State lawmakers want Highmark Inc. and UPMC back at the negotiating table before the stalemate between the two Pittsburgh health care giants disrupts access to doctors and hospitals.

Calling the standoff a “crisis,” Rep. Anthony DeLuca, D-Penn Hills, said a hearing planned for Thursday morning in the Allegheny County Courthouse should help state legislators figure out what they need to do to get the state’s largest health insurer and hospital network to restart talks on a contract that is set to expire in about 10 months.

“It makes no sense to me that these two conglomerates can’t get together and come to some kind of agreement,” said DeLuca, who’s minority chair of the House Insurance Committee, which is holding the public hearing. “Maybe through the hearing process we can get some answers … to take back to Harrisburg.”

Lawmakers are concerned that people with health insurance through Highmark — which covers about 70 percent of the market in Western Pennsylvania — won’t have access to UPMC’s 2,700 doctors once the contract between the two nonprofit organizations expires on June 30, 2012, DeLuca said.

The contract sets in-network rates for Highmark members seeing UPMC doctors or going to UPMC’s 19 hospitals. Without a contract, Highmark members would have to pay out of pocket for UPMC services.
Read more from the Pittsburgh Tribune-Review

Officials at Highmark Inc. have submitted documents to the state attorney general regarding the Pittsburgh insurer’s planned acquisition of the West Penn Allegheny Health System and the system’s $1 billion-plus debt in bond and pension obligations.

Since the June 28 announcement that Highmark intended to buy West Penn Allegheny, officials for both organizations have been working out details behind closed doors and without public comment.

But Steve Foreman, associate professor of health administration and economics at Robert Morris University, says West Penn Allegheny’s $800 million bond debt may have to be addressed before the purchase is completed.

“If I were doing this deal, I would put West Penn Allegheny through bankruptcy and get rid of that debt,” he said.

What’s more, he added, Highmark may have little choice.

Based on actions taken by attorneys general in other states in which a nonprofit entity tried to change its organizational structure, he said, the attorney general’s office may consider Highmark’s bountiful reserves a “community asset” — money that should be used to further Highmark’s core mission of providing insurance and moderating premium costs for local residents, rather than pulling a health system out from under a mountain of debt.

For more on the story, go to the Pittsburgh Post-Gazette

Even as Highmark Inc. and West Penn Allegheny Health System talk about starting a new relationship, their old disputes continue to play out before the Supreme Court.

Two days after the region’s largest insurer announced it would pay $475 million to take over West Penn Allegheny, the financially ailing health system filed documents with the court June 30 reiterating its contention that Highmark colluded with rival UPMC in an effort to drive West Penn Allegheny out of business. The documents are part of a legal battle dating to 2009 when the hospital system sued Highmark and UPMC.

“Highmark took steps to undermine competition from UPMC’s principal competitor, West Penn,” lawyers for the health system state in the filing. “Highmark leaked confidential information regarding West Penn’s finances to UPMC, rejected West Penn’s requests to finance an outstanding loan, discriminated against West Penn in awarding grants, and eliminated a low-cost insurance plan that had directed patients to West Penn.”

Highmark and UPMC deny the accusations, and they want the high court to dismiss the lawsuit. But with Highmark moving to take over West Penn Allegheny, legal experts said the insurer easily could move from co-defendant to co-plaintiff.

For the rest of the story, read the Pittsburgh Tribune-Review

In less than a year, clients of Highmark Inc. health care plans who use physicians affiliated with UPMC Health System probably will have a choice to make.

The contract that keeps UPMC doctors in network for Highmark users expires on June 30, 2012. So Highmark customers will have to either pay an out-of-network fee to stay with their UPMC doctor or find another caregiver.

Highmark spokesman Michael Weinstein said last week that although UPMC officials have threatened to end physicians’ contracts without any extension, his company has not yet received anything in writing.

However, UPMC spokesman Paul Wood said that because the physicians’ contract expires next year he is urging patients to select one of five other insurance companies that will be honored by UPMC if they want to keep their doctors.

For more on the story, go to Beaver County Times

In the world of health care, hospitals and doctors routinely battle with insurers. But with Highmark Inc. entertaining a takeover of the struggling West Penn Allegheny Health System, the Pittsburgh insurer could become a provider — or at least might become heavily invested in one — altering the regional health care landscape.

While such a move is unusual these days, it was more common following the HMO Act of 1973. That law provided funding for the creation and expansion of health maintenance organizations. And it had the corollary effect of allowing insurers to build their own provider organizations and “prepaid group practices,” getting physicians to join HMOs, or even acquiring entire hospitals.

“That’s when you saw a lot of these carriers buying these hospitals and networks, thinking that would be the most effective way to deliver care,” said Tom Tomczyk, principal and health expert with Buck Consultants’ local office.

But “if you go across the country, those are far and few between” now, he said.

The best-known example nationally might be Kaiser Permanente, the multi-state hospital system and health plan based in California. And, of course, Highmark’s top rival, the University of Pittsburgh Medical Center, operates a nonprofit hospital system and a for-profit insurance plan.

Another insurer-provider partnership is in our backyard: Geisinger Health System and Health Plan, the mostly rural, mid-state hospital system and insurance plan headquartered in Danville, Montour County.

Geisinger’s health plan has been in place since 1985, with a parent board overseeing both the health system and its health plan. Today it has 250,000 members in 42 Pennsylvania counties, coming as far west as Somerset, Cambria, Clearfield and Jefferson counties.

Geisinger has been nationally recognized for successfully building a vertically integrated, multi-speciality system.

“We believe that to make care more efficient, have better clinical outcomes and contain the growth of costs, there needs to be integration of insurers and providers,” said Frank Trembulak, executive vice president and chief operations officer for the Geisinger Health System.

Theoretically, an integrated provider-insurer makes sense — when the hospital and the insurer are under the same umbrella, there’s no haggling over prices, cost limits are easier to achieve, and quality control and preventive care goals can be more broadly aligned.

For the rest of the story, read Pittsburgh Post-Gazette

“Nurse practitioners in Pennsylvania took another step toward equal footing with family doctors.

Health insurer Highmark Inc. said Wednesday that it will recognize nurse practitioners as primary care providers, a designation that previously applied only to physicians.

This will make it easier for patients to choose a nurse practitioner to take care of their general medical needs, said Dr. Carey Vinson, Highmark’s vice president of quality and medical performance management.

The biggest change will likely involve nurse practitioners who work in their own practices. These nurse practitioners, once they are approved by Highmark, will be included in Highmark’s network of primary care providers, and listed in the directory.”

Read more at the Patriot News

Highmark’s first retail store opened in the Pittsburgh area in the beginning of March.  At that time, WTAE-TV reported:

“A Pittsburgh area insurer is taking a new approach to making health care more available and affordable, but the approach its taking is generating controversy.

Highmark is attempting to cut through the negative stigma looming over the health care industry by pushing a friendlier approach at its new retail insurance store in Ross Township, opening Saturday.

Customers can learn more about their health and purchase health insurance if they don’t already have it.

…

But the Western Pennsylvania Coalition for Single-Payer Health Care is protesting Highmark’s new concept.

“Health care is not a commodity to be bought and sold. It’s not a commodity for the fortunate. It’s a human right that should be for everyone. Everyone deserves equal health care,” said Sandy Fox of single-payer health care.”

Now, Highmark has opened a store in the Harrisburg area. Reports the Patriot-News:

“The Highmark store is open Monday through Saturday from 10 a.m to 7 p.m. Highmark, which has described the store as being part of a “pilot,” opened a similar store in western Pennsylvania.

Customers can also sign up for state programs including adultBasic and CHIP, government subsidized plans administered by private insurers.”

His comment, at a news conference here attended by more lobbyists than reporters, came on the day after the two health insurers withdrew their merger request.

“The simplest and most direct” way to add competition to the “Pennsylvania market would be to create ‘Blue on Blue’ competition,” Ario said, referring to the popular Blue Cross Blue Shield trademarks. Read more from The Philadelphia Inquirer

Independence Blue Cross is withdrawing its request to merge with Highmark Inc. in Pittsburgh, according to sources on the Independence Blue Cross board and in Harrisburg.

The boards of Independence Blue Cross and Highmark met this morning and decided to withdraw their application. They will make a joint statement this afternoon.

Their decision comes days before the state’s insurance department was set to render a decision on their merger.

That’s because the decision, expected Jan. 28, was not likely to please the companies, sources said.

The decision would have allowed them to merge, but would require them to give up the right to use the popular “Blue Cross” trademark in selling health insurance.

Instead, they could use the “Blue Shield” trademark, opening the door for another insurance company to compete statewide using the “Blue Cross” trademark.

When that idea had been suggested during public hearings in July, executives from the companies were vociferously opposed. The merger would have created the largest health insurer in the state and among the largest in the nation.