Hospital Integration Drives Insurer, Hospital Group to the Brink in PA

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Even as the Supreme Court considers the constitutionality of the Affordable Care Act this week, the potentially ugly side of healthcare integration is snarling in Pittsburgh, PA, the Wall Street Journal reports.

The city’s leading provider network ( University of Pittsburgh Medical Center, or UPMC) and leading health insurer ( Highmark) are at loggerheads over a recent move by Highmark to acquire the failing West Penn Allegheny Health System, which UMPC deems a direct competitor.

In response, UMPC says it will not sign any new contract to cover Highmark patients; the current arrangement between the two expires next summer. If that happens, Highmark-insured patients who receive care from UPMC physicians would be paying dramatically increased rates for their care.

Both sides are courting doctors with exclusivity contracts. Hospitals worry about managing an influx of patients frozen out of their previous provider networks. Employers are preparing coverage contingency plans in the event a new deal cannot be reached.

The public relations battle between the two has been bitter and protracted, playing out in barbs thrown back and forth among the two CEOs. Pennsylvania health officials are trying to broker a deal between the two, even as state legislators consider bills that would force binding arbitration upon them.

If such is the cost of driving lower-cost efficiencies, many Pittsburghers will be checking their coverage for antianxietals over the next 15 months.