Vision Service Plan puts 150 jobs on hold amid insurance dispute

09/29/2012 12:00 AM

09/28/2012 9:41 PM

Vision Service Plan, in a dispute with the state of California over a new insurance program, said Friday it's putting 150 new jobs on hold until the controversy is resolved.

The Rancho Cordova eye-care insurer is going ahead with filling 100 temporary jobs. But the hiring of 150 permanent workers has been shelved.

The 150 jobs aren't functions related to the state's new program, which is designed to provide affordable coverage to uninsured Californians, said VSP spokeswoman Jill Novelo.

Asked if the company is suspending the hiring as a protest, she said VSP will release more information next week. "I can't speak to that at this time," she said.

VSP, which employs 2,100 Sacramentans, has already hinted that it might leave the state because of the dispute. State officials said last week they hope to resolve the matter in response to VSP's protests.

The dispute surrounds the California Health Benefit Exchange, the online insurance market that is part of President Barack Obama's overhaul of health care. Some 2 million uninsured Californians are expected to buy coverage through the exchange when it opens in 2014.

The exchange's governing board ruled last month that stand-alone eye insurer VSP would be allowed to sell coverage to small businesses but not individuals. That excludes VSP from the biggest piece of the market.

The distinction has to do with federal tax subsidies. Individual purchasers will receive them; businesses won't. Letting individuals buy eye-care coverage through a separate company like VSP would require splitting the subsidy between the eye-care insurer and the main insurance carrier.

The Health Benefit Exchange decided it was too complicated to do that, at least in the first year of operation. Critics, however, noted that stand-alone dental insurers are being allowed to sell to individual purchasers.


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