Chicago Hospital Settles Class Action for $55M

Evanston, ILNorthShore University Health System has agreed to pay $55 million to settle a federal consumer class action lawsuit that was filed back in 2007. The settlement ends 16 years of litigation over its merger with another hospital that allegedly allowed NorthShore to illegally monopolize the market and unfairly raise prices on patients.

NorthShore Class Action Timeline

2000: Evanston and Glenbrook hospitals acquired Highland Park Hospital and formed NorthShore University HealthSystem, now called Endeavor Health.

2004: An administrative law judge and the Federal Trade Commission ruled that the merger was anticompetitive and violated federal antitrust law. The FTC order said the merger of NorthShore — then known as Evanston Northwestern Healthcare Corporation — with Highland Park Hospital violated antitrust law. In its case, the FTC required NorthShore to establish separate negotiating teams at both Evanston and Highland Park hospitals for inpatient and outpatient services.

2005: An administrative law judge found that ENH’s acquisition of Highland Park Hospital was anticompetitive and violated federal antitrust law.

2007: The Federal Trade Commission affirmed the 2005 ruling and issued an order to restore competition lost in Evanston Northwestern Healthcare Corporation (ENH)

Aug. 2007: A lawsuit filed by individuals who paid for inpatient or outpatient services from NorthShore claimed they paid more for inpatient hospital services than they should have. The lawsuit alleged the hospital had abused its market power and charges inflated prices in a way that is illegal under antitrust laws.

2008: U.S. District Judge Joan Lefko denied NorthShore's motion to dismiss the lawsuit. Plaintiffs filed a consolidated Class Action complaint against Evanston Northwestern Healthcare Corporation (ENH) “on behalf of all end-payors who purchased inpatient and hospital-based outpatient healthcare services directly from ENH, its wholly owned hospitals, predecessors, successors, or controlled subsidiaries and affiliates from at least as early as January 1, 2000.”

2010: Lefko sided with the hospital group but she relied on an unreliable NorthShore witness to deny class action status to the plaintiffs, according a filing from their lead attorney.

2012: Lefko's order was reversed by the 7th Circuit Court of Appeals, the class was reinstated and the case was reassigned to Judge Edmond Chan.

2013: Chang granted class certification.

2023: Chang issued an order that allowed the suit to continue and set the stage for a jury trial.

Dec. 2023: An all-cash settlement was finalized ahead of a January trial, whereby NorthShore maintains that it did nothing wrong and denies liability.

Jan. 2024: Reuters reported the pending settlement agreement.

The $55 million settlement amount, which is sitting in an escrow account deposited by NorthShore, provides plaintiffs with cash in exchange for the litigation being dropped. It will  be distributed proportionally to the plaintiffs after deducting legal fees and other related costs. According to the Chicago SunTimes, “The resolution of this matter allows us to continue focusing on providing exceptional care,” Endeavor Health said in an emailed statement. And the plaintiffs’ attorney wrote “The settlement is the result of 16 years of very contested litigation and extensive arm’s-length negotiations”.

According to Notice and Claims Administrator retained and supervised by Lead Counsel for the case In re: NorthShore University HealthSystem Antitrust Litigation, No. 1:07-cv-04446:

Generally, you are included in the Settlement if you are in the United States or Puerto Rico and paid for inpatient hospital services directly from NorthShore (formerly called ENH), from February 10, 2000 to December 31, 2015. You may have seen a previous notice that stated purchasers of outpatient hospital services were included in the Class. The Class has changed to include only those who purchased inpatient hospital services. Some members of the original class are not members of the current Class. Additional information, including the full class definition and who is not included, is available in the Settlement Agreement.

Those ineligible for compensation from the settlement are patients who paid fixed co-pays, Medicare or Medicaid users, uninsured patients with unpaid bills, and anyone related to NorthShore employees.