Health Net is leaving California group plans. What do I do?
Health Net is exiting the California small group and large group medical markets, and every affected employer must move to another carrier by 28 February 2027. Employer notices were mailed on 1 September 2026. Your plan keeps working until your transition date, so nothing lapses this month, but you do need to choose a replacement before your final renewal rather than after it.
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The detail
Health Net is exiting the California small group and large group medical markets. This is a withdrawal from those segments rather than a plan change or a rate increase, so staying put is not an option that exists.
Groups enrolled through CalChoice are included in the exit. CalChoice-specific transition guidance was still to be published when this page was written.
Employer notifications were mailed on 1 September 2026. A notice arriving in early September is the real thing rather than a mistake or a marketing letter.
The final new business effective date was 1 September 2026 and the final renewal effective date is 1 February 2027. All affected small group and large group employers must transition off Health Net by 28 February 2027.
Medi-Cal, Marketplace and Covered California, and Medicare lines are not affected by this exit. Only commercial small group and large group medical is withdrawing.
What this means for you
- Your date is your renewal date, not February. The 28 February 2027 deadline is when the door closes for everyone, but each group moves at its own transition point, and the last renewal Health Net will write is 1 February 2027. Work backwards from your own renewal rather than from the headline.
- Nothing lapses while you decide. Coverage continues to your transition date, so there is no gap to panic about this week. The risk is not a lapse. It is arriving at your renewal with one option and no time to compare it.
- If you are on CalChoice, you are included. The published guidance puts CalChoice groups inside the exit, so treat any message suggesting otherwise as out of date and check your own notice.
- The network matters more than the premium here. A carrier move can quietly drop the physician half your staff already sees, and that is the complaint that follows you for a year. Bring a list of the doctors and hospitals people would be upset to lose, and have it checked against each replacement network before you compare prices.
- Prescriptions are the second thing to check. Formularies differ between carriers, and a specialty drug that was covered can land in a different tier. If anyone on the plan takes something expensive, name it early.
- Start now because the market gets busier, not cheaper, as the deadline approaches. Every affected employer in the state is being quoted by the same carriers between now and February.
Related questions
- Will my Health Net plan stop working immediately?
No. Coverage continues until your group transitions, and the final renewal effective date is 1 February 2027. Claims are paid normally in the meantime. What has changed is that the plan you have now has an end date, so the work is choosing what replaces it rather than dealing with an interruption.
- What happens if we do nothing?
All affected groups must be off Health Net by 28 February 2027, so doing nothing does not preserve the plan. It only removes your choice about what comes next and leaves your employees without a plan on the day the exit completes. The published guidance is explicit that groups must transition by that date.
- Does this affect our dental, vision or life plans?
This exit is from the small group and large group medical markets. Ancillary lines are placed separately and are not automatically part of it, but they are frequently bundled or rate-tied to the medical carrier, so it is worth checking what your dental and vision are actually attached to while you are moving the medical.
- Will our rates go up when we move?
Nobody can answer that honestly without your census. Rates depend on your employees’ ages, zip codes, family tiers and the plan design you choose, and a carrier exit does not by itself mean a worse price. The useful thing is to see the actual numbers side by side early enough to have a choice, which is why the census is the first step rather than the last.
- Can we use this as a chance to change how we do benefits?
Yes, and it is the natural moment. A forced move is when employers most often look at level funded plans or at reimbursing individual coverage through an ICHRA instead of buying a group plan at all. Those are not automatically better and they are not for everyone, but you are already doing the work of comparing, so it costs little to see them alongside the like-for-like replacement.
- How quickly can you tell us what our options cost?
Once we have your employee census, we go straight to market. The census is the whole bottleneck: carriers need the same handful of facts about everyone you employ before anyone can quote, which normally means an employer filling in a spreadsheet nobody enjoys. Ours is a form, and a licensed agent replies the same business day.
Need this handled?
Reading about it and having it handled are different jobs, and the second one is ours. We place the accounts other brokers decline — claims history, a cancellation, an unusual operation, a business nobody wants to underwrite twice — and we will tell you when the policy you already have is the right one. Tell us the situation and a licensed human replies the same business day.
Written by the licensed brokers at Boring Insurance. Last updated 2026-09-03. See all guides.