DoJ drops probe into Highmark's anti-competitive actions

The Department of Justice (DoJ) has ended an investigation into whether Highmark and the University of Pittsburgh Medical Center (UPMC) were engaging in anti-competitive practices in the Pittsburgh area health market, reports the Pittsburgh Business Times.

Federal investigators started looking at Pennsylvania's largest health insurer after West Penn Allegheny Health System filed a complaint with the DoJ in 2006, according to the Pittsburgh Tribune-Review.

"The crux of the investigation was why the national insurers couldn't crack this market," UPMC chief legal counsel Tom McGough told the Business Times. "We are aware of lots of market dynamics that kept national insurers out or discouraged their participation." However, no specific violations or charges were ever made.

Highmark negotiates the best prices for its members but has not acted to limit competition from other insurers. "We welcome competition," spokesman Aaron Billger told the Tribune-Review.

In McGough's opinion, Highmark has prevented other insurers from getting into the market by reimbursing providers at below-market rates in exchange for volume, which Highmark could promise because virtually every provider accepts its coverage. "The only way you can reduce the rates is make up the difference in volume," McGough said. "Volume is key."

To learn more:
- see the Pittsburgh Business Times article
- read the Pittsburgh Tribune-Review article

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