Exhibit 10.19

 

HEALTH NET, INC.

 

EXECUTIVE OFFICER INCENTIVE PLAN

PERFORMANCE GOALS

 

On February 24, 2005, the Compensation Committee of the board of directors of
Health Net, Inc. (the “Company”) established the 2005 performance goals for the
eligibility of the Company’s executive officers for bonus awards under the
Company’s Executive Officer Incentive Plan approved by stockholders in 2000 (the
“Plan”). A copy of the Plan was included as Annex A in the Company’s definitive
proxy statement for its 2000 annual meeting of stockholders, filed with the
Securities and Exchange Commission on March 31, 2000. In connection with the
establishment of the 2005 performance goals, the Compensation Committee
designated certain of its executive officers as eligible to participate in the
Plan for 2005. Executive officers not receiving awards under the Plan are
eligible for awards under the Company’s Management Incentive Plan based upon the
same performance goals. For 2005, the Plan is to be funded based on the Company
attaining its earnings per share goals as approved by the Compensation
Committee. Actual incentive awards for 2005 are to be paid on performance
against pre-established corporate, business unit and individual performance
goals. Corporate goals for 2005 are based upon earnings per-share, commercial
membership and employee satisfaction improvement. Business unit goals vary, but
are based on financial and operating performance and employee satisfaction
improvement. Individual goals vary across the individual executive officers and
include revenue and growth measures and internal climate measures. The
Compensation Committee established individual target bonuses so that a
participant under the Plan would be entitled to receive from 50% to 125% of his
or her base salary as a target bonus, with a payout ranging from 0% to 125% of
target bonus depending upon the attainment of total performance goals. The
Compensation Committee has the discretion to reduce but not increase the amount
of a participant’s bonus under the Plan.