Attorney general announces legal action in UPMC-Highmark dispute

Attorney general announces legal action in UPMC-Highmark dispute

PITTSBURGH — Pennsylvania Attorney General Josh Shapiro filed a petition to stop UPMC and Highmark from a complete separation – which was set to happen this summer.

“Given the effect this dispute between UPMC and Highmark is having on Pennsylvanians, and the imminent expiration of the existing consent decree, we are asking the court to take action,” said Shapiro.  “These changes are absolutely necessary to prevent UPMC from inflicting further harm on the public by forsaking its charitable obligations in pursuit of commercial success.”

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The petition, which was filed in Commonwealth Court, seeks a modification of consent decrees that govern the relationship between the two healthcare giants. The petition asks the court to:

  • Enable open and affordable access to UPMC's health care services and products through negotiated contracts with any health plan
  • Require last, best-offer arbitration when contract negotiations between insurers and providers fail
  • Protect against UPMC's unjust enrichment by prohibiting excessive and unreasonable billing practices inconsistent with its status as a non-profit charity providing healthcare to the public

In 2014, the state intervened in the dispute between UPMC and Highmark, issued consent decrees with both organizations. Those decrees govern how the two companies must interact to protect further harm to the public, according to a release by the attorney general’s office.

Shapiro said Highmark agreed to the modifications but UPMC did not, leading to legal action.

Paul Wood, UPMC Vice President of Public Relations and Chief Communications Officer, released the following statement:

"The five-year transition as provided for by the Consent Decrees expiring June 30, 2019 has allowed businesses and consumers substantial time to prepare for the end of the UPMC-Highmark relationship in western Pennsylvania. During that period, the region's insurance marketplace transformed from one of the nation's most highly concentrated and least competitive to one of the most competitive and pro-consumer markets in the nation with some of the lowest cost health plans available anywhere.
Consumers have greatly benefitted from the heightened competition. Nearly all businesses now offer alternative, affordable plans so their employees can choose insurance products that allow them full, unfettered in-network access to the UPMC hospitals and physicians they desire. 
As for Medicare Advantage, a federally regulated program, seniors now have more options and enjoy the benefits increased competition provides in terms of low pricing and more expansive plan design. To the extent there remains any confusion, seniors with Medicare Advantage plans have another opportunity, from January 1 through March 31, to clarify their options and switch their coverage so they have the in-network access to the providers they prefer."

County Executive Rich Fitzgerald and Pittsburgh Mayor Bill Peduto also released a statement:

"All public charities – including UPMC and Highmark – should follow state law and act in the best interest of patients and families.
We are confident that the Attorney General and others in state government can work on a solution to this matter, whether through the courts or through legislation, that makes sure all hospital patients are treated fairly and in accordance with Commonwealth law."