Modern Healthcare - - LATE NEWS -

A gover­nor-bro­kered deal has ended the long, ugly fight in Pitts­burgh over whether mem­bers of Highmark health plans can keep get­ting in-net­work care at fa­cil­i­ties op­er­ated by ri­val UPMC. Penn­syl­va­nia’s Depart­ment of In­surance re­quired Highmark to de­tail a tran­si­tion for UPMC pa­tients as a con­di­tion of its April 2013 ac­qui­si­tion of West Penn Al­legheny Health Sys­tem. Un­der a deal an­nounced by Gov. Tom Cor­bett, Highmark mem­bers will con­tinue to have some in-net­work ac­cess to UPMC providers—in­clud­ing on­col­o­gists and spe­cial­ists in be­hav­ioral health and pe­di­atrics— af­ter the con­tract ex­pires Jan. 1.

Phoenix-based Ban­ner Health and the Univer­sity of Ari­zona Health Net­work in Tuc­son signed a nearly $1 bil­lion agree­ment for Ban­ner to ac­quire UAHN and its sub­sidiaries. That would in­clude the Univer­sity of Ari­zona Med­i­cal Cen­ter, UAHN’s fac­ulty prac­tice, Univer­sity Physi­cians Health­care, and the sys­tem’s three health plans. Ini­tial terms call for Ban­ner to spend at least $500 mil­lion on cap­i­tal projects in the next five years and pay $300 mil­lion to es­tab­lish an aca­demic en­dow­ment. UAHN’s long-term debt, to­tal­ing about $146 mil­lion, would also be paid off, and the Univer­sity of Ari­zona and its med­i­cal school would be­come Ban­ner’s ex­clu­sive aca­demic part­ner.

Catholic Health Ini­tia­tives’ ac­qui­si­tion streak proved ef­fec­tive for the di­ver­si­fy­ing sys­tem dur­ing the first nine months of its fis­cal year. The En­gle­wood, Colo.-based sys­tem’s growth—which ex­ec­u­tives say is crit­i­cal to cap­i­tal­ize on con­tracts that link pay­ment to qual­ity and health im­prove­ment—con­trib­uted to a spike in rev­enue and a healthy in­crease in op­er­at­ing mar­gin dur­ing the ninemonth pe­riod that ended March 31, com­pared with the same pe­riod a year ago. Op­er­at­ing rev­enue in­creased 32.5% to $10.2 bil­lion, yield­ing a mar­gin of 0.8% af­ter ac­count­ing for re­struc­tur­ing, im­pair­ments and other losses. With­out its re­cent deals, CHI would have posted an op­er­at­ing loss of $136.4 mil­lion and a neg­a­tive mar­gin of 1.8%.

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