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Hiltzik: Citing COVID, the hospital company reneged on a legal agreement



Hiltzik: Citing COVID, the hospital company reneged on a legal agreement

Here are a few points about the giant Sutter Health hospital chain that cannot be denied.

First, the completion of the landmark reached in December with the California Atty. General Xavier Becerra will hit him in the wallet, difficult, because the deal includes a $ 575 million financial penalty among other expensive features.

Second, the coronavirus crisis has destroyed Sutter’s bottom line – as do many hospitals and other health service chains.

The plaintiff will not renegotiate the settlement agreement.

California Deputy Atty. General Emilio Varanini

Sutter is now trying to exploit the second point to damage the first. He has asked the judge who oversees the settlement to postpone the final approval of the agreement, hinting strongly that he wanted to rewrite the agreed key elements.

Becerra has answered, basically: There are no dice. “The plaintiff will not renegotiate the settlement agreement,” Deputy Atty. General Emilio Varanini told the San Francisco High Court Judge Anne-Christine Massullo at the May 29 hearing.

That is encouraging. The truth is that, although Sutter has no doubt caused a deep financial hit from coronavirus – he said interim financial statements lost nearly $ 1.1 billion in the first three months of this year due to revenue of $ 3.2 billion, and an additional operating loss of $ 360 million during April.

That said, the chain is still sitting in pants-full of money; as of December 30, he said in a financial statement, he had $ 6 billion in cash and liquid investments.

Sutter’s bad mouth provides an ideal opportunity to examine how coronaviruses have affected the finances of our leading hospital company.

This also allows us to review the antipompetitive behavior allegedly carried out by Sutter, which Becerra suggested underlies a huge hoard of money. Here is our bottom line: Becerra must not succumb to the settlement provisions, and Judge Massullo must approve it as stated.

Let’s start with the antitrust case.

Lawsuit 2018 Becerra alleged that Sutter Health, which consists of 24 hospitals and 34 operations centers in Northern California, had exploited its size for years
extract “price rises illegally” from insurance companies, entrepreneurs and patients. The lawsuit was built based on cases filed earlier by the Food and Commercial Workers Union.

Among the practices challenged, Becerra pointed to an “all or nothing” rule that Sutter began to apply in his contract with the health plan in 2002. Under this rule, Sutter would not allow any hospital to be excluded by the health plan. from their tissues, or even lowered to a lower level which allows patients to choose them at higher co-pays.

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This poses a dilemma for payers, because many Sutter hospitals are “must-have” institutions for insurance companies or their clients, whether because they are highly valued by patients because of their reputation, or the only hospitals that are suitable in certain geographical areas.

But these restrictions prevent insurance companies or employers from directing patients to low-cost hospitals, either by placing high-cost institutions outside the network or charging higher additional fees.

Sutter said that insurance companies are free to remove their hospitals from their network on request. But the insurance company testified that Sutter put the conditions of the sentence as an exception so that the insurance company had no practical choice. The lawsuit further alleges that the chain imposed arbitration and confidentiality requirements in its contract which effectively maintained its confidentiality.

The whole arrangement, Becerra alleged, was a huge pricing scheme that “hurt the general economy of Northern California and thus the state.” The price of hospitalization at Sutter Health homes is as much as 70% higher than in the much more competitive Southern California area, he said.

The California hospital chain not only raises prices faster than inflation, but gives competitors room to raise their own prices.


That conclusion is supported by academic research and a finding by the Federal Trade Commission. Sutter may not be the only hospital provider in the region, but it does signal that other service providers are aiming for him. “These people set the price of an umbrella, and everyone floats,” Glenn Melnick, a health expert at USC, told me after Becerra filed a lawsuit.

Like expensive Becerra settlement was announced December 20 appeared for Sutter Health, it was something that was mutually beneficial. Becerra rightly described it as “historic,” given the magnitude of Sutter’s sentence and his agreement to stop the anti-competitive practices he suspected.

On the other hand, Sutter did not have to admit the accusation. That avoids the trial, where further details of his behavior may have been publicly displayed and that limits liability that may have grown to billions for only $ 575 million.

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But the pandemic era came, Sutter has revealed what we call settler remorse.

The settlement agreement still requires the approval of Judge Massullo. The hospital company has asked it to postpone its almost unlimited trial and final decision – as much as 30 days after Governor Gavin Newsom declared an end to the pandemic emergency in California.

Spokesman Sutter Amy Thoma Tan said that the chain “did not object to any aspect of the settlement.” Instead, he told me by email, Sutter “asked to delay initial approval given the extreme disruption to the health care industry caused by COVID-19 and COVID-19’s potential to materially influence certain settlement requirements.”

Tan pointed me to “a very expensive and challenging effort” to adjust its operations to the post-coronavirus reality “which will significantly impact us in the coming years.”

All that is true, as far as it goes. But this is not the whole story.

Although Sutter has not explicitly proposed to cancel part of the settlement, he said June 12 court filing that “the financial and operational impacts of the pandemic can … lead to impractical or material impacts” of the agreement.

This includes limiting increases in off-network costs, which “may be too low to cover an unprecedented and unexpected increase in spending to respond to COVID-19.”

Sutter produced statistics showing that outpatient surgery cases dropped 73% in the period from March 17 to April 30, compared to six weeks before March 17. Emergency room visits dropped by 43%, bed days by 23% and clinical visits 60%.

Because the service produced a lot of Sutter’s bread and butter, the chain said it had been forced to close some facilities and reduce working hours for some non-emergency services, which resulted in the reassignment or reduction of hours for more than 5,000 employees.

Becerra’s office does not buy the argument that these conditions guarantee revision of the agreement. In their brief explanation of why Massullo must proceed and agreeing to the agreement, Varanini and Richard Grossman, a lawyer for trade unions, observed that while the COVID-19 crisis had changed the healthcare landscape, it had not changed “the need for commercial insurance companies and Sutter to negotiate agreements” or change “antitrust concerns that the basis “that motivates a lawsuit.

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If the long-term conditions finally show that some of the conditions are too strict, it can be taken based on the provisions that allow for a revised settlement – later. Meanwhile, any delay allows Sutter to continue the behavior that allegedly raised prices in the first place.

As for Sutter’s financial suffering, his claim is worth observing.

To begin, there is no guarantee that the reduction in health care requests cited by Sutter will last long. The company recognizes that many of the reductions in business result from residential stay orders or health problems that keep patients from visiting hospitals and clinics for elective surgery or non-emergency care.

The end of the crisis might bring about a revival of these visits. Sutter has helped a lot in directing the crisis. He received more than $ 200 million in federal aid pandemic funds until mid-May, as well as a $ 1 billion federal advance in Medicare to deal with the pandemic hump.

The latter must be repaid, but the government has indicated that it will give hospitals up to one year to do so.

As for the $ 1.1 billion loss, around $ 500 million consisted of unrealized losses caused by a fall in the investment market earlier this year. But the market has returned strongly since its lowest point in late March – the Standard & Poor’s 500 index has gained 40% since the slump, and on Tuesday showed a loss for the year of less than 4%.

In such circumstances, Sutter Health does not have a business including investment losses in all of its financial claims.

Judge Massullo has set July 9 for a hearing about Sutter’s request to delay approval of the settlement. He may choose to do so because holding further hearings in the settlement itself may be complicated by ongoing emergencies.

But one would hope that he would carefully consider Sutter’s argument that the world had changed so drastically and permanently that parts of the agreement needed to be abolished – or whether it used the crisis as an excuse to break the agreement signed by only six people. last month.

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Portuguese historical films will premiere on 29 December.



Portuguese historical films will premiere on 29 December.

Method Media Bermuda will present the documentary FABRIC: Portuguese History in Bermuda on Thursday, December 29 at the Underwater Research Institute of Bermuda.

A spokesperson said: “Method Media is proud to bring Bermuda Fabric: Portugal History to Bermuda for its 5th and 6th showing at the Bermuda Underwater Observatory. In November and December 2019, Cloth: A Portuguese Story in Bermuda had four sold-out screenings. Now that Bermuda has reopened after the pandemic, it’s time to bring the film back for at least two screenings.

“There are tickets For $ 20 – sessions at 15:30 and 18:00. Both screenings will be followed by a short Q&A session.

Director and producer Milton Raboso says, “FABRIC is a definitive account of the Portuguese community in Bermuda and its 151 years of history, but it also places Bermuda, Acors and Portugal in the world history and the events that have fueled those 151 years.

“It took more than 10 years to implement FABRIC. The film was supported by the Minister of Culture, the Government of the Azores and private donors.

Bermuda Media Method [MMB] Created in 2011 by producer Milton Raposo. MMB has created content for a wide range of clients: Bermuda’s new hospital renovation, reinsurance, travel campaigns, international sports and more. MMB pays special attention to artistic, cultural and historical content.

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Maestro de Braga is the first Portuguese in the National Symphony Orchestra of Cuba.



Maestro de Braga is the first Portuguese in the National Symphony Orchestra of Cuba.

Maestro Filipe Cunha, Artistic Director of the Philharmonic Orchestra of Braga, has been invited to conduct the Cuban National Symphony Orchestra, as announced today.

According to a statement sent by O MINHO, “he will be the first Portuguese conductor to conduct this orchestra in its entire history.”

In addition to this orchestra, the maestro will also work with the Lyceo Mozarteum de la Habana Symphony Orchestra.

The concerts will take place on 4 and 12 March 2023 at the National Theater of Cuba in Havana.

In the words of the maestro, quoted in the statement, “these will be very beautiful concerts with difficult but very complex pieces” and therefore he feels “very motivated”.

From the very beginning, Rachmaninoff’s Piano Concerto No. 2 will be performed by an Italian pianist (Luigi Borzillo), whom the maestro wants to bring to Portugal later this year. In the same concert, Mendelshon’s First Symphony will be performed.

Then, at the second concert, in the company of the Mexican clarinetist Angel Zedillo, he will perform the Louis Sfora Concerto No. 2. In this concert, the maestro also conducts Tchaikovsky’s Fifth Symphony.

“This is an international recognition of my work. An invitation that I accept with humility and great responsibility. I was surprised to learn that I would be the first Portuguese member of the Cuban National Symphony Orchestra. This is a very great honor,” the maestro said in a statement.

“I take with me the name of the city of Braga and Portugal with all the responsibility that goes with it, and I hope to do a good job there, leaving a good image and putting on great concerts. These will be very special concerts because, in addition to performing pieces that I love, especially Rachmaninov and Tchaikovsky, I will be directing two wonderful soloists who are also my friends. It will be very beautiful,” concludes Filipe Cunha.

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