California keeps exchange contracts, records under lock and key

The California agency responsible for developing and running the health insurance exchange has been extremely secretive about its contracts and records, keeping information about hundreds of millions of dollars it has spent away from the public--and insurers selling plans on the exchange.

Covered California has been afforded a level of secrecy not provided in the other 16 states creating their own online marketplaces, according to a review by the Associated Press.

When state lawmakers set up the California exchange, they authorized it to keep all contracts private for a year while the amounts paid for those secrets could be kept confidential indefinitely. That means the public can't see how Covered California is spending almost $458 million on outside vendors, including lawyers, consultants and public relations advisers.

For example, Covered California has said retail stores may be the best avenue to reach uninsured consumers, as FierceHealthPayer previously reported, but the agency doesn't have to disclose how much money it pays retailers to help market and promote the exchange.

The agency also doesn't have to make public exchange records that reveal recommendations, research or strategy of the board or its staff. Plus, any records containing instructions, advice or training to employees as well as board meeting minutes are exempt from disclosure, according to the AP.

But Californians Aware, a group that promotes government transparency, says Covered California might actually be violating the state constitution. To explicitly exclude certain records from public disclosure, the legislature must demonstrate the need for shielding such information from the public. But the bill that authorized the exchange only included two sentences that addressed exempting records from disclosure, stating that the secret spending was "necessary" to protect "powers and obligations to negotiate on behalf of the public."

Exchange spokesman Dana Howard, however, said Covered California complies with state law. But he wouldn't discuss specifics about how the agency determines what is public and what is not, the AP noted.

To learn more:
- read the Associated Press article

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