New Questions Raised Concerning UPMC, Highmark Agreement

Lawmakers have questions about the transition agreement Pittsburgh-based UPMC and health insurer Highmark entered into, just two weeks after Pennsylvania Governor Tom Corbett announced the two had reached a pact, according to a Pittsburgh Business Times report.

In 2011, Highmark, the largest insurer in Pennsylvania, announced it would acquire bankrupt West Penn Allegheny Health System — one of UPMC's largest competitors — in an attempt to maintain the viability of a lower-cost competitor to UPMC.

After the insurer announced the acquisition, UPMC, which operates its own insurance arm, said it would not renew its contract with Highmark, saying the contract would benefit a direct rival.

The contract between the two organizations was set to expire at the end of this year, and if new terms were not agreed upon, more than 1 million Highmark members were set to no long have in-network access to UPMC providers — a concern given UPMC's position as the dominant player in the regional market.

The contract dispute between the two grew to such proportions that the government intervened. Pennsylvania lawmakers drafted legislation that would force UPMC and Highmark to work together. Under the legislation, integrated delivery systems would be required to accept patients covered by "any willing insurer." The bipartisan legislative effort was led by Rep. Jim Christiana (R-Beaver).

In June, Pennsylvania Governor Tom Corbett announced UPMC and Highmark had entered into a five-year transition agreement that would allow Highmark enrollees to be covered by their out-of-network coverage rate, though UPMC services provided outside the greater Pittsburgh area will remain in-network for Highmark customers.

However, it appears Highmark and UPMC did not reach the same understanding concerning the terms of the agreement, as UPMC has sent a message to health insurance brokers and others picking apart Highmark's interpretation of their separation agreement. The message indicated a Highmark advertisement had left out important details of the agreement, according to the Business Times.

While the two organizations are attempting to reach a mutual understanding of the agreement, lawmakers feel more work needs to be done, as essential issues are still left unresolved by the contract. Rep. Tony DeLuca (D-Penn Hills) sent a letter to Gov. Corbett seeking answers. In his letter, Rep. DeLuca noted there were many specialty care, emergency care and continuity of care issues that were far from resolved and that the parties, including Gov. Corbett, should immediately direct their attention to addressing the matters.  

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