Sutter Health motions to dismiss California AG's antitrust lawsuit: 5 things to know

Sacramento, Calif.-based Sutter Health filed a motion with the San Francisco Superior Court May 14 asking the court to dismiss state Attorney General Xavier Becerra's antitrust lawsuit against the health system, claiming the lawsuit would upend its business practices, according to The Sacramento Bee.

Here are five things to know about the case.

1. Following a six-year investigation into the 24-hospital system, Mr. Becerra filed an antitrust lawsuit in March, claiming Sutter Health uses its market power to control prices and exclude competition.

2. During a press conference in March announcing the antitrust suit, Mr. Becerra alleged Sutter Health had prevented insurance companies from giving customers a choice of lower-cost health plans, set out-of-network prices too high, and prevented access to provider costs and rates that would help customers choose their providers, according to the report.

The AG's office also found the health system managed to evade unrestrained price competition by implementing certain mechanisms in its contracts, including forbidding insurers contracting with its network from disclosing prices Sutter Health negotiated for its services and products, the report states.

3. In the motion to dismiss the AG's lawsuit filed by Sutter Health May 14, obtained by Becker's Hospital Review, the health system asked the court to decline to hear the case, arguing the AG's lawsuit would force the court to interject itself into the industry's already complicated economic and regulatory environment. Sutter Health claimed the antitrust suit aims to impose expensive, unwieldy regulations and "upend Sutter's business model and hobble Sutter's efforts to innovate."

4. Sutter Health's motion also claims the AG's lawsuit favors insurers and increases their negotiating power, and asks the court to strike the AG's request that the court order the health system to arbitrate out-of-network charges with insurers, claiming such an action would violate state law and the health system's constitutional right to contract and due process, according to the report.

5. In a statement to The Sacramento Bee, the state AG's office said, "The California Department of Justice is prepared to litigate our antitrust action against Sutter and look forward to making our case in court."

To access The Sacramento Bee report, click here.

Editor's note: This article was updated at 11 a.m. May 17 to include additional information from Sutter Health.

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