Health Net charged $41M for underpaying out-of-network claims

Health plan Health Net has paid out $41 million to the New Jersey state Department of Banking and Insurance to settle charges that it underpaid out-of-network claims for 88,000 customers in the state. State officials say the plan underpaid for out-of-network services between 1996 and 2006. The settlement includes paying $14 million back on underpaid claims to customers, $12 million in interest, $13 million in fines and $2 million to cover examination costs. This represents, by far, the largest restitution agreement and fine administered by the Department of Banking and Insurance, according to a spokesman there. More than 55,000 reimbursement checks have been sent out to plan members, ranging from a few dollars to several thousand.

Previously, in 2002, Health Net paid restitution of more than $800,000 for claims under-paid for more than 4,700 members in New Jersey. Earlier this year, meanwhile, Health Net agreed in federal court to pay class-action settlements totaling $225 million to as many as 2 million people who filed out-of-network claims from September 1997 through July 2007.

To learn more about the settlement:
- read this article from The Record (NJ)

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