Health Net used to pay bonuses based on the number of policy holders who were cancelled. LATimes (02.23.08):
"One of California's largest for-profit insurers stopped a controversial practice of canceling sick policyholders Friday after a judge ordered Health Net Inc. to pay more than $9 million to a breast cancer patient it dropped in the middle of chemotherapy. The ruling by a private arbitration judge was the first of its kind and the most powerful rebuke to the state's major insurers whose cancellation practices are under fire from the courts, state regulators and elected officials. Health Net ordered to pay $9 million after canceling cancer patient's policy"Calling Woodland Hills-based Health Net's actions 'egregious,' Judge Sam Cianchetti, a retired Los Angeles County Superior Court judge, ruled that the company broke state laws and acted in bad faith." Health Net cancelled Patsy Bates' policy back in January 2004, right in the middle of her treatment. She "was stuck with more than $129,000 in medical bills and was forced to stop chemotherapy for several months until she found a charity to pay for it." Health Net's CEO "ordered an immediate halt to cancellations and told The Times that the company would be changing its coverage applications and retraining its sales force." "'I felt bad about what happened to her,' he said. 'I feel bad about the whole situation.'" There are three other cancellation lawsuits pending, and a class action suit on the way. Just damn those lawyers.