More than 2,000 employees are being laid off Health Net Inc. but will be offered jobs with information technology contractor Cognizant Technology Solutions Corp. as part of a multi-year agreement, the health insurer said Wednesday.
About 1,174 of the employees are in Woodland Hills and another 878 are in offices in Rancho Cordova, outside Sacramento.
The layoffs were disclosed in a Workers Adjustment and Retraining Notice that the Woodland Hills insurer filed with the state Employment Development Department. They are required whenever a company plans to lay off at least 50 workers. The notice said the layoffs would take effect June 26.
However, company spokesman Brad Kieffer maintained that no workers will lose their jobs and instead will be hired on by Cognizant or one of its subcontractors.
“They are going to be rebadged,” Kieffer explained. “That means they will perform the same duties for Health Net but with a different employer.”
A representative of Cognizant would not confirm that the 2,052 employees would be hired and referred questions to Health Net.
In November, Health Net and Cognizant signed a seven-year agreement to implement a program to help Health Net manage a larger number of clients and reduce administrative costs.
Cognizant will provide consulting and technology to improve claims management, membership communication, quality assurance, and appeals and grievance services. Cognizant must meet specific metrics for improving quality and efficiency under the agreement..
Health Net shares closed down 12 cents, or a fraction of 1 percent, to $58.84 on the New York Stock Exchange.