Blue Shield of California and Sutter Health May End Contract Agreement


Blue Shield of California and Sutter Health network are struggling to reach a contract agreement. Blue Shield is in the process of warning approximately 280,000 customers that they should search for health care providers outside of the Sutter Health system. If a contract agreement is not settled, Blue Shield policyholders would have to pay higher out-of-network rates to stay.

The main issue in the contract is money. Sutter Health claims that Blue Shield wants to reduce payments for health services by too much. On the other hand, Blue Shield alleges that Sutter Health charges 18 to 30% more than other providers. Blue Shield is also against the mandatory arbitration clause that Sutter Health wants in the contract that would prevent Blue Shield and self-insured companies from suing in open court.

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