is way too many,” said Hall, now a senior fellow at George Mason University’s Mercatus Center. “I’ve done my share of working on policy issues and policy decisions, and you just don’t spread that stuff around like that.”

Obama Guts Welfare Reform

◼ Today, the Obama Department of Health and Human Services (HHS) released an official policy directive rewriting the welfare reform law of 1996. - Heritage

The new policy guts the federal work requirements that were the foundation of the reform law. The Obama directive bludgeons the letter and intent of the actual reform legislation....

The new welfare dictate issued by the Obama Administration clearly guts the law. The Administration tramples on the actual legislation passed by Congress and seeks to impose its own policy choices—a pattern that has become all too common in this Administration.

The result is the end of welfare reform.

◼ http://www.acf.hhs.gov/programs/ofa/policy/im-ofa/2012/im201203/im201203.html

HHS pushes out cash ahead of ruling

◼ Conservatives wanted the White House to stop spending on the health care law until the Supreme Court rules on whether it’s constitutional.

But the administration has forged ahead, spending at least $2.7 billion since oral arguments in the case ended on March 28. That’s more than double the amount that was handed out in the three-month period leading up to the arguments, according to a POLITICO review of funding announcements from the Department of Health and Human Services.

While much — if not all — of this funding was in the pipeline well before March, the timeline for handing out specific funds is not set in stone, which gives the agency leeway over the kinds of dollars it has been handing out.

And the stakes have increased as the date of a Supreme Court ruling approaches, because money that is spent won’t have to be repaid, most likely. But remaining funds will dry up if the court strikes down the law.

The court is expected to announce its decision next week.

The $2.7 billion includes grants and awards that have been handed out since the Supreme Court arguments — including more than $90 million in funds for health insurance cooperatives that HHS announced Friday afternoon.

By contrast, the administration gave out about $1 billion in grants, loans and other awards during the three months before the Supreme Court arguments.

HHS Admits Nearly $5 Million Spent on Implementation of CLASS Act Prior to Abandoning Program

◼ "After ignoring repeated warnings from budget experts and Congressional Republicans, HHS still spent nearly $5 million of taxpayers' hard-earned money to implement a program it now says has no `viable path forward.' As families across America continue to struggle financially, the Obama Administration has wasted nearly $5 million on a failed program. - Senator John Thune

Thune introduced his Repeal the CLASS Entitlement Act (S.720) in April and the bill currently has 34 co-sponsors.