Health Net v. Dept. Mental Health
The issues in this appeal arise from the implementation by the Department of Health Services (DHS) of a two-plan model that permits Medi-Cal beneficiaries in selected counties to choose between a commercial plan or a governmental plan for the provision of health care services. Health Net of California, Inc. (Health Net) was selected to provide the commercial plan and, in response to disagreements with DHS, filed separate petitions for writ of administrative mandamus, which were heard in 2004 and 2006. Court therefore affirm the denial of the petition for writ of administrative mandamus heard in 2004 insofar as it requests payment of interest on retroactive rate adjustments but reverse insofar as it seeks to allow Health Net to recover prepayment discounts deducted from retroactive adjustments. We affirm the denial of the petition heard in 2006 insofar as it rejects Health Nets request for additional compensation for administrative costs but reverse insofar as it erroneously concludes that the actuarys breach of contract was inconsequential. Court remand to DHS to calculate the rates for rate year 2001-2002 without imposing a mandated freeze based on the state deficit and by applying the trend factors required by contract.
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