Sutter Health Case Analysis

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Sutter Health Case Analysis
California Sutter Health is a not-for-profit health system that serves many patients and the families of over 100 Northern California cities and towns. They have grown from a small independent health care facility in Sacramento to one of the largest health care providers today. Due to the increase in costs and the inability to collect payments, there have been many financial rollercoaster rides with the budgeting and patient collections. As a result, they have been working on transforming and redesigning all of their management and account processes and approaches while striving to keep the health care consistently affordable for their patients. Sutter Health is making progress to conserve all limited resources as well as finding better and more efficient resources to serve the community and succeed financially. Sutter Health “started out as independent health care providers, but forces like rising costs and declining payment for services have made it difficult for hospitals and physicians to continue operating on their own. Just in the last decade, more than 100 Northern California hospitals have had to close their doors, and the majority of state's physician groups are facing significant problems as well… While Sutter Health as it is today was created through the January 1996 merger of Sacramento-based Sutter Health and Bay Area-based California Healthcare System, the foundation of Sutter Health began taking shape well over 100 years ago, as independent hospitals opened to meet the health care needs of their local communities” ( In 2009, Sutter Health’s facilities and services were internally organized into five geographic regions which are Sutter Health Central Valley Region, Sutter Health East Bay Region, Sutter Health Peninsula Coastal Region, Sutter Health Sacramento Sierra Region, and Sutter Health West Bay Region. They are still expanding to this day. Although Sutter Health has been committed to keeping the affordable rates, there have been some accusations and class action lawsuits related to billing the uninsured patients. A lawsuit was initiated by a group of uninsured patients stating that they were outrageously over charged compared to the prices from the commercially insured. “In March 2006, Sutter Health adopted a new policy for all of its affiliated hospitals that provides for those facilities to offer automatic discounts to uninsured patients that are comparable to the negotiated discounts that the hospitals provide to private insurance companies. Under the terms of the settlement, Sutter's hospitals will continue to abide by this new policy for at least three more years. Sutter Health plans to maintain the policy indefinitely” ( They also sent notices to all the patients involved in the lawsuit backdated to 2000 stating they would be eligible for their bills to be recalculated with the new policy. Now, regardless of their financial status, uninsured patients will never receive a bill containing full charges. Sutter Health has been very committed to serving their patients with the best quality care while trying to keep the cost at a consistently affordable price. Sutter Health doctors and hospitals participate in voluntary and mandatory programs that publicly report patient satisfaction, cost, utilization and quality of care measures. These reports help keep the company up to standards if not exceeded these standards. As stated on the company website, “Sutter hospitals perform in the top 10 percent on national quality indicators measured by the Centers for Medicare and Medicaid Services.” Sutter Health has been improving their services towards their patients by reviewing their annual reports as well to see where they can cut back. With doing this they noticed a few issues with patient balances and wanted to try and fix this problem. When looking at all hospitals they found that many patient accounts were not being paid off on time or at...
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