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News Release: 99-17
GRAY DAVIS, Governor
Date: 12/03/99
WILLIAM KENEFICK, Acting Commissioner
Department of Corporations to Halt Operations of Illegal Health Plan in Southern California
Plan members advised to seek alternative health care services and coverage
Sacramento, December 3, 1999 — The Department of Corporations today announced that further health plan operations of National Consumers Benefits Association (NCBA and/or NCBA Healthplus) of Riverside, California are illegal and issued a warning to plan enrollees that the plan is operating unlawfully. The department is advising plan enrollees to immediately make alternative arrangements for health care services and coverage.
The department’s action comes on the heels of a November 2, 1999 order directing Raymond Palombo, Principal Officer, National Consumers Benefits Association (NCBA and/or NCBA Healthplus), to cease operations immediately and barring the firm from soliciting or enrolling new members in the health plans’ programs. The department directed the plan to terminate all health care service plan operations by November 30, 1999, and take immediate action to notify all current members of the order.
Near the end of November, Palombo requested a hearing seeking to delay the Commissioner’s order. Acting Commissioner William Kenefick denied Palombo’s request on the grounds that it would not be in the public interest.
In a final effort this week, Palombo and NCBA filed a civil action against the Department of Corporations in Los Angeles Superior Court seeking a temporary restraining order to allow their plan to continue to operate pending the administrative hearing. The court denied the application on December 1, 1999. Palombo failed to file an appeal within the court allotted deadline and the department’s cease and desist order remains in effect.
NCBA/Healthplus members seeking alternate health coverage may wish to investigate the three health care programs offered by the Managed Risk Medical Insurance Board (MRMIB). The programs include the Access for Infants and Mothers Program (AIM), which provides low cost health insurance coverage to moderate income pregnant women and their infants (application: toll free 1-800-433-2611); the Healthy Families Program (HFP), which provides low cost health, dental and vision coverage to children in low wage families (application: toll free 1-888-747-1222); and the Major Risk Medical Insurance Program (MRMIP), which provides health insurance for Californians that are unable to obtain coverage in the individual health insurance market (application: toll free 1-888-289-6574). These programs are further described on the Internet at the MRMIB website: www.mrmib.ca.gov.
Enrollees seeking additional information on the availability of health care services can call the Department of Insurance’s Hotline toll free at 1-800-927-HELP (4357).
Editor's Note: As of July 1, 2000 the Health Plan Program and the administration of the Knox-Keene Health Care Service Plan Act of 1975, as amended by the 1999 HMO reform legislation, has transferred to the new Department of Managed Health Care (www.dmhc.ca.gov).
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