The state’s antitrust lawsuit against Sutter Health is a welcome move to stop Sutter from inflating health care costs across the Northern California market.
The lawsuit alleges that Sutter has illegally used its market power to compel commercial health plans to contract with all or none of its hospitals, extract exorbitant prices and prohibit use of financial incentives to encourage use of lower-cost providers.
The problem is not just Sutter, however, but insurance-contracted provider networks (preferred provider organizations and health maintenance organizations), where insurers negotiate medical service prices, keep those prices hidden and make other private deals that maximize revenue at purchaser and consumer expense.
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