SACRAMENTO (CBS13/AP) — A state lawmaker who is running for state insurance commissioner said Wednesday that he is suing California’s health benefits exchange for wrongly cutting off more than 1 million insurance policies and for what he called wasting taxpayer money on useless marketing campaigns.

Covered California violated federal and state laws by telling insurers that wanted to participate in the exchange that they must eliminate plans that fail to meet the higher standards of the federal Affordable Care Act, Sen. Ted Gaines, R-Roseville, alleges in a lawsuit filed in Los Angeles County Superior Court.

He claims the agency’s board violated the law a second time when it voted last November not to extend those policies after President Barack Obama made that option available.

“The President was very clear if you had a policy you liked you could keep it and these people were forced off their policies,” he said.

A spokesman for Covered California, James Scullary, said it would be inappropriate for the agency to comment before it has been served with the lawsuit.

Covered California says 829,000 Californians have enrolled in health insurance plans through the exchange, but it has acknowledged that more than 1 million policies could be eliminated. The number of those gaining coverage through the exchange is expected to rise as the March 31 enrollment deadline for the year approaches. Additionally, some of the people whose previous policies were cancelled are likely to have purchased new policies sold through Covered California.

Gaines, who also owns an insurance agency, said hundreds of millions of dollars in marketing and outreach have been wasted because fewer people overall will have insurance, given the cancellations. Millions more, he said, will be phased out next year when a new mandate takes effect that requires certain employers to offer coverage to employees.

Among the wasted money Gaines cited in the lawsuit are $106.2 million on outreach that “has failed to obtain significant enrollment, or a demographically or actuarially diverse enrollment,” more than $10 million on a contract with public relations firm Weber Shandwick and $1.3 million for an infomercial starring fitness guru Richard Simmons.

Gaines said in a conference call with reporters that he asked Covered California Executive Director Peter Lee to provide details on how much has been spent on marketing and outreach and for what, but “I didn’t get any clarity in terms of how that money is being spent.”

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  1. Are we a “3rd. world country”? NO! Then why are we ALL forced to get health care, when we can’t afford it? In my case, as I’m sure with others, it can be from a “long-term” work injury and your on a “FIXED” income, and can’t even pay your regular bills you once could, now getting your phone or power shut off due to “NON-PAYMENT”, because you had to “PAY” your medical insurance, so you didn’t get “FINED” by the “IRS” at the end of the year! Then Covered CA. tells you that you need to talk to (let’s say Molina), about your “BILL” that you NEVER got in the mail but they still bill you for past months due that you never knew about, and had a family member on it that was “NEVER” put on and it was the wrong name as was the miss-spelling of your own name for the past 1-1/2yrs.? All that I’ve herd over this very long time is Cov.Ca stating “I” have to talk to the ins. co., only to be told “I” have to talk to Cov.Ca.?? I’ve had a number of 3-way conversatios between the three of us, saying my case was being “Escolated”,which they appear not to know what that means! There’s lot’s more, but I still have a life & things to get done. I, wish for all affected by this “forced” health care ins. at a “Too high to pay”, and co-pays as well would find a law group that has what it takes to take on these crooks! Thank you for reading this, I hope( and pray) for a positive response.

Leave a Reply

Please log in using one of these methods to post your comment:

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s