Blue Shield of California accused of backing out of $140M pledge

California regulators and consumer groups have accused Blue Shield of California of going back on its word to give $140 million to charitable organizations, according to the Los Angeles Times.

Regulators claim that in addition to its regular giving, the insurer pledged last month to give $14 million annually for 10 years to the Blue Shield of California Foundation or another charity. They say it was part of the deal involving Blue Shield's $1.2 billion acquisition of Care1st Health Plan.

However, Blue Shield disagrees. In a recent interview with the Los Angeles Times, Blue Shield of California CEO Paul Markovich said the pledge of $140 million pledge wasn't additional money.

Many have articulated their frustration with Blue Shield, including those involved with the Care1st acquisition.

Shelley Rouillard, director of the Department of Managed Health Care, said her "expectation in approving the transaction was that Blue Shield would increase its overall charitable contributions to improve healthcare delivery in California. This intent was expressed during the negotiations process."

Nevertheless, she didn't say she would require Blue Shield to increase its giving, claiming "reasonable people may disagree about the meaning of the language" in the agreement.

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