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Insurer Rewarded Staff Who Canceled Policies

Internal documents show Health Net has paid bonuses based on how many policies were canceled and how much money the insurance company saved as a result. The information was revealed as part of lawsuit

Insurer Rewarded Staff Who Canceled Policies

Internal documents show Health Net has paid bonuses based on how many policies were canceled and how much money the insurance company saved as a result. The information was revealed as part of lawsuit against the insurer, filed by a hairdresser whose coverage was terminated. KPBS reporter Kenny Goldberg has more.

Patsy Bates was getting treatment for breast cancer when Health Net canceled her policy. The insurer says the action was justified, because Bates didn't disclose some of her medical history on her application.

Court documents show Bates' plan was one of nearly 1600 policies Health Net yanked over the last six years. During that time, the company paid bonuses to a senior analyst for exceeding cancellation goals. William Shernoff is Bates' attorney.

William Shernoff: I've been involved in this insurance bad faith litigation for probably 35 years now, and this is a bad as it gets in my opinion.

Bates is asking for $6 million dollars and punitive damages from Health Net. A decision in the case is expected by the end of the year. Kenny Goldberg , KPBS News.