It is set up with the endorsement and cooperation of the California government. They were allowed to dictate the terms of coverage that carriers could offer. They were allowed to bully the carriers into keeping their costs down, which resulted in a “narrowing” of networks, which has caused all sorts of confusion in the market. And now…they are facing calls for a state investigation of its contracting practices, after disclosure of the release of $184 million in contracts that did NOT involve competitive bidding.
Covered California was given the ability to negotiate no bid contracts to meet necessary deadlines in 2010…but now it is 2014 and they are continuing to use this ability to meet “deadlines” – but what are they? Recently, Covered California awarded $184 million in no bid contracts, which coincidentally included deals worth millions to a firm with workers having strong ties to the Covered California Executive Director Peter Lee. The new no bid contracts represent 20% of the amount of money Covered California has awarded to outside agencies. According to Peter Lee, he needed to move fast and “needed experienced individuals who could go toe to toe with health plans and bring to our consumers the best possible insurance value” So he couldn’t bid it? He has had four years…