Health Net Settles With California Hospitals in Policy Rescission Suit
Health Net has agreed to pay about $1.95 million to California hospitals to settle claims related to the rescission of patients' individual insurance policies, the San Fernando Valley Business Journal reports.
The California Hospital Association organized the class-action lawsuit, which relates to Health Net's decision to revoke policies between February 2004 and October 2007.
Under the settlement, Health Net will reimburse about 200 hospitals for services provided to patients whose policies were rescinded after they incurred medical bills (San Fernando Valley Business Journal, 5/27).
Health Net also will provide hospitals with a list of the rescinded patients to clear individuals of liability for medical bills that went unpaid after the rescissions.
Health Net admitted no wrongdoing in the settlement, according to Modern Healthcare (Vesely, Modern Healthcare, 5/26).
However, the company said it has changed its practices and will employ an independent review process in an effort to reduce rescissions.
Last year, Health Net reached a separate agreement with the California Department of Insurance to offer coverage to 926 rescinded members and pay $25 million in fines.
The hospital association last year also reached an $11.8 million settlement involving patients with rescinded Blue Cross of California policies (Crowe, Los Angeles Business Journal, 5/27).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.