In mid-March 2026, Sutter Health and Allina Health announced the signing of a Letter of Intent to merge the healthcare systems.  Sacramento-based Sutter Health has more than 600 locations and 27 hospitals, and reported $19.8 billion in total revenue and $509 million in operating income in 2025.  Sutter Health has come under fire in recent years with claims that it has improperly used its market power to impose anticompetitive contract terms, restricting competition and driving up the cost of care.  Minneapolis-based Allina Health has 12 hospitals and 100 additional care sites in Minnesota and western Wisconsin, and reported $6 billion in revenue and an operating loss of $95.4 million in 2025.  The merger would create a combined $26 billion, 39-hospital system with locations in California, Minnesota, and Wisconsin, and would have more than 400 care sites and 88,000 employees.

In January, Sutter Health announced the appointment of a new executive vice president responsible for out-of-state mergers and joint ventures, underscoring its focus on expansion beyond its traditional California market.

Concerns With Cross-Market Mergers

Research has shown that cross-market mergers (mergers or acquisitions involving systems that do not directly compete in the same geographic market) often lead to price increases and harm competition.  These types of deals allow parties to leverage significant market power against purchasers of health care that span local geographic markets.

The primary tool used by the Department of Justice (DOJ) and Federal Trade Commission (FTC) to determine antitrust concerns is the Herfindahl-Hirschman Index (HHI) (a measure of market concentration used to assess competition), which is applied to the local healthcare market.  Because cross-market mergers do not raise the HHI in any individual market, they often don’t attract the same level of scrutiny as a merger within a single market.

What to Expect

Unions representing Allina healthcare workers have already stated concerns with the merger.  SEIU Healthcare and the Doctors Council noted “concerns about what this means for employees, our contracts and our pension plans” and stated concerns about the potential impact on patient care.  The Minnesota Nurses Association also expressed “serious concerns about how this could impact union members’ contracts and benefits as well as patient care”.  All of these parties called on the Minnesota Attorney General to examine the merger and to comply with state laws regulating healthcare mergers and acquisitions.

Every merger is unique, and there is no reason to assume specific results from this one, but history suggests the situation warrants monitoring.  And while traditional methods of measuring the impact of a merger (such as the HHI) may be insufficient, it is fully expected that both state and federal regulators will review this deal for potential antitrust issues.

The systems intend to close the deal before the end of 2026, assuming no regulatory challenges emerge.