Auditor Questions No-Bid Contracts At Covered California

SACRAMENTO (CBS / AP) -- The state auditor says Covered California issued no-bid contracts when it could have solicited competitive bids.

In a report issued Tuesday, State Auditor Elaine Howle finds the agency issued 64 no-bid contracts worth nearly $200 million over three years.

She recommends that California's health insurance exchange adopt stricter contracting procedures, which the agency said it did last month.

Covered California previously allowed no-bid contracts when it was short on time or when only one company could perform the desired work.

Auditors reviewed 40 no-bid contracts and questioned the need for three. The auditors found nine other contracts for which Covered California did not supply sufficient justification for avoiding competitive bids.

Covered California says it needed no-bid contracts to rapidly prepare for enrollment under the federal health overhaul.