Annual Meeting of Stockholders

Health Net Inc. reported unaudited consolidated earnings results for the first quarter ended March 31, 2013. For the quarter, the company reported total revenues of $2,797,037,000, income from operations before income taxes of $81,303,000 and net income of $50,050,000 or $0.62 per diluted share compared to total revenues of $2,830,399,000, loss from operations before income taxes of $13,561,000 and net loss of $26,586,000 or $0.32 per diluted share over the same period last year. Net cash used in operating activities was $28,185,000 against net cash provided by operating activities of $4,167,000 a year ago. Purchases of property and equipment were $13,690,000 against $15,373,000 a year ago. Income from continuing operations was $50,050,000 against loss from continuing operations of $8,134,000 a year ago period. The company provided earnings guidance for the full year of 2013. The company expected consolidated revenues to be in the range of $10.7 billion to $11.2 billion. Tax rate was expected to be in the range of 38.0% to 39.0%. Earnings per diluted share were expected to be in the range of $2.20 to $2.30. The company continues to expect full year 2013 operating cash flow to be at least equal to the revised expectations for net income plus depreciation and amortization. G&A expenses in the ratio of 9.0% to 9.4%.

The California Public Employees' Retirement System (CalPERS) announced that five companies will administer its Health Maintenance Organization plans for the next five years. The CalPERS Board of Administration voted to award HMO contracts to Anthem Blue Cross, Blue Shield of California, Health Net, Sharp and United Health Care. The five-year contracts will begin January 1, 2014, and run through December 31, 2018. CalPERS will also continue to offer Kaiser Permanente as one of its HMO options for members. The Board made its decision after reviewing the final staff evaluations of the responses to the Request for Proposals (RFP) for health plan administrators that CalPERS issued in October. CalPERS challenged bidders to offer innovative approaches for its health program and fully explore all options to provide high-quality, affordable care. The bidders' technical and financial responses had to meet stringent requirements, and staff found that most of the proposals offered high-quality health benefits and demonstrated a long-term commitment to reducing costs and an ability to meet CalPERS needs. The HMO contract will affect more than 400,000 members currently enrolled in Blue Shield of California HMO Plans.