The president plans to nominate Sylvia Mathews Burwell, director of the Office of Management and Budget (OMB).
According to the Times, Sebelius notified Obama of her decision in early March. Before joining the Obama administration just after the president's first inauguration, Sebelius had served as governor of Kansas.
Sebelius' reputation in Washington, D.C., has been sullied by the months of technical glitches associated with the rollout of the federal healthcare law's insurance enrollment website, which experienced numerous technical glitches, causing delays to enrollment and highly publicized frustration by users.
"From day one, Secretary Kathleen Sebelius has remained laser-focused on a single purpose: to make health care a right, not a privilege, for all Americans. Her leadership has been forceful, effective, and essential," House Minority Leader Nancy Pelosi (D-Calif.) said in a statement.
Senate Republican Leader Mitch McConnell (R-Ky.), a critic of the healthcare law, called Sebelius's resignation "cold comfort to the millions of Americans who were deceived" about the healthcare law. "Secretary Sebelius may be leaving, but the problems with this law and the impact it’s having on our constituents aren’t. Obamacare has to go, too," he said in a statement.
Burwell has been at the helm of OMB for just under a year. She was confirmed by the Senate unanimously last April. The West Virginia native previously served as deputy budget director in the Clinton administration.