“Market Cap $2.25 B As of May 2013
At a Glance
- Industry: Managed Health Care
- Founded: 1979
- Country: United States
- CEO: Jay Gellert
- Website: www.health.net
- Employees: 7,286
- Sales: $11.29 B
- Headquarters: Woodland Hills, California
#1993 Global 2000
- #853 in Sales
Health Net, Inc. is a managed care company that delivers managed health care services through health plans and Government-sponsored managed care plans. It operates in three segments, Western Region Operations, Government Contracts and Northeast Operations. It provides and administers health benefits to approximately six million individuals across the country through group, individual, Medicare, Medicaid, the United States Department of Defense (DoD), including TRICARE, and Veterans Affairs programs. Its behavioral health services subsidiary, Managed Health Network, Inc., provides behavioral health, substance abuse and employee assistance programs to approximately five million individuals, including its own health plan members. Its subsidiaries also offer managed health care products related to prescription drugs. In April 2012, its subsidiary, Health Net Life Insurance Company, sold its Medicare stand-alone Prescription Drug Plan (Medicare PDP) business to a subsidiary of CVS Caremark.”
“Health Net History
Health Net of California was first established as a non-profit corporation in 1977. A 1992 state of California order permitted the health care company to convert itself from a nonprofit into a for-profit company. At the same time, the state order required the new company to transfer 80% of its equity to the California Wellness Foundation, a successor charity to its non-profit status. Under the terms of the California Department of Corporations’ conversion order approving Health Net’s for-profit status, the California Wellness Foundation received $300 million plus 80 percent of the equity of Health Net’s parent holding company.
In August 1993, Health Net merged with Qualmed to form Health Systems International. The merger created a 1.8 million member HMO with a market value of $725 million, one of the biggest publicly traded health care companies at the time. Dr. Malik Hasan had founded Qual-Med, with his wife Seeme Hasan in southern Colorado. Qual-Med first went public in June 1991.
In May 1997 Health Systems International merged with Foundation Health Corporation to form Foundation Health Systems. At the time of the merger the newly created Foundation Health was valued at $1.27 billion and was the 4th largest health insurer in the U.S. and the second largest HMO in California. It had more than 5 million members in 17 states and in 2.8 California. In November 2000 Foundation Health Systems officially changed its name to Health Net, Inc. when the company started trading on the New York Stock under the symbol HNT.
State-specific divisions existed under a variety of names prior to the 2000 renaming of Health Net, Inc.:
- Health Net of California Inc., the company’s California division, incorporated in 1977
- Founded as QualMed Oregon Health Plan, it was officially renamed Health Net Health Plan of Oregon in 2000, Inc.
- Health Net of Arizona, Inc. was founded in 1981, as Intergroup of Arizona by a multi-specialty medical group in Tucson. In 1994, Intergroup became a wholly owned subsidiary of Foundation Health Corporation.
In July 2009, UnitedHealth Group bought Health Net’s northeastern licensed subsidiaries for $450 million. At the time,the subsidiaries had 578,000 members in Connecticut, New York and New Jersey. In January 2012, Health Net sold its Medicare Prescription Drug Plan business to a subsidiary of CVS Caremark for approximately $160 million in cash.”
*Information from Forbes.com and Wikipedia.org
**Video published on YouTube by “Health Net“