“After thorough review including extensive public input, I concluded that this transaction provides an opportunity to bring new capital and resources from a major national health insurer largely outside of California (Centene) to enable a California health insurer (Health Net) to continue to compete and offer health consumers additional choices in California’s individual, small group and large group commercial health insurance market,” Mr. Jones said in a statement.
Mr. Jones’ conditions for the acquisition include the following:
1. There won’t be merger costs for California consumers.
2. Health Net will keep its commercial line of business.
3. Health Net “will continue to offer products through Covered California,” according to the press release.
4. Together, Health Net and Centene have to supply consumers with timely and sufficient access to provider networks.
5. Health Net and Centene “must improve the quality of care delivered through their health insurance,” according to the press release.
6. The insurers have to work together to create better health insurance rates, and they must use the same techniques they used before merging. They must also agree that increases will be minimal.
7. Health Net and Centene must keep a sufficient distribution channel for Health Net’s insurance.
8. Health Net’s upper level management must remain in California. There are limits on whether Centene can move Health Net’s operations out of the state.
9. Centene will make a $200 million infrastructure investment to create a call center in California.
10. The insurers “will invest an additional $30 million in California’s low and moderate income neighborhoods, with investments prioritized for health facilities,” according to the press release.
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