# Health Net

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American health care insurance provider

Health Net, LLC Trade name Health Net[1] Type Subsidiary Industry Managed health care Founded 1979; 47 years ago (1979) Headquarters United States Key people J. Brian Ternan (CEO) Products Health insurance Number of employees 3,000 Parent Centene

**Health Net, LLC**[1] a subsidiary of [Centene](/source/Centene), is an American health care insurance provider. Health Net and its subsidiaries provide health plans for individuals, families, businesses and people with [Medicare](/source/Medicare_(United_States)) and [Medicaid](/source/Medicaid), as well as commercial, small business, and affordable care insurance**.[2]**[3]

In 2016, Centene acquired Health Net for $6.8 billion.[4][5]

## History

Health Net was established as the nonprofit Health Net of California in 1977 by [Blue Cross](/source/Blue_Cross_Blue_Shield_Association).[6] In 1992, a California order permitted the company to convert from a nonprofit to a for-profit company.[7] Under the terms of the [California Department of Corporations](/source/California_Department_of_Corporations)' conversion order, the California Wellness Foundation, the successor charity to its nonprofit status, received $300 million plus 80 percent of the equity of Health Net's parent holding company.[7]

In August 1993, Health Net merged with Qualmed to form Health Systems International.[8][9] In April 1997, Health Systems International merged with Foundation Health Corporation to form Foundation Health Systems.[10] Also in 1997, Foundation Health Systems acquired PACC Health Plans and Physicians Health Services.[10][11]

In November 2000, Foundation Health Systems changed its name to Health Net, Inc. when the company started trading on the New York Stock Exchange under the symbol HNT.[12]

In July 2009, [UnitedHealth Group](/source/UnitedHealth_Group) bought Health Net's northeastern licensed subsidiaries for $510 million, and its Medicare and Medicaid businesses for $60 million.[13] In November 2009, [Connecticut](/source/Connecticut)'s attorney general office investigated a lost, unencrypted hard drive with customer data.[14] Health Net offered two years of free credit protection from a company called Debix to affected customers.[14]

In November 2010, the [Centers for Medicare and Medicaid Services (CMS)](/source/Centers_for_Medicare_and_Medicaid_Services_(CMS)) suspended Health Net for marketing and enrolling new members for compliance issues.[15] The sanctions were lifted in August 2011.[15] In January 2012, the company agreed to sell its Medicare Prescription Drug Plan (PDP) business to [CVS Caremark Corp.](/source/CVS_Health) (CVS) for approximately $160 million in cash.[16][17] Health Net continued to providing prescription drug plans as part of its Medicare Advantage plans.[18]

### Mergers and Acquisitions

On July 2, 2015, [Centene Corporation](/source/Centene_Corporation) announced it would acquire Health Net for $6.8 billion.[4] The acquisition was completed in March 2016 and combined headquarters were established in St. Louis, Missouri.[4][5] The acquisition resulted in Health Net Federal Services (HNFS) becoming a separate subsidiary of Centene.[19][20]

In 2018, Health Net in Arizona was merged into other Centene holdings to form Arizona Complete Health, and Martha Smith was named as its Plan President and CEO.[21][22] Separately, in September 2019, Brian Ternan was appointed CEO of Health Net in California, leading operations in that state.[23]

## Legal cases

In 2007, a California patient sued Health Net claiming that the company wrongfully terminated her care during chemotherapy treatments.[24] During the case, a company employee performance review revealed that a manager had tied bonuses for an analyst in charge of [rescission](/source/Rescission_(contract_law)) reviews to the rate of enrollees whose coverage was discontinued.[24] Health Net claimed that the patient withheld health information, including a heart problem, that would have disqualified her from coverage.[24] She replied that the insurance broker had filled out the form for her.[24] In February 2008, the court ruled in Bates' favor and ordered Health Net to over $9 million in damages.[25]

In 2008, Health Net agreed to pay $215M to settle allegations that it had unfairly reimbursed out-of-network providers between 1995 and 2007.[26]

In September 2012, the Los Angeles County Medical Association and two patients sued Health Net for denying medically necessary treatment, including cancer care.[27] The lawsuit alleged that Health Net denied claims based on its own definition of "medical necessity" rather than standards set forth by California law.[27] A judge ruled in Health Net's favor in July 2013.[28]

In 2016, Health Net Federal Services became a wholly owned subsidiary of Centene, ending its time as a publicly traded company.[29] In 2021, Health Net's former subsidiary, Health Net Federal Services, agreed to pay $97M to settle allegations that it had duplicated or inflated claims submitted to the Department of Veterans Affairs between 2013 and 2019.[30]

## See also

- [Los Angeles portal](https://en.wikipedia.org/wiki/Portal:Los_Angeles)
- [Companies portal](https://en.wikipedia.org/wiki/Portal:Companies)

- [Top 100 US Federal Contractors](/source/Top_100_US_Federal_Contractors)

## References

1. ^ [***a***](#cite_ref-justia_1-0) [***b***](#cite_ref-justia_1-1) ["HEALTH NET - Trademark Details"](https://trademarks.justia.com/760/44/health-76044966.html). *[Justia](/source/Justia) Trademarks*. Retrieved February 17, 2026.

1. **[^](#cite_ref-2)** Beck, Melinda (2010-03-09). ["When Anger Is An Illness"](https://www.wsj.com/articles/SB10001424052748703954904575109671604585094). *[The Wall Street Journal](/source/The_Wall_Street_Journal)*. [ISSN](/source/ISSN_(identifier)) [0099-9660](https://search.worldcat.org/issn/0099-9660). Retrieved 2021-09-20.

1. **[^](#cite_ref-3)** Japsen, Bruce. ["Centene's $6.3B Health Net Deal Shows Medicaid Plans Quick To Diversify"](https://www.forbes.com/sites/brucejapsen/2015/07/02/centenes-6-3b-health-net-deal-shows-medicaid-plans-quick-to-diversify/). *Forbes*. Retrieved 2022-07-13.

1. ^ [***a***](#cite_ref-:2_4-0) [***b***](#cite_ref-:2_4-1) [***c***](#cite_ref-:2_4-2) Bray, Chad (July 2, 2015). ["Centene to Acquire Its Managed Care Rival Health Net for $6.8 Billion"](https://www.nytimes.com/2015/07/03/business/dealbook/centene-corporation-health-net-deal.html). *The New York Times*. Retrieved November 18, 2020.

1. ^ [***a***](#cite_ref-:4_5-0) [***b***](#cite_ref-:4_5-1) Liss, Samantha (March 24, 2016). ["Centene completes Health Net deal"](https://www.stltoday.com/business/local/centene-completes-health-net-deal/article_d3d0a721-c5c6-541a-b172-509e7264407d.html). *St. Louis Post-Dispatch*. Retrieved 2020-11-18.

1. **[^](#cite_ref-6)** Stassel, Stephanie (28 September 1991). ["Paul Wilson; Sunkist Executive, Founding Chairman of Health Net"](https://www.latimes.com/archives/la-xpm-1991-09-28-mn-2653-story.html). *[Los Angeles Times](/source/Los_Angeles_Times)*. Retrieved 2020-11-18.

1. ^ [***a***](#cite_ref-:0_7-0) [***b***](#cite_ref-:0_7-1) Peltz, James F. (February 8, 1992). ["Health Net Wins For-Profit Status : * Medicine: The state lets the Woodland Hills-based HMO convert from a nonprofit organization after it agrees to cede majority ownership to a foundation"](https://www.latimes.com/archives/la-xpm-1992-02-08-fi-1192-story.html). *Los Angeles Times*. Retrieved December 10, 2017.

1. **[^](#cite_ref-8)** Lee, Don (31 August 1993). ["Rivals Health Net, QualMed Agree to Merge : Health care: The strategic alliance would give the two HMOs a combined 1.2 million customers in six Western states"](https://www.latimes.com/archives/la-xpm-1993-08-31-fi-29825-story.html). *Los Angeles Times*. Retrieved 2020-11-18.

1. **[^](#cite_ref-9)** Freudenheim, Milt (1995-03-28). ["Company News; 2 California Health Care Providers Agree to a $1.8 Billion Merger (Published 1995)"](https://www.nytimes.com/1995/03/28/business/company-news-2-california-health-care-providers-agree-to-a-1.8-billion-merger.html). *[The New York Times](/source/The_New_York_Times)*. [ISSN](/source/ISSN_(identifier)) [0362-4331](https://search.worldcat.org/issn/0362-4331). Retrieved 2020-11-18.

1. ^ [***a***](#cite_ref-:1_10-0) [***b***](#cite_ref-:1_10-1) ["Foundation Health Will Buy Physicians Health, as Expected"](https://www.wsj.com/articles/SB863098532884799000). *Wall Street Journal*. 1997-05-09. [ISSN](/source/ISSN_(identifier)) [0099-9660](https://search.worldcat.org/issn/0099-9660). Retrieved 2020-11-18.

1. **[^](#cite_ref-11)** Brock, Kathy (13 April 1997). ["Health care giant swallows PACC"](https://www.bizjournals.com/portland/stories/1997/04/14/story1.html). *[Portland Business Journal](/source/Portland_Business_Journal)*.

1. **[^](#cite_ref-Los_Angeles_Times_12-0)** ["Foundation Health Systems Now Known as Health Net"](https://www.latimes.com/archives/la-xpm-2000-nov-21-me-55175-story.html). *Los Angeles Times*. 21 November 2000. Retrieved 10 December 2017.

1. **[^](#cite_ref-13)** Bordonaro, Greg (4 December 2009). ["State approves UnitedHealthcare, Health Net Merger"](https://www.hartfordbusiness.com/article/state-approves-unitedhealthcare-health-net-merger). *Hartford Business Journal*. Retrieved 2013-02-01.{{[cite web](https://en.wikipedia.org/wiki/Template:Cite_web)}}: CS1 maint: deprecated archival service ([link](https://en.wikipedia.org/wiki/Category:CS1_maint:_deprecated_archival_service))

1. ^ [***a***](#cite_ref-:6_14-0) [***b***](#cite_ref-:6_14-1) Mearian, Lucas (2009-11-19). ["Health Net says 1.5M medical records lost in data breach"](https://www.computerworld.com/article/2521838/health-net-says-1-5m-medical-records-lost-in-data-breach.html). *[Computerworld](/source/Computerworld)*. Retrieved 2020-11-18.

1. ^ [***a***](#cite_ref-:7_15-0) [***b***](#cite_ref-:7_15-1) ["Update 1-Health Net says CMS lifts sanctions on Medicare programs"](https://www.reuters.com/article/healthnet-idUSL3E7J223Y20110802). *Reuters*. 2011-08-02. Retrieved 2021-09-20.

1. **[^](#cite_ref-16)** ["Health Net (HNT) Announces Plans to sell Stand-Alone Prescription Plan Business to CVS Caremark (CVS) for ~$160M"](https://web.archive.org/web/20190723032337/https://www.streetinsider.com/Mergers%2Band%2BAcquisitions/Health%2BNet%2B(HNT)%2BAnnounces%2BPlans%2Bto%2BSell%2BMedicare%2BStand%25E2%2580%2590Alone%2BPrescription%2BDrug%2BPlan%2BBusiness%2Bto%2BCVS%2BCaremark%2B(CVS)%2Bfor%2B~$160M/7066970.html). 9 January 2012. Archived from [the original](http://www.streetinsider.com/Mergers+and+Acquisitions/Health+Net+%28HNT%29+Announces+Plans+to+Sell+Medicare+Stand%E2%80%90Alone+Prescription+Drug+Plan+Business+to+CVS+Caremark+%28CVS%29+for+~%24160M/7066970.html) on 2019-07-23. Retrieved 2020-01-11.

1. **[^](#cite_ref-17)** Crowe, Deborah (9 January 2012). ["Health Net Sells Medicare Drug Plan for $160 Million"](http://labusinessjournal.www.clients.ellingtoncms.com/news/2012/jan/09/health-net-sells-medicare-drug-plan-160-million/). *Los Angeles Business Journal*. Retrieved 2020-11-18.

1. **[^](#cite_ref-18)** ["Health Net sells Medicare drug plan business to CVS Caremark for $160M"](https://www.healthcarefinancenews.com/news/health-net-sells-medicare-drug-plan-business-cvs-caremark-160m). *Healthcare Finance News*. 10 January 2012. Retrieved 2020-11-18.

1. **[^](#cite_ref-19)** Robertson, Kathy (10 November 2016). ["Exclusive: Health Net gets new $17.7 billion military health care contract"](https://www.bizjournals.com/sacramento/news/2016/11/10/exclusivehealth-net-gets-new-17-7-billion-military.html). *www.bizjournals.com*. Retrieved 2021-09-20.

1. **[^](#cite_ref-20)** Sauter, Michael; Stebbins, Samuel. ["These 30 companies, including Boeing, get the most money from the federal government"](https://www.usatoday.com/story/money/business/2019/03/27/lockheed-martin-boeing-get-most-money-federal-government/39232293/). *[USA Today](/source/USA_Today)*. Retrieved 2021-09-20.

1. **[^](#cite_ref-21)** ["Health Net name disappearing in Arizona"](https://www.bizjournals.com/phoenix/news/2018/10/04/health-net-name-disappearing-in-arizona.html). *Phoenix Business Journal*. Retrieved 2019-06-21.

1. **[^](#cite_ref-22)** ["Investments in telehealth solutions in Arizona address the need for members to continue essential care"](https://www.bizjournals.com/phoenix/news/2021/03/11/investments-in-telehealth-solutions-in-arizona-add.html). *www.bizjournals.com*. Retrieved 2022-07-13.

1. **[^](#cite_ref-23)** Russell, John (30 January 2020). ["Anthem sues senior executive who took job with competitor, demands return of $4M"](https://www.ibj.com/articles/anthem-sues-executive-who-took-job-with-a-competitor-demanding-he-return-4m). *Indianapolis Business Journal*. Retrieved 2020-11-18.

1. ^ [***a***](#cite_ref-:5_24-0) [***b***](#cite_ref-:5_24-1) [***c***](#cite_ref-:5_24-2) [***d***](#cite_ref-:5_24-3) Girion, Lisa (November 9, 2007). ["Health Insurer Tied Bonuses to Dropping Sick Policyholders"](https://www.latimes.com/business/la-fi-insure9nov09-story.html). *Los Angeles Times*. Retrieved September 13, 2013.

1. **[^](#cite_ref-25)** ["Canceled Cancer Patient Awarded $9 Million"](https://www.cbsnews.com/news/canceled-cancer-patient-awarded-9-million/). *www.cbsnews.com*. February 22, 2008. Retrieved 2021-09-20.

1. **[^](#cite_ref-26)** ["Health Net inks $215M settlement on payment allegations"](https://www.fiercehealthcare.com/healthcare/health-net-inks-215m-settlement-payment-allegations). *Fierce Healthcare*. July 25, 2008. Retrieved February 23, 2022.

1. ^ [***a***](#cite_ref-:8_27-0) [***b***](#cite_ref-:8_27-1) ["Health Net faces suit over refusals to cover treatments"](https://www.latimes.com/business/la-xpm-2012-sep-13-la-fi-medical-denials-case-20120913-story.html). *Los Angeles Times*. September 13, 2012. Retrieved September 20, 2021.

1. **[^](#cite_ref-28)** ["Health Net's 'Medical Necessity' Definition OK'd By Judge - Law360"](https://www.law360.com/articles/456087/health-net-s-medical-necessity-definition-ok-d-by-judge). *www.law360.com*. Retrieved September 20, 2021.

1. **[^](#cite_ref-29)** ["CA insurer Health Net pays $97M to settle VA billing probe"](https://account.sacbee.com/paywall/subscriber-only?resume=250474021&intcid=ab_archive). *Sacramento Bee*.[*[dead link](https://en.wikipedia.org/wiki/Wikipedia:Link_rot)*]

1. **[^](#cite_ref-30)** ["Health Net Federal Services Pays over $97M for Overstated Billings to the VA"](https://www.justice.gov/usao-edca/pr/health-net-federal-services-pays-over-97m-overstated-billings-va). *www.justice.gov*. April 6, 2021. Retrieved February 23, 2022.

## External links

- [Health Net Federal Services website Rancho Cordova's Health Net division may see layoffs](https://web.archive.org/web/20070201163953/https://www.hnfs.net/common/home/)

- [Health insurer tied bonuses to dropping sick policyholders](https://web.archive.org/web/20080310203016/http://www.sacbee.com/103/story/766746.html)

- [February 23, 2008: Health Insurer Fined $9M for Dropping Calif. Breast Cancer Patient in Middle of Her Chemo](https://web.archive.org/web/20110522090312/http://www.latimes.com/business/la-fi-insure9nov09,1,5878955,print.story?ctrack=5&cset=true)

Authority control databases ISNI

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Adapted from the Wikipedia article [Health Net](https://en.wikipedia.org/wiki/Health_Net) by Wikipedia contributors ([contributor history](https://en.wikipedia.org/wiki/Health_Net?action=history)). Available under [Creative Commons Attribution-ShareAlike 4.0 International](https://creativecommons.org/licenses/by-sa/4.0/). Changes may have been made.