Highmark adds more land for its $1B provider network
By Alex Nixon and Sam Spatter
Published: Friday, June 22, 2012, 6:30 p.m.
Highmark Inc.'s acquisition of property in fast-growing Cranberry is the latest in a string of land deals the health insurer has made this year for its plan to establish a network of outpatient medical centers in suburbs ringing Pittsburgh.
The company, which is developing a $1 billion provider network to compete with UPMC, the dominant health system in the region, has also bought land in Pine and Monroeville.
In the latest purchase, Highmark spent $8.9 million for a 25-acre site along Route 228. A Highmark subsidiary, Principo Advisors LLC, on May 31 acquired the Butler County property from Mine Safety Appliances, according to Butler County deed records.
While no specific plans for the site have been finalized by Highmark, spokesman Aaron Billger said the purchase is part of its provider strategy “to keep care in the community” that is cost-effective and “close to our members.”
The deed for the land on Route 228 states that its use “shall be limited to activities primarily relating to a medical mall, health care facilities,” or other medical-related uses.
In event that Principo determines it isn't economically feasible to construct and use facilities meeting the uses described in the deed, the property may be used for corporate headquarters or office purposes, the deed states. Principo must begin construction on or before June 1, 2014, the deed also states.
Butler Health System, which operates some outpatient services from the Cranberry YMCA, has had “very, very preliminary” talks with Highmark about the insurer's plans in the Cranberry area, said Kevin Stansbury, Butler's vice president of business development.
Butler has no plans to partner with Highmark on development of a medical mall, he said. The system, which has recently expanded outpatient services in Saxonburg and Slippery Rock, would be open to partnerships with any provider and further expansion in Cranberry, which Stansbury called “a very fast growing market.”
Highmark, the state's largest health insurance company, has said its $1 billion network will be anchored by the West Penn Allegheny Health System, which Highmark is trying to acquire, and will include physician practices, 10 medical malls or outpatient centers, Jefferson Regional Medical Center and other components.
The Cranberry land deal follows transactions by Highmark worth $10.3 million in Pine earlier this year. Another Highmark subsidiary, Optimus 28 Management, assembled 33 acres of land along Route 19 that also could be used for a medical mall or similar outpatient facility.
“There have been engineers working on the site Optimus purchased and they informed me that they were working for Highmark,” said Scott Anderson, Pine Township's assistant manager.
Officials with Pine and Cranberry said they have not received plans from Highmark or its subsidiaries regarding uses of the properties.
Highmark also paid $2.6 million for property in Monroeville last month through a subsidiary called Osiris Properties LLC. And it plans to finish work on an outpatient facility in Murrysville that was started by West Penn Allegheny.
Billger said Highmark has been forming shell companies, such as Osiris, Optimus and Principo, to acquire land for its provider network so that it isn't over-charged by land owners. The companies have been formed by Cranberry attorney Severin Russo, who could not be reached for comment.
West Penn Allegheny, which owns five hospitals, also has outpatient centers Peters, McCandless, Bellevue, New Kensington and Vandergrift.
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.
- Kovacevic: Time to end the Woodley mistake
- Ex-Pens winger Asham looking forward to retirement
- Starkey: Pens goalie situation intriguing
- Stats Corner: Penguins rookies earning their keep
- Ex-Steelers assistant Perles bowl ringmaster
- Penguins minor league notebook: Wilkes-Barre still fields pair of NHL veterans
- Letang has surgery on infected elbow
- Crosby leads Penguins to 7th straight win
- Haley hitting stride in 2nd season as Steelers assistant
- Reason debated for former Penn State lawyer Baldwin’s about-face
- Future brightens for Alle-Kiski Commuter Rail project