The California Attorney General announced that his department had filed a lawsuit against health giant Sutter Health.
Attorney General Xavier Becerra has announced the lawsuit on Friday at a press conference in his office. The lawsuit was filed Thursday in the San Francisco County Superior Court.
Becerra's office claims that Sutter Health has been conducting anti-competitive business practices that have resulted in illegal price increases for Californians, particularly in Northern California.
The complaint alleges that Sutter Health wanted to maintain control of prices, avoiding any kind of competition, avoiding competition from others in the industry, and wanting to create higher health care prices that they could not ultimately have had in an open one Calculate market.
"We intend to protect competition in the healthcare market here in California and protect patients from artificially high prices for their family's healthcare," Becerra said. "The consequences of these practices for Northern California families are and were real, and the consequences for our economy were and are real."
In addition, the AG's office said Sutter Health was able to raise prices by requiring insurance companies would be forced to "all or nothing" system. The system forced insurance companies to work only within Sutter Health units and prevented these companies from offering cheaper health plan options to patients.
The lawsuit also alleges that Sutter Health set prices that were too high for physicians outside the network, and lacked transparency in not publishing what they demand for health care.
"The practices that Sutter has insisted on have the North Californian market of competition that should be there," said Kathleen Foote, Senior Assistant Attorney General.
Becerra cited a UC Berkeley report that Northern California's consolidated market means that consumers pay much higher rates for the average hospital inpatient procedures than their southern California counterparts.
For residents of Northern California, this cost was approximately $ 223,000. For those in Southern California, the cost was about $ 1
Karen Garner, a spokeswoman for Sutter Health, said the company was aware of the complaint but could not comment on the specific allegations because the company did not review them. It issued the following statement:
Sutter Health prides itself in saving patients, government payers and health plans hundreds of millions of dollars each year through more efficient and integrated care. It is important to note that publicly available data (from the OSHPD) shows that the overall cost of hospitalization in a Sutter hospital is on average lower than in other North American hospitals.
In addition, Sutter Health has maintained its overall average rate Since 2012, health plans have been rising to the low single-digit range, even though our actual spending on labor, facilities and technology has increased more than 37 percent over the same period. We do not know why some health plans have increased their prices for consumers by 20 percent annually.
It is also important to note that there is healthy competition and choice in Northern California. There are 15 major hospital systems and 142 hospitals in Northern California, including Kaiser Permanente, Dignity, Adventist, Tenet, UC and more. And health plans may elect to include or exclude portions of the Sutter healthcare system from their networks, and health plans have been doing so for many years.