Judge in Sutter Health lawsuit OKs new monitor selection plan


The judge in the antitrust lawsuit against Sutter Health green-lighted a revised plan Monday for picking a monitor to oversee the health system’s compliance with price controls and other terms of its settlement.

Sacramento, Calif.-based Sutter and California’s Attorney General, a plaintiff in the case, now have until March 2021 to find the right person for the crucial job, which could last up to 13 years. San Francisco Superior Court Judge Anne-Christine Massullo rejected the parties’ initial monitor proposal because they had only interviewed white male candidates, and directed them to come up with a new plan.

At a hearing on Monday, Massullo said the new monitor selection plan should reach a larger pool of applicants.

“I think this is a robust process you’ve outlined to reach out to as many entities as possible in the selection of a monitor,” she said. “Thank you for reading my order and following it.”

Under the new plan, the plaintiffs will publicly post a request for proposals on the California Attorney General’s website and circulate it to a broad range of constituencies aimed at reaching out to a diverse pool of monitor candidates. The parties said they’ll specifically target affinity group bar associations. Applicants will have up to 45 days to submit proposals.

The plan calls for interviewing six candidates initially and narrowing that to two during a second round of interviews. The most weight will be given to three key qualifications: experience with healthcare and managed care contracting, representation of healthcare providers and/or insurers and knowledge of California and federal antitrust and healthcare law.

In their plan, the parties said they believe an “inclusive, efficient, transparent and thorough search process can be accomplished in approximately 3 months.”

The parties now have until March 1, 2021 to submit their new monitor pick, with a preliminary approval hearing scheduled for March 9.

The case, initially filed in 2014, revolves around claims that not-for-profit Sutter is driving up healthcare prices in Northern California through illegal, anticompetitive business practices, which the health system denies.

Terms of a settlement announced in October 2019 include limits on how much Sutter can charge out-of-network insurers. Insurers, employers and self-funded plans also will no longer have to include all of Sutter’s hospitals, clinics or other commercial products in their plans’ networks, among others.

None of those rules take effect, however, until Massullo approves the final settlement. Court records show Sutter has declined to abide by the terms in advance of that approval.

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