U.S.|How a Health Care Trial Could Have a Chilling Effect
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Sutter Health, a sprawling system of 24 hospitals and 5,500 affiliated doctors, faces trial in San Francisco today over accusations that it used its dominance in Northern California to stifle competition and force patients to pay higher medical bills.
Our colleagueReed Abelson, who covers the business of health care, explains the significance of the case. (Read the full storyhere.)
You can expect the courtroom to be standing room only for the Sutter antitrust trial. The case is being brought by the state’s attorney general, Xavier Becerra, along with employers and unions that say they have been harmed by Sutter’s actions.
Because Sutter is able to force health plans to include all of its hospitals and doctors in their networks, patients can’t go elsewhere for care that is cheaper or better quality, Mr. Becerra said. He describes Sutter as showing signs of being a “bully.”
Sutter’s critics say this leads to much higher prices in Northern California for medical care than in the southern part of the state. Hospital care for a heart attack costs around $25,000 in San Francisco, according to research by the Petris Center at the University of California at Berkeley. It’s closer to $15,000 in parts of Los Angeles.
Sutter says that its big system benefits patients and that it does not engage in any behavior that would hurt competition in the market. It says the big insurance companies support the case because they want to limit patients’ choice and increase their own profits.
There’s a lot at stake: Sutter could be liable for more than $2 billion under state law, which can treble the amount of damages awarded.
But other big systems, many of which employ similar tactics to prevent insurers from steering patients to other places, are also paying attention to what happens in court. The wave of mergers and acquisitions of physician practices across the country has left many markets with a dominant hospital.
If the case doesn’t go in Sutter’s favor, you can expect other big systems to start worrying about their own behavior in making sure insurers don’t send patients outside their hospitals and medical groups. As Leemore Dafny, a former antitrust official and Harvard business professor, said: “It could have a chilling effect on these practices nationwide.”
- A deadline for wildfire victims to file claims is less than three weeks away. As many as 70,000 Californians who suffered losses linked to PG&E’s equipment could be left out. [The New York Times]
- Four people were injured after a series of electrical explosions at an Oktoberfest event in Huntington Beach on Saturday. [Long Beach Press-Telegram]
- A senior Border Patrol agent from El Centro was arrested and charged with sexually assaulting a female colleague. The case, now in pretrial hearings in Tucson, is at the center of a#MeToo moment for the nation’s border-security force. [The New York Times]
- A Marin County lawsuit may test the constitutionality of inclusionary zoning, which local jurisdictions rely on to expand the supply of affordable housing. [CityLab]
- How far will California take criminal-justice reform? [The New Yorker]
- A magnitude-3.9 earthquake struck the Bay Area on Saturday morning. Here’s a refresher on what you need for an earthquake preparedness kit. [Curbed SF]
- In memoriam: Diahann Carroll, 84, who transcended racial barriers on “Julia,” the first U.S. TV series about a black professional woman. [The New York Times]
- She joined Elsinore High School’s football team two years ago. During halftime, she was crowned homecoming queen. [The Press-Enterprise]
- Otis the pug was stolen from his home in San Francisco. Then Otis was found. A homeless man refused the $15,000 reward — because he had found much more than a pug. [Mission Local]
Coming up this week
- San Francisco Fleet Week runs through next Monday.
- Beck and Rage Against the Machine are headlining at the 20th anniversary of the first Coachella Valley Music and Arts Festival on Wednesday.
- Former Vice President Joseph R. Biden Jr. is campaigning in California this week, with a stop in Los Angeles on Thursday.
- L.A. Comic Con kicks off on Friday.
And finally …
She sent dispatches from the front lines of ’70s-era West Coast bohemia, satirizing the incestuous music and art worlds in Los Angeles. Eve Babitz was known for being Hollywood royalty, and she seemed to be having more fun than Joan Didion.
Ms. Babitz faded from public view after a 1997 accident that led to her becoming a recluse and a misanthrope. She may not have received her professional due, but there has been a steady renaissance of her work in the last decade, as a new generation of women finds solace in her words.
And now New York Review Book Classics is publishing a collection of her magazine articles. “I Used to Be Charming: The Rest of Eve Babitz” is out tomorrow.
Read the full story here.
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California Today is edited by Julie Bloom, who grew up in Los Angeles and graduated from U.C. Berkeley.