Tue. Apr 23rd, 2024



In a last ditch effort to force regionalization, Sutter Health met with CalPers (California Public Employees’ Retirement System), and Anthem Blue Cross to make a “deal” with CalPERS members and employees. In a letter received by CalPERS members:

“CalPERS  has approved of a new ANTHEM BLUE CROSS EXCLUSIVE PROVIDER ORGANIZATION (EPO) in Del Norte County.  Anthem and CalPERS collaborated with Sutter Health to develop a network of providers in your community. The new plan will be available April 1, 2015 IF MEMBERS CHOSE TO ENROLL in the plan.”

Sutter Health goes on to explain, “ANTHEM BLUE CROSS DEL NORTE COUNTY EPO, features $15.00 co-pay and no-out-of –pocket cost for hospitalization and access to online health management resources.” Notice the “online health management resources.”

What this plan fails to tell you is in the event you are diagnosed with cancer, you will not be able to utilize the oncologist in Medford. Instead, you will have to drive to the nearest SUTTER HEALTH facility down south in order to get treated. This information came from our CalPERS representative in Southern California, who was scratching her head on why we are being offered this state of madness.


Let’s look at the timeline.


Nov 3, 2011:  The Sutter Coast Hospital Board of Directors votes to dissolve themselves as the governing body of the hospital, and transfer ownership to Sutter Health, after purposely EXCLUDING THE PUBLIC AND THE HOSPITAL PHYSICIANS  from the decision.  Hospital Chief of Staff, Kevin Caldwell, M.D.,  casts the only vote against “Regionalization,” asking the board for time to study the issue. It should be noted that local, Kevin Hartwick, was on the Board of Directors at that time.

May 21, 2013: Sutter Coast CEO, Linda Horn, issues a press release confirming that a study on options for Sutter Coast Hospital will be conducted.  The study, entirely funded by Sutter, MANDATES THE STUDY OF POSSIBLE CRITICAL ACCESS DESIGNATION FOR SUTTER COAST HOSPITAL.

May 28, 2013: Sutter Coast,  CEO Linda Horn, states twice to the Board of Supervisors that “Critical Access is not being discussed.” Supervisors David Finigan and Roger Gitlan ask Sutter CEO Linda Horn to release the internal documents which the public needs to verify Sutter’s claims of financial losses. Sutter Health refuses to release any documents, including those requested in the discovery phase of litigation filed by Del Norte Healthcare District.

June 24, 2013: Hospital study begins in Crescent City. All members of the 15 person “steering Committee” on the study, which includes two elected officials acting as individuals, are required to sign confidentiality agreements in order to participate in the study.

July 23, 2013: Former County Supervisor Mike Sullivan writes the following editorial; “Anything less than full disclosure of records, data and information required to clearly outline the issues and decisions is a failure on the part of Sutter Health and demonstrates the complete lack of responsibility toward our community.”

December 5, 2013: Board of Directors of Sutter Coast Hospital votes to change the designation of Sutter Coast from an Acute Care Hospital to a Critical Access hospital. This will require a 50% reduction in acute care hospital beds, and limit the average hospital to stay to four days or less. The current requirements of emergency room physician on duty at all hours, and a general surgeon and intensive care specialist available, disappear under the Critical Access designation. A consultant hired by Sutter Health to study the impact of Critical Access estimated that 247 patients per year  would require TRANSFER OUT OF CRESCENT CITY, DUE TO THE  25 BED CAP LIMIT UNDER CRITICAL CARE ACCESS DESIGNATION.


California Valued Trust (CVT):  Recently, CVT received noification that Sutter Health Systems has notified Anthem Blue Cross of their intent to terminate their arrangement with Anthem effective January 1, 2014. Discussions continue and our goal is to help ensure Anthem and Sutter reach a mutually agreeable terms that are most beneficial to CVT membership.


In a high-stakes fight over healthcare costs, insurance giant Blue Shield of California contends thast a major hospital chain is trying to hide some of its business practices from public scrutiny. The dispute has prevented Blue Shield and Sutter Health, which runs 23 hospitals in Northern California, from reaching a new contract6 that could affect numertous employers and consumers. Their previous agreement expired December 31.

Blue Shield said state regulators were notified and it’s informing about 280,000 helath plan members that they might lose network coverage with Sutter doctors and hospitals.

Health plans and hospital systems frequently bicker over rates and a temporary impasse can be part of the negotiations. But Sutter has already drawn attention for its high prices and market power.

California Attorney General Kamala D. Harris has been investigating the conduct of Sutter and other big hospital chains and whether their market clout has harmed consumers. Last year, a Union Trust6 representing more than 60,000 grocery workers and dependents sued Sutter in State court, accusing it of imposing anticompetitive terms and “illegally inflated prices.”

Blue Shield has taken a similar stance against Sutter, saying its prices are up to 30% higher than other hospitals. The San Francisco insurer said Sutter is insisiting on mandatory arbitration for all disputes. Such a policy would block the health plan and employers from suing Sutter for anticompetitive practices in open court, Blue Shield said.

“Sutter has a long history of driving up the cost of healthcare,” said Blue Shield spokesman Steve Shivinsky. “Now they are seeking new contract terms that would insulate them from any potential litigation.”


Anthem  has shared information with CVT regarding challenges in the negotiations with Sutter Health Systems that may impact our members. Several key challenges are:


Sutter’s Contract contains provisions which prohibit the disclosure of meaningful cost data/information to Anthems members. Access to cost and quality information is neeed for members to actively make informed decisions about their personal health and well being.


Sutter Hospital rates are roughly 60% higher than the average of other hospitals throughout the state. Sutter Hosptials represent 7 of the top 10 most expensive general acute care hospitals in California.

Sutter Profits:

Anthems current reimbursement rates over Sutter’s costs, and on average, allow for more than 50% profit margin.

Now on top of being much more expensive than other networks providers, Sutter has demanded that the overcharges not only be continued, but that they be allowed to charge even more and in so doing continue to waste millions more of your benefit dollars each year. This waste is difficult to accept when other high quality equivalent  treatments are available nearby.

In April, the United Food and Commercial Workers and its Employees  Benefit Trust sued Sutter in San Francisco Superior Court. The suit said Sutter’s hospital prices in San Francisco have exceeded those of competitors by as much as 56%. It also said an overnight hospital stay at Sutter Hospital in San Francisco or Sacramento cost at least 38%  more than a comparable stay in the more competitive Los Angeles market.  “Sutter’s illegal conduct has resulted in inflated prices that far exceed the prices its hospitals could charge in a free, competitive market, “ the union trust said in it’s complaint”.

Last but not least Sutter Coast Hospital is EXEMPT FROM INCOME TAX. FILED BY Shannon Deforest on 10/19/12  from the Ernst &Young U.S. LLP.



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