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Health Net, Inc.
Claims Handling and Rescission Practices
Date: 09/12/2008 (Date of Announcement)
Misconduct Type: Health
Enforcement Agency: State/Local
Contracting Party: None
Court Type: Administrative
Synopsis: Health Net agreed to pay the California Department of Insurance $3.6 million in penalties, $14.2 million in reimbursement and $7.2 million in waived insurance premiums and agreed to reinstate healthcare coverage of 926 people, whose individual and family policies were rescinded during the past four years. Health Net also agreed to establish an independent, third-party review process for future rescission decisions and make significant changes to its application form, underwriting process, agent training, and notification of consumers under investigation for information on their applications.