Managers of the new Covered California exchange system have awarded advertising and public relations contracts.
The California Health Benefit Agency is hiring Weber Shandwick to run its marketing and advertising programs from now through April 2015.
Weber Shandwick will earn about $12 million in fees for overseeing $86 million in ad placement spending, exchange officials said.
In additional to overseeing traditional print, broadcast and billboard advertising, Weber Shandwick will handle social and digital media programs. The company also will develop brochures and other types of collateral materials for consumers.
Ogilvy Public Relations, which has been running marketing and media relations for the exchange for more than a year, will continue to handle media relations and community outreach efforts, exchange officials said.
Ogilvy will be responsible for getting volunteers and businesses to help persuade consumers to sign up to use the exchange system.
About a year ago, when the exchange chose Ogilvy to handle the initial public relations effort, a reporter at the Sacramento Bee suggested that the contract might put Ogilvy in line to win the exchange advertising vendor contract.
Michael R. Blood, a reporter at the Associated Press, mentioned Ogilvy recently in an article in which he observed that California had been more generous with exchange vendor contract confidentiality provisions than other states had been. Lawmakers in the California have been debating a bill that would change exchange-vendor contract confidentiality rules.
Peter Lee, the executive director of Covered California, said in a statement that Weber Shandwick has extensive health care communications experience, including experience with the Massachusetts health insurance exchange program and with the federal Patient Protection and Affordable Care Act (PPACA) exchange program.
Covered California managers believe Weber Shandwick's experience "will create significant results and cost savings opportunities," Lee said.
PPACA calls for the U.S. Department of Health and Human Services (HHS) and state agencies to set up exchanges, or health insurance supermarkets, for individuals and small businesses in all 50 states and the District of Columbia by Oct. 1. Many states are asking HHS to provide exchange services for their residents. California is setting up its own state-based individual exchange and Small Business Health Options Program (SHOP) exchange.
Covered California officials noted in the communications contract announcement that they are using federal grant money, not state general fund money, to pay for the exchange outreach efforts.