NEW YORK (AP) — Shares of Health Net Inc. (NYSE:HNT) climbed Monday after the health insurer said it had resolved Medicare disputes with the state of California and received several contract extensions.
Health Net provides commercial health insurance and administers Medicaid and Medicare coverage, and it does most of its business in California. Health Net said it is ending litigation against the state's Department of Health Care Services regarding cuts to Medicare and Medicaid reimbursement rates, and its four existing Medi-Cal contracts were each extended by five years.
The Woodland Hills, Calif., company also said it will develop a new process to help the agency meet its actuarial targets and a new way to dispute payment rates. The settlement ends a dispute over the way Health Net is paid to administer California's Medicaid program, programs for seniors and disabled people, and a pilot program for "dual eligibles," or people who are eligible for both Medicare and Medicaid. It also covers any future Medicaid expansions by the federal government, Health Net said.
Shares of Health Net jumped $2.99, or 13.2 percent, to $25.67 in afternoon trading.
