Insurer settles with hospitals for at least $1.95M

Written by Shaya Tayefe Mohajer, AP Writer

Thursday, 28 May 2009 14:16

(AP) — A nearly $2 million settlement has been reached between insurer Health Net and California hospitals over patients who were dropped from coverage after they were provided with medical care. Health Net of California has agreed to create a $1.95 million fund that will provide hospitals with payments they were unable to collect when the insurer cut off some patient policies. The settlement covers Health Net rescissions between February 2004 and October 2007 and says the insurer admits no fault in the cases. In a statement, a Health Net spokesman says the company is pleased to have resolved the litigation, and has improved its vetting process for accepting new policyholders. Additionally, Health Net will pay the lawsuit's organizer, the California Hospital Association, $15,000.