UPMC, Highmark make nice, reach 10-year network agreement

Pittsburgh
The deal is the longest the University of Pittsburgh Medical Center's ever signed with an insurer, Pennsylvania's attorney general said. (Getty/Joecho-16)

After months of legal back-and-forth, the University of Pittsburgh Medical Center and Highmark have reached an agreement that would extend network coverage for UPMC facilities to Highmark members for the next decade. 

Pennsylvania Attorney General Josh Shapiro announced Monday that the two rivals had reached the agreement after spending two years in negotiations with both healthcare systems to prevent the end of their multiyear consent decrees.  

Shapiro said in the announcement that because those negotiations had stalled, he filed suit in February against UPMC alleging it had failed to meet its charitable obligations to push for a new deal

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“Without this agreement, millions of patients—including seniors, cancer patients and working mothers—would have had their care abruptly ended,” Shapiro said in a statement. “Thanks to the patients who told their stories about what they stood to lose, Western Pennsylvanians now have their access to a fair healthcare system secured for the next decade.” 

RELATED: Penn State Health, Highmark Health sign $1B value-based care network deal 

The deal is a “global” one, Shapiro’s office said, meaning that Highmark members will have access to all UPMC hospitals—it's also the longest deal UPMC has ever signed with an insurer. It will begin July 1, preventing a gap in care when the current consent decrees end June 30. 

UPMC Health Plan members will not have in-network access to Allegheny Health Network, the health system owned by Highmark, however—except for AHN Jefferson Hospital and Saint Vincent Hospital, which have historically been in-network options. 

Highmark’s 2011 purchase of what is now AHN kick-started the rivalry in earnest, leading state officials to step in and mitigate. The result was a five-year agreement that required both to offer in-network care at the other provider's facilities. 

According to a blog post from UPMC, negotiations on a new agreement began again following a state appeals court’s June 14 decision that the consent decrees would end as scheduled

RELATED: UPMC spikes controversial ‘prepay’ policy for Highmark MA members 

UPMC spokesman Paul Wood wrote in the post that it reached out to Highmark following the court decision to work on a potential network agreement for specialty care, including its Hillman Cancer Center, UPMC Children’s Hospital and UPMC Western Psychiatric Hospital.  

That evolved into a larger deal, UPMC said, and the dispute was resolved in a “collaborative fashion.” 

“UPMC believes in the importance of informed consumer choice and has always sought to ensure that when UPMC is part of any insurance network, those members have full access to UPMC without contractual terms used to discourage or limit the use of UPMC’s physicians and facilities,” Wood wrote. 

In a statement, Highmark CEO David Holmberg said the agreement is a “significant step forward for our region.” Highmark and UPMC will finalize the contract terms in the coming weeks, he said. 

“Today’s news about a contract between Highmark and UPMC fulfills the promise to our community that we at Highmark Health have strived to achieve for the last five years: Consumers and patients have two outstanding health systems, in addition to our many independent community hospitals, to choose from for their care,” Holmberg said.  

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