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UPMC, Highmark battle rages at public forum; Melani has words for both

| Tuesday, May 20, 2014, 10:51 p.m.
UPMC senior vice presidents Gregory Peaslee, left, and Robert DeMichiei speak to local employers during a forum hosted by The Pittsburgh Business Group on Health Tuesday, May 20, 2014 at the Marriott City Center, Uptown.
Jasmine Goldband | Tribune-Review
UPMC senior vice presidents Gregory Peaslee, left, and Robert DeMichiei speak to local employers during a forum hosted by The Pittsburgh Business Group on Health Tuesday, May 20, 2014 at the Marriott City Center, Uptown.

Highmark Inc. and UPMC ratcheted up the rhetoric Tuesday in their battle over the end of a reimbursement contract, as the two health giants try to sway employers in Western Pennsylvania to choose a side.

And after keeping a low profile for the last two years, former Highmark CEO Ken Melani jumped back into the fray, calling for the companies to stop spreading misinformation and come up with a plan for patients.

The comments came during a forum sponsored by the Pittsburgh Business Group on Health, in which Highmark, the state's largest insurer, said 69 percent of UPMC's 3,500 physicians would remain in-network to Highmark insurance subscribers after the contract expires at the end of this year — a claim that UPMC officials quickly dismissed as a fabrication.

“We have a very compelling reason to believe a significant number of UPMC (doctors) will be in-network,” Deborah Rice-Johnson, the president of Highmark Health Plans, said during a forum on the contract dispute sponsored by the Pittsburgh Business Group on Health.

Rice-Johnson said the number comes from adding up the UPMC doctors who work at several so-called exception hospitals that will remain in-network next year — such as Children's Hospital of Pittsburgh and several rural hospitals — plus UPMC physicians working for joint venture cancer centers at community hospitals and those with admitting privileges at community hospitals.

She added that UPMC and Highmark officials had agreed to the methodology for determining which physicians would remain in-network during discussions over a transition plan the insurer must submit to the state Department of Insurance in July.

“Highmark outright lied to this group,” UPMC spokesman Paul Wood said, adding that no discussions have taken place between the feuding parties.

UPMC Chief Financial Officer Robert DeMichiei told the forum that he wanted “to be totally clear: There is 100 percent certainty that there will not be a contract” with Highmark.

Insurance department spokeswoman Melissa Fox declined to comment, stating that the agency doesn't comment on discussions it has with companies it regulates.

The dispute over the contract dates to 2011 when Highmark announced that it would buy the struggling West Penn Allegheny Health System, Pittsburgh's second-largest hospital network and the primary competition for UPMC, the region's largest hospital system.

The man who planned that deal, Melani, made a rare public appearance during the forum and scolded both UPMC and the insurance company he ran until 2012. Melani was fired after getting into a fistfight with the husband of a woman who was his mistress and a Highmark employee.

“To tell you they're going to have a contract, just throw that out the window,” Melani said, referring to Highmark's advocacy of bills in Harrisburg to force a contract and claims that UPMC would eventually relent in its refusal to talk. “They need to move on.”

Highmark is trying to convince its members to not leave for a competing insurer with full in-network access to UPMC by “painting a rosy picture that probably isn't real,” Melani said. UPMC, meanwhile, is “dropping an atomic bomb that isn't real,” he said, in the hope that panicked patients will abandon Highmark.

Melani said the departments of insurance and health need to force Highmark and UPMC to come up with a plan for how they will deal with patients that lose access to their doctors and hospitals.

The issues for patients are “too critical not to be engaged,” he said.

In a separate development, the Intermediate Unit 1 Health Care Consortium, which serves 31 school districts in Fayette, Greene and Washington counties, said it was keeping Highmark as its health insurance provider.

The consortium, which provides health coverage to 17,000 employees and their dependents, said it would keep Highmark as it carrier for three years, starting in 2015. UPMC doesn't own hospitals in those counties.

Allegheny County and the Allegheny County Schools Health Care Consortium have made similar announcements recently.

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

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