House panel calls for criminal probe into failed Oregon health care exchange

May 5, 2014: Screen grab from Cover Oregon's website (Cover Oregon)

Ex-Oregon Gov. John Kitzhaber and his staff mismanaged the creation of the state’s doomed health insurance website, including by making decisions based on his re-election campaign, according to a congressional report released Wednesday which seeks a criminal probe.

The House Oversight and Government Reform Committee report calls for the Department of Justice and state attorney general to conduct criminal investigations into the events surrounding the creation and eventual failure of Cover Oregon, which ultimately led to the waste of $305 million in federal money.

"More than $305 million in federal taxpayer dollars were sent to Oregon state for purposes of implementing a state exchange to benefit the people," the Republican-led committee said in a letter to U.S. Attorney General Loretta Lynch. "The state exchange never came to fruition, and the money is gone."

The report also found there has been no effort from the Department for Health and Human Services to retrieve the lost funds.

The report said that state officials improperly commingled official and political resources to enrich Kitzhaber’s re-election bid.

Democrats on the committee released their own report, which laid the blame at the feet of Oracle Corporation, the state’s contractor, saying it misled officials and failed to deliver a functioning website. The Democrats' report also found that Oracle’s work was so flawed the state should stop payments to them.

Oregon had the country's worst rollout of the national health insurance program. While the crippled federal website eventually worked, Oregon failed to enroll a single person online. The state-supported platform eventually was abandoned for the federal HealthCare.gov.

Cover Oregon was dissolved in March 2015.

The Centers for Medicare & Medicaid Services' "failed oversight of the development and implementation of Cover Oregon resulted in millions of wasted taxpayer dollars," the committee’s report said, calling for the reform of its grant and oversight process.

The report also found that state officials and Kitzhaber’s campaign staff collaborated to such an extent that the "lines between official and political activities became blurry.”

Kitzhaber resigned in February 2015 amid allegations his fiancee, Cylvia Hayes, did private consulting work for organizations seeking to influence state policies. The report found that at least one email discussing Cover Oregon included Hayes, "who did not have any Cover Oregon role or responsibilities."

Fox News’ Chad Pergram and The Associated Press contributed to this report.