Highmark lays off 28 more, encounters 'hurdle' in Harrisburg
Highmark Inc. shouldn't count on Harrisburg to solve its contract problems with UPMC, two prominent senators told the state's largest insurer.
The troubling political news developed on the same day Highmark announced a second round of layoffs in Pittsburgh and Camp Hill. The company laid off 28 workers in its finance department, including 14 in Pittsburgh. A week ago, it cut 132 workers in information technology and sales.
Highmark has been pushing for bills in the General Assembly that would force hospital giant UPMC to renew a reimbursement contract with Highmark. Without a contract, Highmark members will have to pay costly out-of-network rates at UPMC hospitals and doctors starting in 2015.
But Republican Sens. Don White of Indiana and Joe Scarnati of Jefferson County told Highmark CEO Bill Winkenwerder in a Feb. 18 letter that they opposed the bills because they could violate the state constitution, among other reasons.
“Highmark's continued attempt to have the Legislature engage in this issue is one that will not be supported by either of us for several reasons,” the senators wrote in the letter, which was obtained by the Tribune-Review.
White, chairman of the Senate Insurance and Banking Committee, and Scarnati, president pro tempore of the Senate, are among the most influential leaders in the GOP-controlled Senate, and their opposition presents a “major hurdle,” said Christopher Borick, political science professor at Muhlenberg College in Allentown.
“Having opposition from both those individuals, especially the Senate pro tempore, in Scarnati, is problematic if you're looking to move any legislation forward,” Borick said.
“It's a Republican-held senate with Scarnati in leadership. It's incredibly difficult to have bills move forward if he's not behind them,” Borick said. “Those are significant roadblocks for Highmark as they try to push for something to come out of the Senate.”
Highmark spokesman Aaron Billger said the insurer believes the bills are “good public policy” and downplayed the significance of the opposition from White and Scarnati.
“There's growing support in a bipartisan way in Harrisburg for the legislation,” he said.
House versions of the bills, 1621 and 1622, were introduced in October, and are under consideration in the House Health Committee.
Sens. Randy Vulakovich, R-Shaler, and Jay Costa, D-Forest Hills, have circulated a sponsorship memo for Senate versions of the house bills, but they've not been introduced.
Costa, the Democratic leader in the Senate, could not be reached for comment. Melissa Farabaugh, Vulakovich's chief of staff, said she had not seen the letter from the GOP leaders and couldn't comment.
UPMC spokesman Paul Wood said the hospital network, which opposes the legislation, wants to work with Highmark, the state insurance commissioner and lawmakers on a transition plan that informs Highmark members how to maintain in-network access to UPMC after the contract expires in 10 months.
White and Scarnati urged Winkenwerder to drop Highmark's advertising campaign aimed at UPMC, which the senators called “confusing” and “designed to create fear among the general public,” according to the letter.
Highmark and UPMC should instead “use their financial resources to fund public service announcements” explaining what the end of the Highmark-UPMC contract means for patients in Western Pennsylvania, the senators said.
In September, Gov. Tom Corbett called on UPMC and Highmark to drop negative advertising that had flooded the airwaves and newspaper pages in Pittsburgh. While the two health giants have toned down their commercials, the ads continue.
“Once we return to civility by both UPMC and Highmark, we believe a constructive conversation can be had regarding how both organizations can vest serve Western Pennsylvania in the future,” White and Scarnati wrote.
Wood said UPMC this week dropped its recent campaign attacking Highmark. Billger said Highmark believes its ads are necessary “to educate the public and set the record straight.”
Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or firstname.lastname@example.org.
Add Alex Nixon to your Google+ circles.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- New York farmers lament lost opportunity for gas riches
- CR-V popular, fuel-efficient
- Energy sector adjusts to global oil plummet
- Real estate union: Howard Hanna buys Langholz Wilson Ellis
- U.S. coal mines nearing record low in worker deaths
- Hospital finances still crying ‘ouch’
- As smokers seek Cuban cigars, retailers point to trade embargo
- ‘Staff Pick’ is golden ticket on Kickstarter
- 8 Western Pennsylvania hospitals penalized over infections
- Mind the time: Optimize last-minute shopping
- Peet’s Coffee & Tea closes its 3 Pittsburgh stores