An Open Letter from Pat Fry, President and CEO of Sutter Health

An engaged partner in quality, affordable health care

The national health care reform debate and recent news about health plan insurance premium increases have again shined a spotlight on the complex subject of health care affordability.

Several years ago, we recognized that the significant health plan premium increases for consumers and businesses could not continue and that Sutter Health needed to step up to do our part in making quality health care more affordable. We have made significant progress in delivering our services more efficiently, reducing costs and slowing the rate of cost increases. I am pleased that, through these efforts, we held annual overall commercial health plan contract rate increases to single digits over the past several years. We did this while raising the bar on clinical quality throughout our system and investing billions of dollars to build and replace physician care centers and hospitals.

Our Quality

Our dedicated doctors, nurses and other health care professionals helped Sutter Health achieve top status as California’s leading health care system in quality. I’m proud that Sutter-affiliated physician groups rank among the state’s top medical groups, and that many of our hospitals received certificates of excellence from the California Healthcare Foundation.

Our Commitments

Sutter Health needs to achieve and maintain a system operating margin of at least five percent each year to have sufficient funds to build and replace facilities and purchase the equipment and technology that our patients expect and deserve. We are Northern California’s leading provider of MediCal services, have one of the nation’s most liberal and generous charity care policies, have invested in new lifesaving technology and electronic health records, and we’re expected to generate billions of dollars in revenue to meet California’s seismic requirements. From 2000 through 2009, Sutter Health invested more than $6 billion to build and replace hospitals and add other new points of access for patients – quite an impressive track record of community investment and service.

Our Efficient, High-Quality Approach to Health Care

Sutter Health also has an obligation to ensure adequate access to physicians. Doctors are a critical part of our integrated health care network and we wouldn’t be the health care network we are today without them.

Our coordinated delivery model, where doctors, hospitals and other health care providers work together to care for patients, helps ensure coordinated care and compliance with medications, improve quality, reduce costly and unnecessary duplication, and provides seamless access and treatment for patients. When looking at health care cost, it’s important to look at it from this perspective — what it costs to provide the total care for a patient or a population over time versus what it costs for an X-ray or a day in the ICU.

An independent study released in 2006 by John Wennberg, M.D., director of Dartmouth Medical School’s Center for the Evaluative Clinical Sciences, examined this very perspective. It found that doctors and hospitals in Sutter Health's Sacramento Sierra region provided among the nation’s most efficient and consistent quality care. The study declared the region’s level of care a national benchmark along with the Mayo Clinic in Minnesota and Intermountain Healthcare in Utah.

Our network’s coordinated and thoughtful approach to caring for patients, along with a continuing commitment to reducing costs, are fundamental to the reform of our national health care system.

It’s also important to recognize that health insurance premiums in California remain at or below the national average despite the high cost of living and caring for patients in many parts of our state. Still we know much more work must be done, and we will continue to be engaged participants and leaders in efforts to provide the highest quality health care at an affordable price