|[December 27, 2012]
Health Net Terminates Agreements with Six Tenet Healthcare Hospitals in Southern California
LOS ANGELES --(Business Wire)--
Net, Inc. (NYSE: HNT) today announced that its subsidiaries
exercised their contractual option to terminate agreements with all six
of Tenet Healthcare's Southern California hospitals.
The terminations were effective midnight on Dec. 21, 2012. The
facilities are: Desert Regional Medical Center, Fountain Valley Hospital
and Medical Center, John F. Kennedy Memorial Hospital, Lakewood Regional
Medical Center, Los Alamitos Medical Center and Placentia Linda Hospital.
"The decision to proceed with the termination process was difficult,"
said Steve Sell, president of Health Net's Western Region Health Plan.
"We had no choice, however, as Tenet Healthcare has refused our requests
to negotiate a new contract that more accurately reflects current
statewide market conditions."
Health Net and Tenet Healthcare were nearing the end of a three-year
contract. Health Net believes Tenet's reimbursement should be in line
with the medical consumer price index, which currently averages more
than 3 percent, and that reimbursement for state- and federally funded
programs like Medi-Cal needs to be consistent with the funding for those
programs. In recent discussions for a new contract, Health Net and Tenet
have been unsuccessful in reaching agreement on reimbursement amounts.
"Our goal is to help preserve affordable benefits for our customers, not
pass along inflated health care costs," said Sell.
Health Net members, employers, brokers, and consultants will receive
further information in the coming weeks. Health Net commercial members
with questions may call our Customer Service Department at
1-800-522-0088. Medicare members with questions may call 1-800-275-4737.
Medi-Cal and Cal-Optima members may contact 800-641-7761. Employers,
brokers, and consultants with questions should contact their Health Net
About Health Net
Health Net, Inc. is a publicly traded
managed care organization that delivers managed health care services
through health plans and government-sponsored managed care plans. Its
mission is to help people be healthy, secure and comfortable. Health
Net, through its subsidiaries, provides and administers health benefits
to approximately 5.4 million individuals acros the country through
group, individual, Medicare (including the Medicare prescription drug
benefit commonly referred to as "Part D"), Medicaid, U.S. Department of
Defense, including TRICARE, and Veterans Affairs programs. Health Net's
behavioral health services subsidiary, Managed Health Network, Inc.,
provides behavioral health, substance abuse and employee assistance
programs to approximately 4.9 million individuals, including Health
Net's own health plan members. Health Net's subsidiaries also offer
managed health care products related to prescription drugs, and offer
managed health care product coordination for multi-region employers and
administrative services for medical groups and self-funded benefits
For more information on Health Net, Inc., please visit Health Net's
website at www.healthnet.com.
Health Net, Inc. and its
representatives may from time to time make written and oral
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act ("PSLRA") of 1995, including statements in this
and other press releases, in presentations, filings with the Securities
and Exchange Commission ("SEC (News - Alert)"), reports to stockholders and in meetings
with investors and analysts. All statements in this press release, other
than statements of historical information provided herein, may be deemed
to be forward-looking statements and as such are intended to be covered
by the safe harbor for "forward-looking statements" provided by PSLRA.
These statements are based on management's analysis, judgment, belief
and expectation only as of the date hereof, and are subject to changes
in circumstances and a number of risks and uncertainties. Without
limiting the foregoing, statements including the words "believes,"
"anticipates," "plans," "expects," "may," "should," "could," "estimate,"
"intend," "feels," "will," "projects" and other similar expressions are
intended to identify forward-looking statements. Actual results could
differ materially from those expressed in, or implied or projected by
the forward-looking information and statements due to, among other
things, health care reform and other increased government participation
in and regulation of health benefits and managed care operations,
including the ultimate impact of the Affordable Care Act, which could
materially adversely affect Health Net's financial condition, results of
operations and cash flows through, among other things, reduced revenues,
new taxes, expanded liability, and increased costs (including medical,
administrative, technology or other costs), or require changes to the
ways in which Health Net does business; rising health care costs;
continued slow economic growth or a further decline in the economy;
negative prior period claims reserve developments; trends in medical
care ratios; membership declines; unexpected utilization patterns or
unexpectedly severe or widespread illnesses; rate cuts and other risks
and uncertainties affecting Health Net's Medicare or Medicaid
businesses; Health Net's ability to successfully participate in the
dual-eligibles pilot programs; litigation costs; regulatory issues with
federal and state agencies including, but not limited to, the California
Department of Managed Health Care, the Centers for Medicare & Medicaid
Services, the Office of Civil Rights of the U.S. Department of Health
and Human Services and state departments of insurance; operational
issues; failure to effectively oversee our third-party vendors;
noncompliance by Health Net or Health Net's business associates with any
privacy laws or any security breach involving the misappropriation, loss
or other unauthorized use or disclosure of confidential information;
liabilities incurred in connection with Health Net's divested
operations; impairment of Health Net's goodwill or other intangible
assets; investment portfolio impairment charges; volatility in the
financial markets; and general business and market conditions.
Additional factors that could cause actual results to differ materially
from those reflected in the forward-looking statements include, but are
not limited to, the risks discussed in the "Risk Factors" section
included within Health Net's most recent Annual Report on Form 10-K and
subsequent Quarterly Reports on Form 10-Q filed with the SEC, and the
other risks discussed in Health Net's filings with the SEC. Readers are
cautioned not to place undue reliance on these forward-looking
statements. Except as may be required by law, Health Net undertakes no
obligation to address or publicly update any of its forward-looking
statements to reflect events or circumstances that arise after the date
of this release.
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