California Republicans seeking to capitalize on health law vulnerabilities

ccadelago@sacbee.comFebruary 13, 2014 

YOUTUBE SCREENSHOT

The Barack Obama impersonator is well into promoting the president’s health insurance overhaul when he concedes a deficiency of the law: “It’s not going to stop you from doing stupid things.”

“But if those stupid things were to break your legs, it is going to be right there,” the impressionist says in the introduction to “Tell a Friend, Get Covered,” a promotional Web video produced on behalf of Covered California for $1.37 million.

The six-hour infomercial, aimed at a young audience and funded by federal taxpayers, has become the latest flashpoint as Republican officeholders increasingly raise questions about the rollout of the new health law four months ahead of the primary election.

“I was really angered that our money was being spent in that fashion,” said Sen. Ted Gaines, R-Roseville, who is running for state insurance commissioner.

“A lot of people don’t make that kind of money in a lifetime. And yet it’s burned in six hours on this webcast. It just seemed frivolous to me,” said Gaines, who sent a letter to the state exchange questioning its marketing efforts and the methods officials use to determine the effectiveness of an ad.

In recent weeks, Republican officeholders challenged the state exchange over its spending, calling for a top-to-bottom audit of its finances. Separately, Assembly Republicans want a legislative hearing to probe why the agency allowed felons, including people convicted of forgery and welfare fraud, to help enroll customers in health insurance plans. And Gaines panned the infomercial, which featured a cameo by 65-year-old health and fitness guru Richard Simmons, dancing with a rose in his teeth.

“I am not sure to what degree Richard Simmons connects with millennials,” Gaines said.

Andrew Acosta, a Democratic political consultant on state and federal races, said there is no question the upcoming contests are playing into the debate.

Republicans are “obviously trying to paint (Democrats) with the same Obamacare brush,” Acosta said.

Still, he conceded the attacks could stick to some state candidates depending on the circumstances of their campaign. “I think it would be hard to say that the implementation of this was done in a way that anybody would say ‘Good job, team,’ ” he said.

Polls show that support for Obama and his chief policy achievement isn’t strong even in Democrat-dominated California, where enrollment is exceeding projections set for the first six months.

A statewide survey taken in the last three weeks found Obama’s approval rating had dropped to a record-low 46 percent among likely voters. And despite the fact that California has struggled much less than the federal government in implementing the law, fewer than half of adults told pollsters from the Public Policy Institute of California that the online exchange is working well.

Republican lawmakers are pressing questions over the exchange’s hiring record after Covered California officials released documents showing they allowed more than two dozen people with criminal backgrounds to work as enrollment counselors. Assembly Republican leader Connie Conway, R-Tulare, and Assemblyman Brian Nestande, R-Palm Desert, wrote in a joint letter that they understand people who paid their debts to society deserve a second chance.

“But obviously the odds go up of this information getting in the wrong hands if you have people that have been convicted of crimes in the past, particularly financial crimes or forgery,” said Nestande, who is running against Rep. Raul Ruiz, D-Palm Desert.

“It does not make sense to allow those people to have access to that kind of information.”

A total of 31 people with criminal convictions were cleared to work with the exchange. The total number of certified counselors exceeds 4,200. None of those convicted of crimes are state employees, and many work for nonprofit partners.

Anne Gonzales, a spokeswoman for Covered California, said the exchange’s hiring process is consistent with other state agencies’ practices, with the criminal background-check portion based on the employer best practices in the Equal Employment Opportunity Commission’s enforcement guidance. A “zero-tolerance approach” for hiring people with convictions would amount to discrimination under the Civil Rights Act, Gonzales said.

The hiring standards are “very similar” to the policies in place for the federal Transportation Security Administration, she said.

Records provided by the state exchange show it qualified for employment people convicted of forgery in 1988, welfare fraud in 1999 and petty theft in 2006. The age and nature of the offense was taken into account, along with the relation of the offense to their counselor duties and the performance of similar duties in other jobs, Gonzales said.

“Some of these look bad on paper, but once you find out the details we have deemed them not to be any more dangerous than anyone else who might have access to this type of information,” she said.

Exchange officials would not address whether they believe the recent spate of negative attention on the law is politically motivated. Partisan wrangling over the health care law nationally has been clear since its passage.

In California, legislative Republicans had for the most part set aside their differences with the federal act. GOP lawmakers hosted town hall meetings in their districts to help constituents navigate the enrollment process.

As the election approaches, however, they say the issue will help motivate their core voters to go to the polls. Talking about the health care law likely won’t cause a Democratic voter to support a Republican, “it simply causes a Democrat to stay home,” Republican strategist Tim Clark said.

“Our Republicans that have been beleaguered here have a new reason to exist, and that is they hate Obamacare,” Clark said. “They are coming out to vote in huge droves if we can beat that drum.”

In an interview, Gaines rebuffed the idea that his inquiries into the state exchange’s spending are tied to any election. In his letter to Covered California Executive Director Peter V. Lee, Gaines dismissed the marathon webcast involving Simmons as a wasteful and insulting effort.

In calling for an audit of the exchange, Gaines also sought to draw attention to the fact that estimated expenses exceed revenues by $78.4 million in 2015-16.

“How is the Affordable Care Act via Covered California going to sustain itself over the long term without going back to policyholders and increasing fees, or asking for more tax dollars to sustain it?” Gaines asked. “I have never been convinced that we are truly going to save money.”

Covered California plans to cover the $78.4 million gap by carrying over $184.5 million in year-end reserves, Gonzales said.

She defended spending $1.37 million of the exchange’s roughly $80 million marketing budget on the infomercial. Much of the money went to production costs, including the studio, staff, equipment and sets. It also went to developing the concept, writing, editing, and four videos to use in the live event and social media.

Among the goals was penetrating the elusive 18-to-35 demographic known as millennials or “young invincibles,” who constitute 36 percent of the target enrollment.

“We envision this event as a start toward cracking this market,” Gonzales said.

Exchange officials said four promotional videos released before the live event generated more than 2.7 million views, and the live webcast garnered 17,800 visits to tellafriendgetcovered.com. About 8,500 visitors to that website have since been referred to the CoveredCA.com enrollment portal.

None of the celebrity guests were paid for appearing in the promotional event, Gonzales said. As for Simmons, she suspected he was chosen for his “vivaciousness” and “spontaneous character.”

“He is a well-known health advocate, and he does have a large social media following,” she said, adding, “It may not be everybody’s cup of tea.”

Editor's Note: This story has been corrected from online and print versions to say that none of the celebrities in the infomercial were paid for their work.

Call Christopher Cadelago, Bee Capitol Bureau, (916) 326-5538. Follow him on Twitter @ccadelago.

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