Health Net Is Leaving California's Group Market. Here Is What Employers Need to Do.

If you have a Health Net group health plan, you have a deadline. Every group has to be off Health Net by February 28, 2027. This is not a rate increase you can negotiate or absorb. It is an end date.

What Health Net announced

In the first week of September 2026, Health Net notified employers that it is exiting the California commercial group health market. Notices went out to employers by mail and by email.

Health Net is no longer accepting new group business. The last renewal effective date is February 1, 2027. All group coverage ends by February 28, 2027. Each group receives its specific end date in its formal notice from Health Net.

This affects commercial group plans. Health Net's Medi-Cal, Medicare, and Covered California individual plans are not affected. If you have individual coverage through Health Net, none of this applies to you.

One thing to note is that reporting differs on whether this exit covers dental and vision in addition to medical. Confirm your specific lines with Health Net or your broker rather than assuming either way.

Your renewal date decides how much time you actually have

The February deadline is the same for every group. The working time you have before it is not.

A group renewing in October or November has a normal renewal cycle. There is room to gather quotes, compare networks properly, and give employees time to ask questions before anything changes.

A group renewing in January or February has a compressed one. You would be shopping at the same time as every other Health Net group in California, during the busiest weeks of the benefits calendar.

Check your renewal date before you do anything else. It tells you whether this is a routine project or an urgent one.

What happens if you do nothing

Coverage does not roll over to another carrier on its own. If February 28, 2027 arrives and the group has not moved, employees are uninsured. There is no automatic placement and no grace period that fixes it afterward.

A lapse also creates problems beyond the coverage gap itself. Employees who lose group coverage may qualify for a special enrollment period on the individual market, but that shifts the work and usually the cost onto them. For an employer, an unplanned lapse is the kind of thing a workforce remembers.

Why moving early is worth something

Carriers have underwriting capacity, and it is not unlimited. When a large number of groups leave one carrier in the same window, the receiving carriers become more selective about which groups they want and slower to turn quotes around.

Groups that move early get their cases properly worked and have real choices in front of them. Groups that wait take what is still available in February, quoted in a hurry, with no time to push back on anything.

What to compare, in the right order

Look at provider networks first. Employees will forgive a higher deductible. They will not forgive losing a doctor they have seen for ten years. Pull your census, identify the physicians and hospitals that matter to your people, and check them against each carrier's network before you look at a single rate.

Look at plan design second. Match the deductible, out of pocket maximum, and copay structure against what your employees have now. A plan that looks cheaper on the invoice often is not once you account for what employees pay at the point of care.

Look at premium third. It matters. It is also the easiest number to compare and the least likely to be the thing that goes wrong six months from now.

One thing to note is continuity of care. If an employee is in the middle of a course of treatment, ask the receiving carrier about their continuity of care provisions before you commit. Some carriers will honor existing treatment with an out of network provider for a limited period. That question is much easier to ask in October than in February.

What to do now

1. Find your renewal date and write it down. Everything else follows from it.

2. Pull your current plan documents, your most recent bill, and your census. Quotes are only useful next to what you have now.

3. Make a list of the providers your employees actually use. Ask them if you do not know.

4. Start quoting now rather than waiting for your renewal to come around.

5. Give employees notice as early as you can. A carrier change is far easier to accept when it does not arrive as a surprise two weeks before the effective date.

If you want help with this

We work with California small groups on exactly this kind of transition. If you are on Health Net and want help mapping your options, we can pull quotes from the carriers still writing in your area, check networks against your actual employee roster, and walk your team through the change.

Use the contact form on our Contact page and tell us about your group. We come back to you the same business day. You can also call (626) 628-0859 or email info@totalinsuranceagency.com.

Send us your current plan documents and census and we will review them before we quote anything. Please let me know if you have any questions.