Highmark unveils $100M medical mall in Pine but scales back plans for more

| Thursday, Dec. 13, 2012, 1:02 p.m.

Highmark Inc. will spend about $100 million to build an elaborate outpatient medical facility on Perry Highway in Pine, the health insurance company said on Thursday during a ground-breaking ceremony.

But it has scaled back plans that once called for a network of at least eight of the facilities, known as medical malls, around Western Pennsylvania on concerns about cost and duplicating existing medical services, CEO William Winkenwerder said.

“We want to make sure we have the concept right,” Winken-werder said.

Medical malls offer one-stop shopping for a wide range of outpatient medical services, such as primary care and specialty physicians, testing, imaging and outpatient surgery.

The malls are a key piece of Highmark's strategy to create a health system to compete against UPMC, the largest hospital network in Western Pennsylvania. Highmark is trying to acquire West Penn Allegheny Health System, which owns five hospitals in the region. And it has struck deals to control Jefferson Regional Medical Center in Jefferson Hills and St. Vincent Health System in Erie. It is also buying private doctor practices, such as Premier Medical Associates in Monroeville.

But West Penn Allegheny has no major facilities in Pittsburgh's growing North Hills region, while UPMC has hospitals in Cranberry and McCandless.

“This is where people live,” Winkenwerder said of the area north of Pittsburgh.

Medical malls have several benefits for patients and for Highmark. Because many services are under one roof, it's more convenient for patients who won't have to drive to multiple locations for doctor appointments, tests and to pick up prescription drugs.

For Highmark and West Penn Allegheny, which will supply many of the specialty doctors for the Wexford Medical Mall, that convenience will draw in new patients to the system and allow medical care that often is provided in a hospital to happen in a more cost-efficient setting.

The Wexford Medical Mall will offer a cancer center, medical imaging, pharmacy, drop-off child care, physical therapy, a vision store, family and internal medicine doctors, a cafe, demonstration kitchen, cardiac testing, laboratory, pediatrics, ambulatory surgery and a women's health center.

It's a model that already exists in Western Pennsylvania, but not to the same scale.

Greensburg-based Excela Health runs a medical mall in North Huntingdon that offers many of the same services, but is about half the size of what Highmark is planning.

Heritage Valley Health System in Beaver has several much smaller medical malls, which it calls medical neighborhoods, west of Pittsburgh.

Executives from both systems have previously said the centers are advantageous because they operate more efficiently and increase patient volume.

Highmark's scaled-back medical mall network will now only include three sites, Winkenwerder said: the Wexford Medical Mall, an ambulatory surgery center in Monroeville and another medical mall in an undisclosed location.

The Monroeville surgery center, on Monroeville Boulevard, is awaiting approval from local officials. The Monroeville Planning Commission will consider Highmark's plans next week.

As for a third site, Highmark has spent more than $32 million acquiring land since 2011 across the Pittsburgh region, including property in Cranberry, Ross and South Strabane, in addition to Pine and Monroeville.

Highmark will pay property taxes on the medical mall in Pine, spokesman Aaron Billger said. Even though the facility will be owned by a nonprofit subsidiary of the insurance company, Billger said the company decided it wanted to pay taxes.

The mall, which still requires final approval from Pine Township, is expected to open in 2014.

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or anixon@tribweb.com.

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