Health Net says payments from military delayed due to shutdown


Oct 9 (Reuters) - Managed care company Health Net Inc said payments for healthcare services it provides tomilitary families would be delayed due to the U.S. governmentshutdown.

The U.S. Defense Health Agency (DHA) said on Oct. 2 that itwould not be able to reimburse the company as it did not havethe legal authority, Health Net said in a regulatory filing.

Peer Humana said on Tuesday the shutdown would delaypayments related to its military health services contract.

The DHA notice said once funding was received, it would payHumana and Health Net with interest, the companies said.

Health Net, which has been providing managed care servicesto the Department of Defense for 25 years, said it wouldcontinue to administer the contract for a two-week obligationperiod and it could be liable for claims of about $106 millionduring that time if the government does not authorize payment.

Health Net said it had enough working capital and creditcapacity to fund the payment of the claims and the delay wouldnot adversely affect its results or financialposition.

Health Net provides health care services to 2.8 millionpeople under the Tricare program, which provides health benefitsfor active and retired military personnel and their families.

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