Could Nguyen’s Gambit to Reshape CalOptima Backfire?

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Monday, Nov. 7, 2011 | Orange County Supervisor Janet Nguyen has gotten her wish to make CalOptima an issue before her colleagues on the Board of Supervisors, as the board will be getting an 18-page PowerPoint presentation on the program at its meeting Tuesday.

It is far from clear, however, whether the presentation will help Nguyen achieve her goal of a sweeping realignment of the board governing the $1.5-billion health care program for the poor in Orange County.

In fact, the renewed focus on CalOptima in recent weeks seems to have shown the current structure’s strengths rather than reveal its weaknesses.

Nguyen ignited a firestorm of controversy last month when, with no studies or other in-depth information, she took aim at CalOptima’s nine-member board of directors.

Her initial plan stripped the poor of most of their representatives and heavily weighted the board in favor of government, business and providers, including hospitals and doctors. Nguyen now says she is modifying her restructuring plan and a new proposal should be ready later this month.

The current board has seven volunteer members and two who serve as part of their regular jobs. Those two are Nguyen and David Riley, the director of the county’s Health Care Agency.

After Nguyen made CalOptima an issue, two of her colleagues, Chairman Bill Campbell and Supervisor Pat Bates, acknowledged they knew little about how the organization works.

CalOptima is a county agency that uses federal and state money, but no county funds, to provide for patients covered by the federal Medicaid and state Medi-Cal programs.

Although it’s not mentioned on the PowerPoint slides, CalOptima claims the third lowest administrative cost ratio (4.36 percent) among all health plans in California.

It also is the largest county-organized health system in California and the fifth largest Medi-Cal managed care plan in the state. It serves more Medicaid recipients than 18 state programs.

At the CalOptima board meeting last week, the staff delivered the news that CalOptima’s OneCare plan for 13,000 Medicare and Medi-Cal special-needs adults was given a four-star “above-average” Medicare rating for 2012.

Only four of the other 41 Medicare Advantage plans in Orange County received a four-start rating, according to a news release. The top rating is five stars and nationwide only nine plans reached that level. The plan’s previous rating was 3.5.

The staff also reported that CalOptima will receive one of the state’s highest ratings on care and service.

Nguyen never has explained what is driving her efforts to change the composition of the CalOptima board. At one point she said she’d received numerous complaints about the program. Statistics kept by CalOptima, however, showed only five complaints were submitted during the past four months by all five supervisors, plus members of the state Legislature and House of Representatives.

Nguyen has also said that implementation of the new national health care plan in 2014 will add more than 100,000 patients to the system and the county needs to be prepared. But she has never explained why medical providers and potentially related businesses need to control the board.

Hospitals, which are seeking a permanent seat on Nguyen’s new board, have complained that they have to absorb too much of the costs of care for the indigent, particularly those who visit emergency rooms.

In addition to hospitals, clinics and medical groups as well as doctors have said they want permanent representation on Nguyen’s new board.

But critics worry that without a factual foundation to justify the changes, the Board of Supervisors may be opening CalOptima to new problems.

Fraud by Medicare and Medi-Cal providers costs taxpayers $60 billion a year, and federal officials designated the Los Angeles area one of nine “hotspots” where special provider fraud investigation teams have been established.

The concern isn’t just for the membership of the new board, but for whatever selection process Nguyen and her colleagues put into place for nominating new members of the board.

If done wrong, the new system could be used to put relatives, friends and business cronies of those in charge on the payroll or in positions to award contracts or other lucrative benefits to associates, critics say.

Nguyen acknowledges she is just learning how CalOptima works after being named the board’s representative in January.

“I’m not in this field,” she reminded the CalOptima board last week. “I don’t do it daily. I’m playing catch-up.”

She said when she raised the issue of complaints, she was unaware there was a complaint hot line to which she could have referred constituents.

“I didn’t know we had a system like that,” she said. “Again, learning something new each day.”

Clarification: A previous version of this story did not make it clear that Supervisor Janet Nguyen serves on the CalOptima board as part of her job as supervisor.

Please contact Tracy Wood directly at twood@voiceofoc.org and follow her on Twitter: twitter.com/tracyVOC.

 

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