CalOptima Board to Consider Detailed Audit of Its Operations

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The CalOptima board of directors Thursday will consider hiring Deloitte & Touche, one of the world’s largest accounting firms, to conduct a comprehensive audit of the $1.3-billion county health care provider.

The recommendation for a full audit was made in a preliminary confidential report to the board that was revealed last month by the Orange County Register.

The preliminary report by Woodland Hills health care consultant Arthur S. Shorr warned that CalOptima, which serves 422,000 low-income members, could face serious problems in the future if it didn’t make changes.

CalOptima CEO Richard Chambers is recommending a maximum of $250,000 be spent for Deloitte & Touche to conduct “an independent and comprehensive” audit.

“Consistent with management’s obligation to ensure that members receive appropriate care and that public funds are appropriately managed, staff recommends broadening the scope of the Deloitte engagement to perform an immediate and detailed investigation and evaluation of these [Shorr report] concerns,” the agenda item reads.

Orange County Supervisor Janet Nguyen has been pushing to change CalOptima operations and give more control to health care providers and county government. Last month the Board of Supervisors voted 3-2 to change the composition of the CalOptima board and give the supervisors’ representative a two-year term. Nguyen is the current representative.

CalOptima recently hired Deloitte & Touche as its internal auditor. The system-wide examination of CalOptima would be added to the new contract, according to the agenda item.

Deloitte would provide monthly updates to the board, and the report would be finished no later than May. The updates would be public except for information such as specific personnel issues, which state law allows the board to discuss in private.

The decision on whether to conduct the full audit comes as two of CalOptima’s top executives announced their resignations, one headed for private industry and the other to oversee all of California’s Medi-Cal programs.

Dr. Greg Buchert, CalOptima’s chief operating officer, will become a principal consultant at Michigan-based Health Management Associates, an independent national research and consulting firm that specializes in health policy issues.

Margaret Tatar, CalOptima executive director of public affairs, is moving to Sacramento to become head of the Managed Care Division of the Department of Health Care Services. She will direct all California Medi-Cal programs, including CalOptima, for 3.5 million recipients. In addition, the Managed Care Division audits the performances of each county program.

Buchert has been with CalOptima since it began serving low-income families, seniors and people with disabilities 15 years ago. He was traveling in Asia this week and could not be reached for comment.

In a Dec. 22 memo to the CalOptima board announcing Buchert’s resignation, Chambers wrote “as he [Buchert] describes it, he will be ‘keeping up the campaign for excellence in managed care,’ as he will have the opportunity to guide many organizations to the next generation of Medicaid development.”

CalOptima spokesman Laer Pearce said Buchert was recruited by Health Management Associates beginning last summer.

Tatar, a lawyer who isn’t a member of any political party, has been the executive director of public affairs at CalOptima since 2003. Previously she was with the county Office on Aging, a district staff member for former Republican Assemblywoman Lynn Daucher of Brea, and a senior attorney for the Colorado Legislature.

Her new position pays $122,196 a year and doesn’t require state Senate confirmation.

In a CalOptima news release last month announcing her departure, board Chairman Edward B. Kacic said “the state’s selection of Margaret for this position says a lot about her — and a lot about the respect CalOptima has earned throughout the state.”

Tatar said the recent controversy at CalOptima wasn’t a factor in her decision to leave. “I don’t mean to be dismissive of those things, but no, it wasn’t about that,” she said.

She was attracted by the challenges ahead, she said. The new national health plan is scheduled to take effect in two years, and health organizations nationwide are preparing to handle more patients.

A previous version of this story incorrectly stated the location of the corporate headquarters of Michigan-based Health Management Associates. We regret the error.

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

 

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