UPMC, Highmark set terms for contract to expire in 2015

Pennsylvania’s governor announced terms of the contentious breakup of Pittsburgh insurance company Highmark and UPMC, the city’s dominant health system.

UPMC and Highmark, which acquired UPMC’s struggling rival— West Penn Allegheny Health System—have fought aggressively and publicly over the expiring contract for Highmark members to get in-network services at UPMC’s facilities. Highmark has sought to extend the contract, and UPMC refused.

Under the deal announced by Gov. Tom Corbett, Highmark members will get continued access to UPMC after the contract expires Jan. 1. Notably, the deal sets restrictions on “unclear or misleading” advertising and requires Highmark and UPMC to donate $2 million apiece for outreach and to reimburse the state for its role in brokering the deal.

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. “For some time, the people of Western Pennsylvania have been concerned about where and how they will receive their healthcare come Jan. 1, 2015,” the governor said in a news release announcing the agreement.

More detailed plans must be submitted to the state by the end of July, but the terms will give Highmark enrollees continued access to UPMC oncologists, specialists in behavioral health and pediatrics, and UPMC hospitals outside the competitive Pittsburgh marketplace.

Highmark enrollees will be deemed in-network at all UPMC emergency rooms. Those already under UPMC care for a condition or procedure may continue until physicians agree to transfer patients to new providers and Highmark enrollees will have one year to find an alternative doctor.