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Sutter Health Palo Alto Medical Foundation facilities. health tech coverage from STAT — Adobe

When Sutter Health was on trial for anticompetitive conduct in 2022, the San Francisco jury missed out on some crucial details. They didn’t hear, for example, how its former finance chief said the system would make an extra $200 million per year by making insurers contract with all of its hospitals instead of just a few. Or how its former CEO said, “Related to the health plans, we force them to pay us more.”

That evidence was indeed relevant, and the judge erred by not allowing it to be presented during the month-long trial that concluded in March 2022, a U.S. appeals court wrote in its ruling on Tuesday. The Ninth Circuit panel overturned Sutter’s win in the class-action case alleging that Sutter used its market power to drive up health care costs across the region by more than $400 million. Tuesday’s decision means the case will likely get a second trial.

“Effectively, the appellate court said the jury was tainted,” said Matthew Cantor, lead counsel for the plaintiffs. “So the jury’s verdict is discarded.”

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