Cal. Code Regs. Tit. 22, § 53600 - Prohibitions Against Contracting

(a) A plan contract shall not be approved or renewed by the Department if any state officer or state employee or his spouse or his minor children has a substantial financial interest in (1), (2) or (3). For the purposes of this subsection, state employee includes any Department employee in an analyst, auditor or medical personnel classification who has direct responsibility for the negotiation, development or management of a prepaid health plan contract.

(1) The contract or the contracting organization.

(2) Any contract with the contracting organization.

(3) Procurement of a contract for the contracting organization.

(b) A prepaid health plan contract shall not be approved or renewed if a state officer or state employee provides legal or management services to the contracting organization. A state officer or state employee shall not share in the income or any remuneration derived from the provision of legal or management services to a contracting organization.

(c) A prepaid health plan contract shall not be approved or renewed if any state officer or state employee receives anything of value for the purpose of influencing or attempting to influence the negotiations for approval or renewal of the contract.

(d) A plan shall not contract with any subcontractor if any of the following persons connected with the plan have a substantial financial interest in the subcontractor:

(1) Any person also having a substantial financial interest in the plan.

(2) Any director, officer, partner, trustee or employee of the plan.

(3) Any member of the immediate family of any person designated in (1) or (2).

(e) The prohibition in subsection (d) shall not apply to the plan's subsidiary corporation, its parent corporation, another subsidiary of its parent corporation or with an affiliate of the plan if combined or consolidated financial statements including these entities are prepared at the time of the annual audit required in Section 53340 and at the time of filing quarterly reports required by Section 53324.

(f) A prepaid health plan contract shall not be approved, renewed or continued by the Department if a state officer or state employee is employed in a management or consultant position by the contractor or subcontractor within one year after the state officer or state employee terminated state employment.

(1) For purposes of this subsection, state employee means any appointive or civil service employee of the Department or the Health and Welfare Agency at the unit chief level or higher who, within two years prior to leaving state employment, was employed in the Alternative Health Systems Program.

(2) Employees of the Department who are assigned as auditors or analysts which are not directly responsible for the development, negotiations, contract management or direct supervision of prepaid health plans shall not be subject to the provisions of this section.

(3) Employees of the Department who are assigned as contract managers shall not be subject to the provisions of this subsection unless they are employed by a prepaid health plan or a contractor of the prepaid health plan for which, within two years prior to leaving state employment, they were responsible for development, negotiations, contract management or direct supervision of that prepaid health plan contract.

(4) This subsection shall not apply to any employee, appointee or person on contract with the Department who is employed, appointed or contracted with by the Department to fulfill:

(A) The purposes of a federal grant provided that such person does not supervise, develop, manage or negotiate a prepaid health plan contract.

(B) A specific function for the Department, on a temporary basis not to exceed 120 days, which does not include supervising, developing, managing or negotiating a prepaid health plan contract.

Notes

Cal. Code Regs. Tit. 22, § 53600

1. Amendment filed 7-5-78; effective thirtieth day thereafter (Register 78, No. 27).