Sutter Health is being hit with a lawsuit. Three million employers and people are seeking as much as $1.2 billion from the Northern California health system.
Plaintiffs in the lawsuit allege in court documents that Sutter Health abused its market power and “caused enormous adverse economic impacts” by discouraging patients from using lower-cost insurance and lower-cost hospitals.
The lawsuit claims Sutter used its market power for inpatient services in seven mostly rural Northern California areas where it is the only or dominant hospital to bind insurers in four other communities where it has competition.
That allowed Sutter to overcharge for its own services, the lawsuit alleged, and caused nearly $400 million in insurance premium overcharges to the plaintiffs between 2011-2017. Five companies provided the health insurance: Anthem Blue Cross, Blue Shield of California, Aetna, United Healthcare, and Health Net.
The law allows triple damages if the plaintiffs win against Sutter Health, meaning a potential award of $1.2 billion.