Health Net Issues 2010 Earnings Guidance

Health Net, Inc. (NYSE:HNT) today announced its 2010 earnings guidance of $1.90 to $2.00 per diluted share which includes the impact of approximately $69 million in pretax charges¹, or approximately $42 million after-tax. These charges are expected to have a $0.40 impact on earnings per diluted share in 2010. On an adjusted² basis excluding the charges, the company expects to earn between $2.30 to $2.40 per diluted share in 2010. The adjusted² earnings per diluted share guidance is based on the company’s expectation that the pending sale of the Northeast businesses will close on or before year-end 2009 and excludes any run-out revenues and expenses related to the wind-down of the Northeast operations. In addition, the adjusted² guidance is based on the following operating and financial assumptions:

• 2010 year-end health plan enrollment will be flat compared to year-end 2009
• Total revenues of between $13.0 billion to $13.5 billion
• A full year of earnings contribution from the current TRICARE contract
• Investment income of approximately $62 million to $68 million
• Tax rate of approximately 39 percent
• Total weighted-average shares outstanding of approximately 104 million to 105 million

Health Net expects to provide more detailed guidance at its annual Investor Day on February 11, 2010.

Footnotes

¹ The company currently expects to incur approximately $69 million in pretax charges in 2010. These charges include approximately $53 million related to the wind-down of the company’s Northeast businesses and approximately $16 million related to the company’s operations strategy. The company currently expects these charges to impact general and administrative expenses.

² Management believes that the presentation in this press release of earnings per diluted share, as adjusted to exclude charges expected to be recorded in 2010, which is non-GAAP financial information, is important to investors as it excludes special charges that are not indicative of the company’s core operating results. Non-GAAP financial information should be considered in addition to, not as a substitute for, financial information prepared in accordance with GAAP.

About Health Net

Health Net, Inc. is among the nation’s largest publicly traded managed health care companies. Its mission is to help people be healthy, secure and comfortable. The company’s health plans and government contracts subsidiaries provide health benefits to approximately 6.6 million individuals across the country through group, individual, Medicare, Medicaid and TRICARE and Veterans Affairs programs. Health Net’s behavioral health subsidiary, MHN, provides mental health benefits to approximately 6.5 million individuals in all 50 states. The company’s subsidiaries also offer managed health care products related to prescription drugs, and offer managed health care product coordination for multi-region employers and administrative services for medical groups and self-funded benefits programs.

For more information on Health Net, Inc., please visit the company’s Web site at www.healthnet.com.

Cautionary Statements

All statements in this press release, other than statements of historical information provided herein, including the guidance for future periods and the assumptions underlying such projections, may be deemed to be forward-looking statements and as such are subject to a number of risks and uncertainties. These statements are based on management’s analysis, judgment, belief and expectation only as of the date hereof, and are subject to uncertainty and changes in circumstances. Without limiting the foregoing, the guidance as to expected future period results and statements including the words "believes,” "anticipates,” "plans,” "expects,” "may,” "should,” "could,” "estimate,” "intend” and other similar expressions are intended to identify forward-looking statements. Actual results could differ materially due to, among other things, any failure to close the pending sale of our Northeast business; costs, fees and expenses related to the pending sale and proposed post-closing administrative services; potential termination of our TRICARE North operations; the potential impact of health care reform on our business; rising health care costs; a continued decline in the economy; negative prior period claims reserve developments; investment portfolio impairment charges; volatility in the financial markets; trends in medical care ratios; unexpected utilization patterns or unexpectedly severe or widespread illnesses; membership declines; rate cuts affecting our Medicare or Medicaid businesses; litigation costs; regulatory issues; operational issues; and general business and market conditions. Additional factors that could cause actual results to differ materially from those reflected in the forward-looking statements include, but are not limited to, the risks discussed in the "Risk Factors” section included within the company’s most recent Annual Report on Form 10-K, subsequent quarterly reports on Form 10-Q, and the risks discussed in the company’s other filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements. The company undertakes no obligation to publicly revise its guidance, the assessment of the underlying assumptions or any of its forward-looking statements to reflect events or circumstances that arise after the date of this release.