April 07, 2014

United Food and Commercial Workers' benefit trust on Monday hit Sutter Health with a putative class action in San Francisco court alleging the health system had overcharged millions of workers through illegal anti-competitive behavior that forces health plans to use its overpriced hospitals.

Sutter, the largest health care provider in northern California with at least 27 hospitals, is already facing a putative class action on behalf of consumers in California federal court, but the UFCW and Employers Benefit Trust's suit filed Monday seeks to represent benefit trusts and employers that pay health care providers out of their own funds. The UEBT has over 60,000 enrollees in its self-funded health plans, according to the complaint.

The UEBT alleges that Sutter imposes contract terms on health plan providers that punish them with higher prices for substituting competing hospitals in their network, requiring them to include Sutter hospitals instead, even though they charge as much as 56 percent more for services, according to the complaint.

The full article can be read here.