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The government awards contracts to companies with histories of misconduct such as contract fraud and environmental, ethics, and labor violations. In the absence of a centralized federal database listing instances of misconduct, the Project On Government Oversight (POGO) is providing such data. We believe that it will lead to improved contracting decisions and public access to information about how the government spends hundreds of billions of taxpayer money each year on goods and services. Report an instance of misconduct »

Health Net, Inc.

Underpaying New Jersey Subscriber Claims

Date: 08/27/2008 (Date of Announcement)

Misconduct Type: Cost/Labor Mischarge

Enforcement Agency: State/Local

Contracting Party: Non-Governmental

Court Type: Administrative

Amount: $41,800,000

Disposition: Restitution

Synopsis: Health Net of New Jersey paid $26 million in unpaid claims and interest, $2 million in examination fees and a $13 million fine for allegedly underpaying 88,000 former and current New Jersey members for out-of-network medical claims between 1996 and 2006. The payments resulted from a 21-month state investigation into Health Net and its predecessors, First Option Health Plan of New Jersey and Physicians Health Services of New Jersey. As part of an earlier investigation, Health Net paid more than $800,000 in restitution to more than 4,700 members for underpayments occurring between July 2001 and October 2002.