CalOptima Board Shows Confusion Over Conflicts of Interest

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The CalOptima board of directors last week unanimously re-elected its chairman and vice chairman but struggled with apparent confusion on a separate issue when three members tried to determine whether they had conflicts of interest.

Mark Refowitz, head of the Orange County Health Care Agency, was re-elected CalOptima board chairman, and Lee Penrose, president and CEO of the St. Jude Medical Center in Fullerton, remains vice chairman. There were unopposed.

“I’ll be your wing man anytime,” Penrose told Refowitz.

CalOptima is the $1.5-billion health plan for about 440,000 county residents, including about one-third of all Orange County children as well as disabled and low-income elderly adults.

In addition to the board appointments, members voted on an extension of some health network contracts. The item was one of three on the agenda’s consent calendar, a list of normally noncontroversial issues.

But when the consent calendar came up on the agenda, two board members who are part of health networks — doctors Viet Van Dang and Samara Cardenas — said they wanted to abstain from the vote after being told by board clerk Suzanne Turf that they had conflicts. Turf also mentioned Penrose, whose hospital is part of the new Covenant Health Network.

But Penrose turned to CalOptima attorney Gary Crockett and questioned whether he actually had a conflict.

“I don’t believe you have a conflict,” Crockett said.

There was then more confusion, because Crockett suggested the board vote on all three consent calendar items as a group, with Dang and Cardenas abstaining. For a few minutes, board members turned to each other in uncertainty because they already had voted to approve the other two consent items. Ultimately, the third item was approved.

In the past, members of the CalOptima board rarely declared a conflict of interest and abstained from voting on agenda items. But then in May the state Fair Political Practices Commission launched an investigation of four members of the Board of Supervisors and nine members of the CalOptima board of directors after a county grand jury report earlier this year that was highly critical of how CalOptima is run.

Among other issues, the FPPC is looking into conflicts of interest involving supervisors and CalOptima board members. Also the FBI has formed a task force with the Internal Revenue Service, district attorney and U.S attorney to investigate public corruption in Orange County.

Now it is apparent that board members are trying to create a system to ensure they are aware of items that may be a conflict.

Following the meeting, Refowitz and others said staff are notifying board members when they see an item on an upcoming agenda that might conflict with something a board member has listed on state-required conflict of interest forms known as Form 700s. Public officials are required to list investments, income and other financial connections that might come in conflict with their job duties. In those cases, officials abstain from voting.

Crockett said that in addition to staff tracking potential conflicts for board members, the members are raising issues themselves when they are concerned they may have a conflict.

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

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