An anonymous letter sent to the CalOptima board of directors Thursday accuses two board members — Chairman Ed Kacic and Mary Anne Foo — of improprieties, allegations both strongly denied.
The faxed letter stated verbatim: "Kasic is using his position as chair and member of the CalOptima board to steer millions of dollars the agency funds to his foundation." The sentence was written all in capital letters.
It went on to allege that Foo "accepts pay for working for CalOptima while working on its board."
Both Foo and Kacic said the charges have no basis in fact.
"This appears to be another episode in an effort to cause damage to CalOptima," Kacic said. "I want to send it to the whole world with the explanation that someone is trying to smear me and someone is trying to smear Mary Anne and CalOptima."
He was supported by Ruth Kurisu, executive director of Managed System of Care, a 2-year-old organization created by the county's medical establishment to provide more care to low income and elderly residents than CalOptima alone can offer.
"What I'm reading here [in the anonymous letter] is just misrepresented, just totally false," said Kurisu. "We're [Managed System of Care] an organization that's trying to do the right thing. To have something like this happen is appalling."
The letter was the latest in an ongoing drama involving the $1.4-billion health care plan for Orange County's poor and elderly. Late last year, Orange County Supervisor Janet Nguyen began an ultimately successful effort to remake the CalOptima board, expanding it from nine members to 11, including three government seats and as many as five industry representatives.
Nguyen leveled a series of nonspecific criticisms at the health plan. CalOptima, however, has also received a number of commendations for its operations.
And lately, a number of high-level officials have left the agency for private industry or bigger government jobs, the most recent being CEO Richard Chambers. He announced this week that he is leaving the agency in April to accept a job with Long Beach-based Molina Healthcare California.
The anonymous letter apparently was faxed to all CalOptima board members and at least two news organizations, which began asking questions.
Kacic, president of the Irvine Health Foundation, said his organization belongs to the Managed System of Care, a group that includes the CEOs of all Orange County hospitals, the county Health Care Agency, the Veterans Administration, CalOptima, clinics, major medical groups and business interests.
He said his foundation acted as an intermediary on behalf of the whole group in a $9.7-million federal grant application. If awarded, the three-year grant would be used to find new ways to improve care and save money in local programs for those with low income, including analyzing what is being done in other parts of the country.
If the grant is approved, the announcement will be made around the end of March.
But, Kacic said, he specified up front that his organization wouldn't accept any of the grant money and would act only as an intermediary, because the Managed System of Care group isn't incorporated officially as a nonprofit and couldn't apply on its own.
Kacic said he told the leaders of Managed System of Care that if the grant is approved, they must either create their own nonprofit or designate another nonprofit to actually receive the grant.
And, he said, the Irvine Health Foundation is a financial contributor to the Managed System of Care.
"There was no financial gain to Irvine Health Foundation whatsoever," said Kurisu. "Everybody understood that. Everyone approved that. Ed made a very public statement."
In addition to telling the Managed System of Care officials and federal authorities his foundation would refuse to benefit from any of the grant money, Kacic said he recused himself when the CalOptima board discussed a separate project involving he managed system of care. The board never voted on that issue.
Foo is the executive director of the Orange County Asian and Pacific Islander Community Alliance. The group provides programs for low-income people, such as after-school projects, college preparation programs for homeless students, health education and cancer prevention.
But Foo said she was never paid by CalOptima while on the board. She worked for the agency more than 10 years ago shortly after leaving graduate school but has not been paid by them since.
She did say that CalOptima contributed $2,500 to a fundraiser her organization sponsored last year. CalOptima provides similar support to other groups that help individuals and families in need.
Correction: A previous version of this story incorrectly described the purpose of a grant for the Managed System of Care that the Irvine Health Foundation was the intermediary for. We regred the error.