Petition to Shelley Rouillard, Director of the California Department of Managed Health Care:

In October 2014 you issued a ruling exempting Blue Shield from Article 11 of the Knox-Keene Act, which requires that the proceeds from the sale of a nonprofit health plan be turned over to the public and used to meet community healthcare needs. Given Blue Shield’s market value, the public stands to lose over $10 billion as a result of your decision.

We are mystified as to how you could have determined that a core state law intended to protect the public’s ownership of nonprofit health plan assets does not apply to Blue Shield. Blue Shield is chartered as a nonprofit “social welfare” organization, has benefited from a tax exemption for over 70 years, and advertises itself as working for community benefit. Given these facts and your refusal to explain your decision, it is hard not to conclude that you sided with Blue Shield based on political considerations.  

The public has a right to know why you ruled as you did. Respectfully, we ask that you:  

  1. Provide a detailed explanation for your ruling; and
  2. Publicly release all records relating to the determination, including all communications between Blue Shield and you or your staff.

Add your name below to demand an explanation for this massive giveaway of public assets: 

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For more on the DMHC's ruling on Blue Shield see my recent letter to the agency about it.