Health Net Cuts Tenet From Network

Woodland Hills-based health insurer Health Net has dropped six Southern California hospitals operated by Tenet Healthcare from its provider network.

The hospitals are Desert Regional Medical Center in Palm Springs, Fountain Valley Hospital and Medical Center, John F. Kennedy Memorial Hospital in Indio, Lakewood Regional Medical Center, Los Alamitos Medical Center and Placentia Linda Hospital in Placentia.

The hospitals represent all the facilities the Dallas-based Tenet operates in Southern California.

Health Net officials claim it could not come to terms with Tenet on a new contract, which recently expired. It announced the terminations on Dec. 27, although they officially took place on Dec. 21. 

While Health Net did not divulge details of the negotiations, it suggested Tenet was seeking charge increases above 3 percent for commercial patients and increases for Medi-Cal enrollees that were “consistent” with current funding trends.

“The decision to proceed with the termination process was difficult,” said Steve Sell, president of Health Net’s Western Region Health Plan. “We had no choice, however, as Tenet has refused our requests to negotiate a new contract that more accurately reflects current statewide market conditions. Our goal is to help preserve affordable benefits for our customers, not pass along inflated healthcare costs.”

Tenet contended that it was close to terms with Health Net. 

“At the time of our last meeting, we were in full agreement on the terms of our contract,” the company said in a statement. “It is unclear to us as to why Health Net issued a contract termination and publicly released inaccurate information. We have full agreement with Health Net on reimbursement rates at these six hospitals. We are puzzled and disappointed by their public comments.”