Orange County’s health coverage for low-income and disabled people is increasingly being placed in the hands of a powerful county supervisor and one of his top aides.
That kind of politicization has a history in Orange County, prompting some influential local health care leaders to raise alarm bells.
“We’ve seen that play before. And it doesn’t end very well for the organization or our patients,” said Paul Yost, a doctor who was CalOptima’s chairman from 2017 until mid-2020.
On the heels of becoming chairman of CalOptima, which arranges billions of dollars per year in contracts with medical providers across the region, Supervisor Andrew Do now has one of his longtime advisors arriving at a high-ranking staff position there.
Do’s deputy chief of staff Veronica Carpenter, who has less than a year of professional experience in healthcare administration, recently moved into a newly-created chief of staff role at CalOptima, which pays $282,000 plus benefits as a top advisor to the CEO.
Carpenter and Do didn’t return phone messages for comment. A CalOptima spokeswoman referred to a prior internal statement by Carpenter that she’s excited for her new role and looks forward to improving care for CalOptima’s members.
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CalOptima is Orange County’s largest health insurer, managing the publicly-funded health coverage of 850,000 low-income children, adults, seniors and people with disabilities.
That’s one in every four residents and one in every three children.
It was set up in the mid-1990s by a coalition of leaders seeking to bring community control to the federal health coverage funded by Medicare and Medicaid.
For years, county supervisors had little interest in serving on its board.
And the agency passed audits without major issues.
That changed about a decade ago.
In 2011, Do’s former mentor, state Assemblywoman Janet Nguyen, took over CalOptima while she was an elected county supervisor, prompting what a grand jury later described as a decimation of the agency’s professional leadership while she fundraised from a lobbyist she allowed to re-write CalOptima’s governing rules.
As part of that takeover, CalOptima’s leaders were replaced with people who lacked experience and didn’t understand the complex agency, the grand jury found.
Before Nguyen’s takeover, CalOptima was considered one of the best-run medical plans in the state. Previous federal audits of a key agency program had found no major problems.
But after the takeover and chaos described by the grand jury, the auditors found massive mismanagement and errors at CalOptima they called a “serious threat to the health and safety” of patients. Federal officials went so far as to order CalOptima to stop enrolling elderly people in the program.
The “widespread and systemic” failures included improperly denying prescriptions that were covered by the plan, refusing to pay for emergency services, not paying medical providers on time and not allowing patients and doctors to appeal denials of coverage.
Nguyen left CalOptima’s board in early 2014, and after the federal intervention, state auditors said the following year they were impressed with improvements the agency made.
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Years later, Nguyen’s former chief of staff – Do – tried and failed to become CalOptima’s chairman and to take over its board.
Last year, however, Do succeeded in becoming the health plan’s chairman. And now one of his top aides is moving into a high-ranking staff position there.
Former CalOptima chairmen are raising alarms.
Yost, the former CalOptima board chairman, said CalOptima’s patients deserve a chief of staff who has more than a year of experience in healthcare management.
“First of all, it’s the largest insurer for patients in Orange County. And they are our neediest, most underserved patients,” Yost said.
“To me it’s very dangerous. I don’t think the patients in Orange County are going to be well served by that decision,” he added of Carpenter’s appointment, calling it “very concerning.”
Ed Kacic, who served as CalOptima’s chairman in 2011 and 2012 until Nguyen’s takeover, said he’s concerned about politicization and lack of experience among the health plan’s leadership.
“I have a concern when an elected official potentially gets too much influence at CalOptima,” Kacic said in an interview.
After Nguyen’s takeover, he said, “CalOptima was damaged by the politicization and the loss of massive amounts of executives and significant numbers of supervisorial staff who also left.”
“I think the politicization has continued – and not for the better,” Kacic said.
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CalOptima’s interim CEO says Carpenter is well qualified, noting her experience working for Do and about a year each at the county agencies for public health and social services.
“Bringing more than four years of experience as a Deputy Chief of Staff and health care advisor, Veronica Carpenter is highly qualified for CalOptima’s Chief of Staff position,” said Interim CEO Michael Hunn in a statement to Voice of OC.
“Moreover, her experience at the Orange County Health Care Agency and Orange County Social Services Agency further enhances her ability to play a key role in our partnerships with community stakeholders,” he added.
“I look forward to having her on the leadership team as she is already familiar with CalOptima’s key initiatives in support of our mission and members.”
County human resource records show Carpenter started at the county in 2013 as a county supervisor’s political aide working on the fifth floor of the Hall of Administration.
Yet just two years later, she transferred into the county bureaucracy.
At the Health Care Agency, Carpenter worked as an assistant to the agency director overseeing strategic communications and special projects.
A short nine months later, she transferred into a seemingly lower-profile job at the Social Services Agency where she worked as an administrative manager for slightly over a year.
Then, in April 2017, just after Do was elected to his first term in office, Carpenter moved back up the fifth floor at the county Hall of Administration where she would serve as one of Andrew Do’s senior political advisors, serving as his deputy chief of staff for over four years until moving to CalOptima this month.
Voice of OC requested comment about Carpenter’s hiring from the CalOptima board through the agency’s spokeswoman, but did not receive any responses.
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CalOptima did not hire a national search firm to recruit for the chief of staff position, which Yost said deviates from their standard practice.
“Usually you would do a national search to get the very best individual in that spot,” Yost said.
“This seems kind of strange and outside the normal process one would go through.”
CalOptima spokeswoman Janis Rizzuto said the agency did not do a national search, but did post the position in November and accept applications for two weeks before extending an offer to Carpenter.
There was one other candidate the agency spoke to, according to Rizzuto, who declined to provide their name, citing “professional confidentiality.”
CalOptima’s spokeswoman didn’t return a follow-up question asking if the job qualifications – which closely match Carpenter’s resume – were written for her.
Carpenter’s hiring into the high-level role comes as CalOptima’s board prepares to pick a permanent CEO to replace former CEO Richard Sanchez, who quit after just a year on the job.
There’s been widespread reports that Do wants to move county Health Care Agency Director Clayton Chau into the CalOptima CEO job, something that would require majority support from the health plan’s board, where Do serves as chairman.
So far, Do and Chau have declined to comment on whether Chau would be moving to CalOptima.
Nick Gerda covers county government for Voice of OC. You can contact him at ngerda@voiceofoc.org.