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When it comes to health care, how big is too big?
That was a question recently asked by the California Department of Justice, which filed a lawsuit against Sutter Health, a Sacramento-based nonprofit with 24 hospitals and 5,500 doctors.
California’s Attorney General was concerned by a number of anti-competitive practices carried out by Sutter Health, including prohibiting insurers from offering incentives to doctors to steer patients toward treatments that are less expensive but equal to or better in quality.
The Sacramento Bee reports that Sutter didn’t want to take their chances in court, reaching an agreement instead to end the legal trial.
Prior to the settlement agreement, The New York Times, reported that Attorney General Xavier Becerra had found that health care consumers in Northern California pay thousands more for certain hospital procedures than consumers living in Southern California, where Sutter does not operate.
For example, hospital treatment for a heart attack costs about $25,000 in San Francisco vs. $15,000 in Los Angeles.
Even catching a cold can set consumers back in Sutter territory. A doctor’s visit for a common cold costs $250 in San Francisco vs. $122 in Los Angeles.
“There’s a point where you’re starting to show signs of a bully,” Becerra told the New York Times.
Sutter has steadfastly maintained that it was not violating antitrust laws and that there was no evidence it had “hurt competition”.
Becerra told the Sacramento Bee that he would seek remedies that included greater transparency and monitoring, saying: “We just want a market that works, that is competitive, and competition, if it’s real, ultimately delivers lower cost and higher quality. That’s what this is about. Whatever it takes to get that, that’s the solution.”
Consumer advocate Anthony Wright, leader of Health Access California, thinks this case will have an effect on healthcare provides across the country.
“This is a lawsuit that has been watched by hospital chains nationally, and I think it will make health care providers think twice about some of these anti-competitive practices,” Wright said. “Obviously, a lot depends on the details of the settlement, which we won’t know for many months, I believe, but even just the fact that the lawsuit was brought by Attorney General Becerra, by the union and business plaintiffs, that sends a really important signal not just to Sutter but nationwide to the health care industry.”
Do you think anti-competitive practices could be raising healthcare costs near you? Share your story with Voices for Affordable Health.