The settlement resolves two antitrust lawsuits involving a dispute over Sutter Health’s approach to contracting with insurance companies as an integrated system. The first is a class action lawsuit brought in 2014 on behalf of various group health plans that provide for employees’ and members’ health insurance, known as self-funded payers. The second is a lawsuit brought by the California Attorney General in 2018.

The settlement agreement outlines particular guidelines for contracting between Sutter Health and insurance companies. Sutter was able to resolve this matter in a way that enables the organization to maintain its integrated network and ability to provide patients access to affordable, high-quality care.

There were no claims that Sutter Health’s contracting practices with insurance companies affected patient care or quality. In fact, our commitment to quality yields better health outcomes and a lower total cost of care for some 3 million patients in the communities we serve. Sutter’s quality of care is nationally recognized, with the majority of hospitals and care facilities outperforming state and national averages in nearly every measure of quality.

The settlement provides two kinds of relief: monetary and injunctive. Class members will receive the monetary relief, and the injunctive relief outlines how we will contract with insurance plans moving forward.

• Injunctive relief: The settlement agreement provides self-funded payers with additional network flexibility, while preserving Sutter’s ability to ensure that certain insurance networks, when they include Sutter providers, are fair to patients in terms of access to Sutter doctors and hospitals, and to minimize the risk of unforeseen patient costs.   
• Monetary relief: California-based self-funded group health plans who are class members will receive financial payments with amounts determined by the plaintiffs and subject to a plan of allocation to be approved by the court. An independent claims administrator is responsible for all claims administration and providing information to settlement class members.

The agreement outlines particular guidelines for contracting between Sutter and insurance companies. It does not dictate which providers your insurance company should include in its network or determine or decide which insurance plans your employer may offer.

Sutter is fully implementing these terms in accordance with the timing set forth in the Court’s Order.

This is a dispute about how Sutter contracts with insurance companies and the terms of the settlement do not directly impact patients. Sutter will continue to do all we can to prevent situations where patients are caught in the middle of disputes with insurance companies or receive surprise bills. We were able to resolve this matter in a way that enables Sutter Health to maintain our integrated network while avoiding a lengthy and costly trial.

There are two parts to the agreement—the first is the injunctive relief, which outlines guidelines for how Sutter Health will contract with insurance companies. This will change how Sutter Health contracts with self-funded health plans in certain instances.

The second part of the agreement involves monetary relief. Sutter Health agreed to resolve the case and fund a settlement that would enable us to maintain the stability of our integrated network of care. 

The settlement became effective upon the Court’s final approval of the agreement on August 27, 2021.

Proceeds are distributed to self-funded group health plan class members in amounts determined by the plaintiffs and an allocation plan approved by the court. An independent claims administrator is responsible for all claims administration and providing information to settlement class members.