Sutter Health reaches settlement with California, union before antitrust trial
SAN FRANCISCO — The big California health system Sutter Health today reached an agreement with the state of California and a union trust, avoiding a much-anticipated antitrust trial over whether its negotiating tactics with health plans amounted to anti-competitive behavior.
The settlement was announced by San Francisco Superior Court Judge Anne-Christine Massullo after a hearing. Terms won't be released until February or early March, she said.
The settlement would resolve a lawsuit filed in 2014 by a trust that pays health care costs on behalf of the United Food and Commercial Workers union and self-funded employers, as well as a separate suit filed in 2018 by Attorney General Xavier Becerra. The case became a symbol of concern over big hospital chains that require insurers to access their networks on an all-or-nothing basis and make it harder for plans to steer patients to lower-cost competitors.
Sutter, a nonprofit operating 24 hospitals that had $13 billion in operating revenue last year, denied any wrongdoing and had argued that insurers were trying to boost their profits and sell skimpier plans. It would have risked damages that could exceed $1 billion by going to trial.
“The parties involved have reached a settlement agreement. We cannot comment further until the final agreement is approved by the court," Becerra's office said in a statement. Sutter Health and the union trust didn't immediately respond to requests for comment.
The cases had been consolidated and were supposed to go to trial last week. Proceedings were delayed due to the loss of a number of jurors for medical and other reasons.
