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California panel OKs exchange contract information bill

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SACRAMENTO, Calif. (AP) — A state legislative committee on Wednesday approved a bill that would require California’s health insurance exchange to make more contract information publicly available, even as advocates for open government urged lawmakers to go further.

The Senate Health Committee voted 9-0 to pass the legislation by Republican Sen. Bill Emmerson and Democratic Sen. Mark DeSaulnier. They introduced the bill, SB332, after a story by The Associated Press revealed the unique degree of privacy granted to Covered California, as the exchange is called.

When lawmakers created California’s health insurance exchange in 2010 under the federal Patient Protection and Affordable Care Act (PPACA), they gave it the authority to conceal contracts for a year and the amounts paid indefinitely.

Under the bill, only contracts with health insurance plans could be withheld for a year. Payment details in those contracts would be private for four years.

The updated disclosure rules were modeled on those used by the state’s Healthy Families program.

Government transparency advocates say contract details should be disclosed once the agreements are final, noting the tens of millions of dollars that will flow to private companies.

“There’s a need for confidentially up to the point where the agreement is entered into,” Peter Scheer, executive director of the San Rafael-based First Amendment Coalition, said in an interview Wednesday. “Then all the material information needs to be made public unless there’s some really compelling reason not to.”

Under current rules, exchange officials can keep secret board meeting minutes, employee training materials and records that reveal recommendations, research or strategy. SB332 also seeks to reverse those restrictions.

California Common Cause and Health Access California are backing the changes, which representatives say would help ensure that Californians know how the exchange is being managed.

An AP survey of the 16 other states that have opted for state-run marketplaces showed that the California agency was given powers that are the most restrictive in what information is required to be made public.

Five Republican U.S. senators have asked the U.S. Department of Health and Human Services to investigate whether California is inappropriately concealing details of how it is spending federal dollars for building and running the insurance exchange.

Exchange officials “have so far complied with the public’s request for information,” Emmerson said. “Regardless, this bill is necessary to guarantee transparency in the upcoming years.”

Covered California plans to spend nearly $458 million on outside vendors by the end of 2014, covering lawyers, consultants, public relations advisers and other functions. Exchange spokesman Dana Howard has said the agency complies with state law.

In response to a previous AP public records request, the agency released information on a dozen competitively bid contracts issued since early 2011. They included $14 million for a contract with Ogilvy Public Relations for marketing and $327 million for a five-year deal with consulting giant Accenture to develop a web portal and enrollment system.

SB332 now goes to the Senate Appropriations Committee.

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