The U.S. Department of Health and Human Services won't renew its contract with Terremark Worldwide Inc. of Miami, Verizon's information technology subsidiary, as the Web-hosting provider for the federal health insurance marketplace, which serves 36 states, sources told the newspaper.
Verizon collected a total of $55.4 million for its contract work since 2011, including $9.4 million in November to increase capacity for the website, which has been plagued by crashes and outages at Verizon's data center, the Journal said.
The government solicited new bids for a contract to take over from Verizon, whose headquarters are in New York, as early as this spring, and the $38 million contract given HP, which has its headquarters in Palo Alto, Calif., was awarded this past summer.
An HHS official told the Journal the agency overseeing the marketplace "has begun the necessary activities to transition the data center over to HP. We are working to ensure a smooth transition between the two contractors."
HHS Secretary Kathleen Sebelius said Tuesday the HealthCare.gov website is "vastly improved" as a Saturday deadline for improvement approaches.
"I can tell you two things: That we are definitely on track to have a significantly different user experience by the end of this month -- that was our commitment -- than people experienced on Oct. 1," Sebelius said on a conference call with state and local officials.
"This isn't a magic turn on the on switch. The experience is vastly improved each and every day. We are seeing more and more enrollments each and every day," she said.
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