UPMC/Highmark dispute (Pittsburgh, Erie, Penn: 2014, health insurance, buying)

[villageidiot1]

UPMC directors pass resolution not to extend Highmark contract after 2014 expiration - Pittsburgh Post-Gazette

What is going to be the end result of this dispute? Highmark has said in a state filing that it needs to shift 41,000 inpatient admissions from UPMC hospitals to its own Allegheny Health Network. UPMC finds this unacceptable and their board chairman states, "Losing 41,000 admissions to the Allegheny Health Network "would be the equivalent of, for example, the closing of UPMC Shadyside and UPMC Mercy and, with it, laying off 11,000 professionals."

I don't think insurance companies (payers) and hospitals (providers) should be allowed to combine under antitrust laws, but I see no other way for the West Penn/Allegheny Health System to survive. Part of the problem here is the lack of ability for most people to change insurance companies because it is tied to employment. People want to stay with a doctor they like but will be unable to do that if they have Highmark/Blue Cross insurance and their doctor is part of the UPMC system.

An earlier version of this article said that Corbett stated he would fix this situation if the parties involved can't. I'm not sure what power he has to fix this. It is similar to the way his lawsuit fixed the Penn State situation.

Most of the replies to this article are very critical of UPMC but they are only protecting their business. I think both health systems need to survive. I think the solution is the consumer needs complete freedom to make their healthcare choices. Competition between the two health systems is good for consumers in the long run but people also need complete flexibility to select their health insurance. Many people do not have the option of switching health insurers since they have to take what their employer provides.

[Bong477]

The only way for the proposed highmark/west penn merger business plan to work is by siphoning a large number of patients off UPMC. They need to increase hospital admissions and Pittsburgh doesn't have a rapidly growing population. UPMC doesn't want Highmark to be able to be able to sell their insurance products as covering UPMC services and then using various methods to steer the patients to their own providers once they already have the business secured in a "bait and switch" type fashion (this is how they explain their position).

The end result is going to be if you have Highmark insurance you won't be able to use UPMC facilities and docs (outside of WPIC and Childrens) certainly at in network rates and possibly at all. Realistically, these days you can't do much at out of network rates without breaking the bank aside from an occasional doctor's office charge. This is assuming the government doesn't force UPMC to change their mind which is always possible but I think its unlikely to happen again.

So if you have highmark insurance and want to keep UPMC docs, start looking for other insurance options including lobbying your employer to reconsider their insurance options. If you can't do that, you'll probably need to find another doctor or pay significantly more out of pocket. Fortunately for people that fall into this situation, the West Penn system (while certainly not as large as UPMC) is pretty robust as well and while you may not be happy about changing docs chances are you will be able to find a decent doctor that does take your insurance who can take care of your problems.

I agree that consumers need more freedom how to select and pay for their healthcare. That doesn't seem to be the direction things are headed though...

[WhoIsStanwix?]

One solution to the localized portion of this issue (ignoring the fact that our national healthcare system is mostly in shambles, anyway):

Highmark has a contract with UPMC
UPMC Health plan has a contract with WPAHS

These contracts may not be favorable to the contract Highmark has with WPAHS or that UPMC has with itself.

UPMC Health Plans and Highmark should both be limited to offering these types of plans:

1. A three tier "narrow network" plan
a. Member has most preferred rates/copays at the "most preferred" facilities. For UPMC that's UPMC, for Highmark, that's WPAHS.
b. They have "less preferred" but still better than out of network copays at the non-affiliated hospital system.
c. Out of network at all other non-contracted facilities/systems

2. A "broad network" plan
a. Member pays preferred copays at both UPMC and WPAHS
b. Member pays out of network at non-contracted systems or doctors

3. A "restricted network" plan
a. Member can only go to UPMC on UPMC Plan or WPAHS on WPAHS plan.


If an employeer offers option 3 as a low cost option, they must also offer either 1 or 2 as a more expensive option to employees so they have choice. There can be many variations of plan design in all three options listed above.


I know that this goes against free-market principles, but so does pretty much the entirety of our healthcare system.

[villageidiot1]

Pittsburgh-UPMC relationship gets new bruise - Pittsburgh Post-Gazette

This looks like UPMC is really playing hardball to get their way. They decided not to bid on the contract to be the city's health benefits carrier. UPMC has been running commercials all week with a doctor and their board chairman complaining that Highmark has stated they need to shift 41,000 annual patient admissions Highmark has said it needs to shift away from UPMC's hospitals in southwestern Pennsylvania and into its AHN hospitals to achieve their financial goals. Yet UPMC is willing to walk away from 7,900 covered lives most of whom live within the city limits. This most likely will result in Aetna, Cigna or United Healthcare getting the insurance business with access to all hospitals.

[Clint.]

Originally Posted by villageidiot1

Pittsburgh-UPMC relationship gets new bruise - Pittsburgh Post-Gazette

This looks like UPMC is really playing hardball to get their way. They decided not to bid on the contract to be the city's health benefits carrier. UPMC has been running commercials all week with a doctor and their board chairman complaining that Highmark has stated they need to shift 41,000 annual patient admissions Highmark has said it needs to shift away from UPMC's hospitals in southwestern Pennsylvania and into its AHN hospitals to achieve their financial goals. Yet UPMC is willing to walk away from 7,900 covered lives most of whom live within the city limits. This most likely will result in Aetna, Cigna or United Healthcare getting the insurance business with access to all hospitals.

No doubt that UPMC is overtly political. Companies are targeted by governments now and then, but UPMC seems to be especially antagonistic and outright hostile in their response. I don't think they have any friends in government; even Gov. Corbett, not exactly a politician people could expect to intervene in private business affairs, said around this time last year that if they don't agree to a contract with Highmark the state will do it for them.

[IdeaOfOrder]

UPMC can afford to play hardball with the city. They have 55,000 subscribers locked in as sole provider of insurance for UPMC, and another 12,000 locked in as sole provider to the UofPitt. Those numbers are larger if you use the "covered lives" metric. I don't foresee any of the other companies with a large presence going exclusively with WPAHS/Highmark other than Highmark (20K jobs?).

UPMC's gamble in this is: Will the people currently with Highmark insurance be willing to switch doctors? They're betting that when push comes to shove, your average covered Pittsburgher is going to take the easy option of checking a different box on a registration form during open enrollment and switch from Highmark and then complain about the injustice, instead of making the effort to find a new doctor, learn the route to the new doctor, make all the phonecalls/emails/hand-deliveries to get their records from UPMC to their new docs, etc.

[gg]

The healthcare industry has sure lost its way. Sad. It sure is all about greed with the higher ups. Ah well, we can always go to different cities. The Cleveland Clinic perhaps.

[trackstar13]

Originally Posted by IdeaOfOrder

UPMC's gamble in this is: Will the people currently with Highmark insurance be willing to switch doctors? They're betting that when push comes to shove, your average covered Pittsburgher is going to take the easy option of checking a different box on a registration form during open enrollment and switch from Highmark and then complain about the injustice, instead of making the effort to find a new doctor, learn the route to the new doctor, make all the phonecalls/emails/hand-deliveries to get their records from UPMC to their new docs, etc.

I agree with the first part of your post, but you are missing one big issue here. Many employers in western PA only offer one healthcare option. In other words, Joe works for employer A and they offer Highmark only and Betty works for employer B and they offer UPMC only. While this is not the case for the biggest employers typically where they have choices during open enrollment, there are many small, medium, or even large employers who offer no choice of health plans. Most people will continue to stick with the healthcare provider offered by their employer because it is usually the cheaper/better option than buying an individual policy. My current employer has over 1,000 employees and our only healthcare option is Highmark. I have talked to many others in/around Pittsburgh and Erie and it seems that there are many employers of varying sizes who only offer one healthcare provider. This will be interesting to see how this all shakes out, because I will be one of those people who uses whatever health plan is offered by my employer and that may mean no more UPMC for me in the future.

[gg]

Had an interesting experience calling my doctor's office the other day. They asked what insurance I have. I said blue cross/blue shield. They asked it if was Community Blue. I fortunately said, no. Then they said, if you had Community Blue, they couldn't even take me as a cash paying customer. SAY WHAT?

What is wrong with this picture? I certainly am not impressed with the direction of UPMC and their attitude. They enjoyed a monopoly for a while. Hope they get busted up, but it seems all industries are going to have just a few big players. Strange industry and that is all it is. There might be some day I just won't be able to use my primary doctor anymore.

[Moby Hick]

Originally Posted by villageidiot1

I don't think insurance companies (payers) and hospitals (providers) should be allowed to combine under antitrust laws, but I see no other way for the West Penn/Allegheny Health System to survive.

They should require them both (UPMC-UPMC insurance and Highmark-West Penn) to separate. I don't think it would be very hard for the state legislature to do so, especially since they need non-profit status and that gives the state a hammer that it wouldn't have otherwise.

Anything else is going to be bad for the region, but only UPMC is going to be worse in the long run.