1:12:52 AM PDT - Tuesday, September 28th, 2021

After 18 Months, Sutter Antitrust Settlement Finally Poised for Formal Approval  

By Editor - Thu Jul 22, 10:14 pm

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More than 18 months after Sutter Health agreed to a tentative settlement in a closely watched antitrust case joined by the California Attorney General’s Office, the judge presiding over the case indicated she would sign off on the terms, pending agreement on attorney fees. The nonprofit health care giant, based in Sacramento, stood accused of violating California’s antitrust laws by using its market dominance to drive up prices.  The settlement is expected to have nationwide implications on how hospital systems negotiate prices with insurers.  “These plaintiffs are among the first, but will not be the last, to successfully challenge dominant health care systems who undertake land grabs to mark up prices at the expense of patients and employers,” Leemore Dafny, a Harvard Business School professor who studies the industry, wrote in an email. “This settlement has provided a marker for the rest of the nation.”  The settlement, which includes $575 million in damages, was announced on a preliminary basis in December 2019. It marked a dramatic turn in a  long-running legal battle  initiated in 2014 as a class-action lawsuit filed by the United Food and Commercial Workers International Union & Employers Benefit Trust, representing employers, unions and local governments whose workers use Sutter services. Then-Attorney General Xavier Becerra joined the case in 2018.  Numerous twists and turns have slowed the court’s approval of the settlement in the months since.  San Francisco Superior Court Judge Anne-Christine Massullo had been expected to issue a preliminary approval of the terms in August 2020, but rejected the independent monitor the parties had chosen to oversee the rollout of the agreement. The monitor chosen was neither a woman nor a person of color, and Massullo said the parties’ selection process did not properly take into account the court’s emphasis on diversity, equity and inclusion.  More months passed as  Sutter argued  for further delays and suggested it would push to alter the settlement in light of the potentially dramatic effects of the covid-19 pandemic on the health care system’s finances and operations.  Preliminary approval was eventually granted, but most recently, final approval was postponed because of a dispute between UEBT and their lawyers over attorney fees. The parties had agreed at the outset to plaintiffs’ attorneys, led by Richard Grossman of Pillsbury & Coleman, getting 30% of the settlement amount.

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After 18 Months, Sutter Antitrust Settlement Finally Poised for Formal Approval

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