ACA Problems Call For Corporate Crisis Management

The ACA debacle keeps getting worse. Backtracking on promises makes the optics even worse. California operates its own exchange but still denies plans that don’t meet federal standards. Some hospitals are opting out of other state exchange plans. Sticker shock is spreading to older demographics that were supposed to benefit from better coverage. Doctors are increasingly alarmed at the financial disincentives they’ll face in providing care to more patients. The federal ACA exchange and its supporting mandates for state plans are the equivalent of a private corporation’s major product rollout. This product is not delivering affordable value and its entire supply chain among care providers is gradually shutting down.

A corporate CEO facing multiple problems from a single product roll-out would have a crisis management plan in motion. The best crisis management case in corporate history was Johnson & Johnson’s response to the Tylenol poisonings of 1982. The company issued a nationwide recall of its entire product line for that brand and went public with messaging not to consume its product. That decisive action saved the brand in the minds of consumers.

Business theory doesn’t match government reality. I don’t get the sense that the federal government is treating the ACA’s national exchange rollout as a product crisis to be solved. Contractors are working hard on fixes to the website but the messaging has reverted to clarifying past promises. The messaging on how the product fix is progressing is overwhelmed by noise on who promised what way back when. No amount of messaging can overcome a poorly performing product. A malfunctioning exchange website that does not deliver service, process payment, or protect against fraud will harm the consumers it was meant to help.

About Anthony Alfidi 128 Articles

Affiliation: Alfidi Capital LLC

Anthony Alfidi is the Founder and CEO of Alfidi Capital. His firm publishes free investment research with honesty and humor.

Mr. Alfidi holds a Bachelor's degree in human resource management from the University of Notre Dame (cum laude) and an MBA in finance from the University of San Francisco. He is a life member of Beta Gamma Sigma, the academic honor society for business majors. He has been a private investor since the 1990s.

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