Health Net of California Settles With Hospitals for $1.95M

Health Net of California has agreed to create a $1.95 million fund to repay hospitals for costs associated with patients whose coverage was dropped after receiving medical care, according to a report in the San Jose Mercury News.

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The settlement is the result of a lawsuit organized by the California Hospital Association, which represents 400 hospitals and covers the rescission of nearly 1,000 patients between Feb. 2004 and Oct. 2007, according to the report. The insurer admits no fault in the cases.

Health Net will also pay $15,000 to the California Hospital Association.

In Sept. 2008, the company settled with the California Department of Insurance, in which it agreed to offer new coverage to 926 customers who were dropped from individual or family policies in the years since 2004 and pledged to repay up to $14.2 million in outstanding medical expenses and waive up to $7.2 million in insurance premiums. The company was also fined $3.6 million, according to the report.

Read the Mercury News’ report about the Health Net of California hospital settlement.

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