Highmark – UPMC Extend In-Network Deal

Dec 22, 2011

Highmark and UPMC announced today that the two nonprofits have reached a deal to allow Highmark subscribers continued access to UPMC hospitals and physicians at in-network rates until June 30, 2013.

Such access was to expire in 2012 as the terms of a deal between Highmark and UPMC expired. Highmark, the largest health insurer in western Pennsylvania, and UPMC, the largest health care provider in the region, are locked in a bitter fight over rates and access to facilities.

A statement issued jointly said in part, "The additional time period will provide certainty for UPMC patients and Highmark subscribers. Discussion sessions have taken place with the assistance of Governor Corbett and via third party mediation."

Highmark officials added, "Highmark will continue to work toward achieving a long-term contract with UPMC that guarantees our members affordable access to all UPMC hospitals and physicians and preserves provider choice."

UPMC added, "This date certain provides 18 months for UPMC patients and Highmark subscribers to review the multiple competitive health insurance options now available to assure that their care will continue uninterrupted with UPMC physicians and hospitals. It also allows the regulatory agencies time to review Highmark's proposal to acquire West Penn Allegheny."

The announcement that Highmark was purchasing the hospital system ratcheted up the rancor between UPMC and Highmark.

UPMC's statement went on to say, "We are grateful to the Governor and his mediators for conducting an informed and constructive process with patient care and access the highest priority. UPMC remains focused on meeting the needs of our patients while Highmark can now focus on completing its acquisition of West Penn Allegheny."

State Sen. Jim Ferlo (D-Pittsburgh) said public protest and action in the state legislature created an environment where the governor's office needed to get involved. "The weight and stature of [the governor's] office is critical to bringing about some temporary relief," said Ferlo who cautioned that if the public and lawmakers do not keep the pressure on, they could find themselves back in the same place a year from now.

Ferlo said he would push for "Certificate of Need" legislation that would force UPMC and Highmark to get approval for any major capital improvement projects. "We may get through this dark period of bitter divorce only to find that we have created two very large behemoth[s]… that have control of physicians, facilities, as well as the insurance product, and we could still see exorbitant increase in our health care dollar."

State Rep. Dan Frankel (D-Pittsburgh) is praising the agreement as a "baby step in the right direction" and is calling on the PA Senate to pass HB 252 that would force binding arbitration if the two nonprofits cannot come to an agreement in the future.

"We are not going to sit idly by while these two entities potentially disenfranchise millions of western Pennsylvanians from their doctors and their hospitals," said Frankel.