Note: The stipulated court order resulting from Blue Shield’s lawsuit over my whistleblowing prohibits me from mentioning certain public information about Blue Shield. As a result, I have had to redact some material from this post.

As reported in the Los Angeles Times, the Department of Managed Health Care made clear at a public hearing yesterday that it would carefully scrutinize Blue Shield’s proposed $1.2 billion acquisition of Care1st Health Plan. Most importantly, DMHC Director Shelley Rouillard said the review would include a detailed examination of Blue Shield’s "charitable trust" obligation, or duty to work for public benefit.

Blue Shield insists it has no such obligation. At the hearing, Judy Silas of Consumers Union, citing Blue Shield’s history and the evolution of California law on nonprofits, provided regulators a compelling legal analysis demonstrating otherwise.

In my comments, I urged the DMHC to get to the bottom of inconsistencies between what Blue Shield told the DMHC and ********

I also asked that the DMHC examine whether Blue Shield has failed to fulfill its nonprofit duties before making a decision on the acquisition.