Ex-State Commissioner Target of Medi-Cal Probe

The state attorney general’s office is investigating whether a former state commissioner involved in the creation of an ill-fated Medi-Cal experiment, called Expanded Choice, would have profited from its implementation, a spokesman for the office said Tuesday.

The focus of the investigation is Robert (Nick) Starr, who was until recently a member of the California Medical Assistance Commission, according to Dan Beall, the chief supervisor of the attorney general’s Bureau of Medi-Cal Fraud in Los Angeles.

As a commissioner and chairman of an Expanded Choice subcommittee, Starr helped design the experiment that would have required about 250,000 Medi-Cal recipients in the San Fernando Valley and San Diego County to receive all their health care from health maintenance organizations.

Investigators are exploring whether Starr had hidden interests in any health groups that hoped to participate in the pilot project, Beall said. Starr rented a medical building he owns in North Hollywood to the Valley Health Medical Group, which actively sought an Expanded Choice subcontract, according to court records.

Expanded Choice was designed to save the state money by switching Medi-Cal recipients from the care of independent physicians to HMOs. But the proposal met stiff resistance from physicians and advocates of the poor, disabled and elderly--who receive their health care under Medi-Cal--and was killed at least for this year when funds for its start-up costs were not included in the governor’s budget for 1986-1987.

Beall said investigators are trying to determine if “Robert (Nick) Starr and others were involved in any conflict of interest or any violation in the letting of contracts of the Expanded Choice program in the San Fernando Valley.”

Starr, 53, a Ventura businessman who operated medical laboratories for many years, could not be reached for comment.

Investigators declined to say what prompted the investigation. But at least some allegations have surfaced as a result of a broken partnership among physicians in the Valley Health Medical Group, which lead to the filing of a lawsuit and countersuit in Superior Court in Van Nuys.

Dr. Filiberto Zadini, a former member of the health group, has alleged in a countersuit that he invested in the North Hollywood medical practice after he was assured in 1985 that Starr would use his influence to obtain an Expanded Choice contract for the group.