SUPPLEMENTAL SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY ONLY)

HEALTH NET, INC.

CONDENSED STATEMENTS OF OPERATIONS

(Amounts in thousands)



	Year Ended December 31,
	2012			2011			2010
REVENUES:
Net investment income	$	1,459		$	493		$	44
Other income (loss)	204			690			33,172
Administrative service fees	478,037			493,637			472,828
Divested operations and services revenues	—			33,377			92,582
Total revenues	479,700			528,197			598,626
EXPENSES:
General and administrative	470,156			649,524			438,463
Depreciation and amortization	30,408			33,061			36,532
Interest	35,112			34,456			40,594
Divested operations and services expenses	—			33,377			93,035
Asset impairments	—			—			4,133
Early debt extinguishment charge	—			—			513
Total expenses	535,676			750,418			613,270
Loss from operations before income taxes and equity in net income of subsidiaries	(55,976		)	(222,221		)	(14,644		)
Income tax benefit	5,633			132,690			5,604
Equity in net income (loss) of subsidiaries	172,406			161,651			213,283
Net income	$	122,063		$	72,120		$	204,243

See accompanying notes to condensed financial statements.

SUPPLEMENTAL SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY ONLY)

HEALTH NET, INC.

CONDENSED BALANCE SHEETS

(Amounts in thousands)



	December 31, 2012			December 31, 2011
ASSETS
Current Assets:
Cash and cash equivalents	$	105,809		$	87,948
Other assets	36,351			23,407
Due from subsidiaries	169,853			101,701
Total current assets	312,013			213,056
Property and equipment, net	145,821			108,150
Goodwill	319,732			346,100
Other intangible assets, net	1,823			2,448
Investment in subsidiaries	2,648,148			2,594,762
Deferred taxes	17,823			—
Other assets	66,857			65,180
Total Assets	$	3,512,217		$	3,329,696
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Due to subsidiaries	$	223,612		$	152,276
Deferred taxes	18,807			12,249
Other liabilities	96,162			75,556
Total current liabilities	338,581			240,081
Intercompany notes payable—long term	987,746			996,849
Long term debt	499,095			511,390
Other liabilities	129,765			138,230
Total Liabilities	1,955,187			1,886,550
Commitments and contingencies
Stockholders’ Equity:
Common stock	149			147
Additional paid-in capital	1,329,000			1,278,037
Treasury common stock, at cost	(2,092,625		)	(2,023,129		)
Retained earnings	2,293,522			2,171,459
Accumulated other comprehensive income	26,984			16,632
Total Stockholders’ Equity	1,557,030			1,443,146
Total Liabilities and Stockholders’ Equity	$	3,512,217		$	3,329,696

See accompanying notes to condensed financial statements.

SUPPLEMENTAL SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY ONLY)

HEALTH NET, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(Amounts in thousands)



	Year Ended December 31,
	2012			2011			2010
NET CASH FLOWS PROVIDED BY OPERATING ACTIVITIES	$	165,141		$	252,100		$	155,740
CASH FLOWS FROM INVESTING ACTIVITIES:
Sales on investments	—			—			7,115
Sales of property and equipment	—			—			12
Purchases of property and equipment	(68,116		)	(48,046		)	(34,498		)
Notes receivable due from subsidiaries	7,000			(24,000		)	26,200
Capital contributions returned to Parent	1,500			1,796			1,182,635
Capital contributions to subsidiaries	(17,560		)	(400		)	(120,972		)
Sales (purchases) of restricted investments and other	876			(13,361		)	14,253
Net cash (used in) provided by investing activities	(76,300		)	(84,011		)	1,074,745
CASH FLOWS FROM FINANCING ACTIVITIES:
Net (decrease) increase in checks outstanding, net of deposits	(44		)	(37		)	248
Excess tax benefit on share-based compensation	3,222			544			286
Net borrowings from subsidiaries	(9,103		)	(14,246		)	(1,144,992		)
Proceeds from exercise of stock options and employee stock purchases	16,941			13,356			3,644
Proceeds from issuance of notes and other financing arrangements	110,000			978,500			100,000
Repayment of debt under financing arrangements	(122,500		)	(872,212		)	(200,000		)
Repurchase of common stock	(69,496		)	(389,850		)	(236,847		)
Net cash (used in) provided by financing activities	(70,980		)	(283,945		)	(1,477,661		)
Net increase (decrease) in cash and cash equivalents	17,861			(115,856		)	(247,176		)
Cash and cash equivalents, beginning of period	87,948			203,804			450,980
Cash and cash equivalents, end of period	$	105,809		$	87,948		$	203,804
SUPPLEMENTAL CASH FLOWS DISCLOSURE:
Interest paid	$	31,134		$	31,332		$	31,074
Income taxes paid	5,001			55,882			96,319

See accompanying notes to condensed financial statements.

SUPPLEMENTAL SCHEDULE I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

(PARENT COMPANY ONLY)

HEALTH NET, INC.

NOTE TO CONDENSED FINANCIAL STATEMENTS

Note 1—Basis of Presentation

Health Net, Inc.’s ("HNT") investment in subsidiaries is stated at cost plus equity in undistributed earnings (losses) of subsidiaries. HNT’s share of net income (loss) of its unconsolidated subsidiaries is included in consolidated income using the equity method.

This condensed financial information of registrant (parent company only) should be read in conjunction with the consolidated financial statements of Health Net, Inc. and subsidiaries.