"I think it's going to get worse before it gets better," the governor told KBOI News.
Idaho is currently relying on federal software to enroll people in coverage via its Your Health Idaho insurance exchange.
"We checked from time to time to make sure it was going to be up and running and that they'd be able to support our exchange system with their (federal) informational system," Otter said, "but it just didn't happen."
Otter, never a supporter of the president's Affordable Care Act, calls the roll out of the program "a disaster" full of "failed promises".
In a letter Wednesday, Otter told U.S. Health and Human Services Secretary Kathleen Sebelius that problems with the federal software are of such magnitude, many Idaho residents likely won't be able to complete enrollment before March 31, when they'll face a fine under President Obama's health care overhaul.
"And yet we've got penalties... that Obamacare is going to put on people for not buying something the exchange isn't ready sell them," Otter said.
He said people should be upset.
"I'm upset," he added.
Otter insists another year will allow exchange officials here to complete Idaho's own enrollment system - one he hopes won't be plagued by the enormous troubles that have dogged 36 states using federal exchanges.
Idaho is using the federal support system for now because the state legislature delayed a decision on whether to create its own insurance exchange or let the feds run the show.
(The Associated Press contributed to this story.)