Health Net 2009 Annual Report Download - page 539

ARTICLE IX.
CERTAIN ACTIONS BY THE COMPANY
Section 9.1. Provider Network Access.
(a) Subject to the Administrator’s responsibilities under Section 8.3, the Company and its Affiliates shall be responsible for
Participating Provider contracting and Participating Provider relations with respect to the Business (but only with respect to contracts
to which the Company is a party); provided, however, that the Administrator shall be responsible for contracting for and
administering mental health and pharmaceutical Provider networks and benefits for the Company as set forth in Section 9.1(d). With
respect to new or renewal Provider contracts, the Company and its Affiliates shall not intentionally seek to impose higher rates for
Providers under a Company Provider contract in order to favor United Affiliates, other than the Acquired Companies, with such
Provider; provided, however, the Parties acknowledge that such efforts will be affected by the fact that the Company is winding down
the Business.
(b) The Company and its Affiliates shall promptly provide the Administrator with a copy of any proposed amendment to or
renewal of a Provider contract with respect to the Business that changes the reimbursement structure with such Provider or any
proposed new Provider contract with respect to the Business for the Administrator’s prior review and reasonable approval solely for
the purpose of determining that Administrator is able to administer such Provider contract without incurring undue cost or expense
inconsistent with the Company’s past practice (whether for systems implementation, loading, manual administration or otherwise)
and without degradation of its ability to comply with the Service Standards. The Company will consider the Administrator’s
reasonable input with respect to proposed changes to Provider contracts to improve administrative efficiency and reduce costs
(including systems implementation, automatic payment, and ease of loading). To the extent new or renewal Provider contracts result
in a degradation of the Administrator’s ability to comply with the Service Standards, the parties will cooperate to develop adjustments
to the Service Standards, taking into account such new or renewal Provider contracts. The Company may not terminate any Provider
contract without the Administrator’s prior written consent (which consent shall not be unreasonably withheld, conditioned or
delayed).
(c) If necessary to maintain sufficient network adequacy for the Business or to meet the Company’s expected medical costs
per unit on an aggregate basis, United will permit (or cause one or more of its Affiliates to permit) the Company access to certain
Provider contracts and rates of the Company’s Affiliates for the purpose of providing services to Contract Holders covered under the
Administered Contracts and only as allowed by such Provider contracts and applicable Law; provided, however, that the United and
its Affiliates shall not intentionally seek to charge the Company higher rates than those charged to any of the Company’s Affiliates
for similar services. In the event such access is necessary and permissible, the Parties will mutually agree upon a reasonable transition
plan, on a case-by-case basis, before access to such Provider contracts as set forth in this Section 9.1 will begin.
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