UPMC, Highmark Reach 10-Year Deal on Hospital Access

By Jason Togyer | Posted in: News

UPMC McKeesport hospital (Tube City Almanac file photo)


Local officials and health care advocates are praising a deal that will give Highmark Blue Cross Blue Shield customers access to UPMC hospitals and facilities for the next 10 years.

The agreement, brokered by Pennsylvania Attorney General Josh Shapiro and Gov. Tom Wolf, was announced Monday --- just a week before a consent decree between the two health giants was scheduled to expire.

Not all of the details were public, but a spokesperson for Shapiro said the deal --- reportedly the longest ever signed between UPMC and a health insurance company --- will cover all UPMC facilities.

State Sen. Jim Brewster of McKeesport called the agreement “excellent and welcomed news” that will relieve “tension and anxiety” for people with Highmark health insurance.


“Insurance coverage should not be a barrier that prevents a sick patient from seeing a doctor or provider of their choice,” Brewster said in a prepared statement. “Highmark and UPMC have a responsibility to serve those who need care and I applaud them for their ability to reach this agreement.”

Shapiro and his team should be "applauded," said state Rep. Austin Davis of McKeesport, who called the agreement "historic."

"Today is a huge victory for residents of Western Pennsylvania, particulary seniors and sick children, to make sure that everyone there has access to quality health care," Davis said.


The agreement comes after public officials, former UPMC board members and the Pittsburgh Post-Gazette have put increasing pressure on UPMC leadership, including Jeffrey Romoff, president and chief executive officer of the health system, to resolve their animosity with Highmark.

One-time UPMC board member Paul O'Neill, former chairman and CEO of Alcoa and former U.S. secretary of the treasury, called Romoff “evil” and labeled the fight between UPMC and Highmark an “unspeakable public tragedy.”

Jim Rohr, former chairman and CEO of PNC Financial Corp., alleged that Romoff’s mission was to "destroy" Highmark, "not to serve the public."


Highmark owns Allegheny Health Network, which operates Jefferson Hospital near Clairton and Forbes Regional Hospital in Monroeville. It serves 21.7 million health insurance customers and owns eight hospitals, with five "mini-hospitals" under construction or near completion, and had estimated revenue last year of $18.2 billion.

UPMC, with annual revenues estimated at $19 billion, has 40 hospitals --- including UPMC McKeesport and UPMC East in Monroeville --- and 3.4 million people enrolled in its health insruance plan.

The two non-profit health care giants have been battling for more than 20 years, when UPMC created its own health insurance plan in competition with Blue Cross Blue Shield.

In 2002, Romoff, CEO of UPMC, declared that the competing Allegheny Health Network --- then called West Penn Allegheny Health System --- was a "loser" and it would "either (go) out of business or (get) bought by a winner."


In 2011, Highmark Blue Cross Blue Shield reached an agreement to purchase West Penn Allegheny, and UPMC announced that it would no longer sign contracts with Highmark to accept its insurance customers for in-network care.

In 2014, state officials brokered two five-year agreements, or consent decrees, where UPMC would continue to accept Highmark insurance for many "vulnerable" patients, including those with life-threatening conditions or Medicare Advantage plans.

But many Highmark customers lost access to UPMC facilities and doctors, and many Highmark doctors and hospitals were no longer in-network for UPMC Health Plan customers.

The consent decrees negotiated in 2014 were set to expire this June 30. Shapiro filed a lawsuit in February in an attempt to get the decrees extended.

UPMC countersued Shapiro in federal court, calling his attempt to get the decrees extended an "illegal scheme" that violated the health system's constitutional rights.


On Monday, Paul Wood, UPMC spokesman, praised Shapiro for his leadership in bringing both sides to the negotiating table.

"The agreement announced today was built on a foundation of trust, compromise and collaboration," Wood said in a prepared statement. "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.

"This important consumer issue was resolved in a collaborative fashion and UPMC’s network will now be available to Highmark members," Wood said. "UPMC appreciates that we were able to reach this agreement with Highmark on a long-term, in-network contract."


Allegheny County Controller Chelsa Wagner, who convened a series of public meetings on the Highmark-UPMC feud, including one at Carnegie Library of McKeesport, said the agreement would not have been possible "without the thousands of regular citizens who made their voices heard and stood up against these mega-charities to defend their right and their neighbors’ rights to healthcare access."

Others, including Antoinette Kraus, director of the Pennsylvania Health Access Network, agreed. She called the deal "a testament to the power of patient voices."

"Thousands of senior citizens, cancer survivors, transplant patients, and others courageously shared their stories with lawmakers, the media and hospital leadership in an effort to keep the doors of our non-profit, community hospitals open to everyone," Kraus said. She thanked Shapiro, Wolf and their staffers for "listening, acting and holding UPMC and Highmark accountable to meeting their charitable obligations."


State Sen. Jay Costa Jr. of Forest Hills and other elected officials have been working on legislation to compel UPMC, Highmark and other health care providers to either contract with each other voluntarily for services, or enter mandatory arbitration if they fail to come to an agreement on their own.

In a prepared statement, Wagner called on the state General Assembly to continue that work.

"While this agreement is a welcome development, we still need to finish the job with legislation that puts an end to all uncertainty, so that five or 10 years down the line, no entity can use our healthcare as a bargaining chip," she said.


Davis, the state representative, echoed Wagner's comments.

"We need to continue to fight here in the legislature so that at the end of this 10-year agreement, we don't end up in the same situation again," he said.

The Pittsburgh area has "world-class health care," said Brewster, the state senator, but people who are sick and need help should be able to get care from whatever doctors, nurses and specialists they choose, "regardless of the insurance they carry."

Kraus, of the Pennsylvania Health Access Network, agreed. "Non-profit institutions should not be able to pick and choose who they serve," she said.


According to Wood, the agreement will provide in-network access for Highmark customers "at the highest benefits levels" to UPMC facilities in Pittsburgh, Erie and throughout the western half of the state.

The agreement also extends existing agreements between Highmark and UPMC's Children's Hospital of Pittsburgh and Western Psychiatric Institute and Clinic.

The contract will go into effect on July 1, the day after the expiration of the current consent decrees, "ensuring that patients should not experience any disruption in their care," a spokesman for Shapiro said.

All UPMC hospitals will be accessible to Highmark insurance customers, the spokesman said.


Jason Togyer is volunteer executive director of Tube City Community Media Inc. and editor of Tube City Almanac. He may be reached at jtogyer@gmail.com.

Originally published June 24, 2019.

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