Health care giants UPMC, Highmark reach agreement over anti-trust suits
UPMC and Highmark Inc. might finally agree on something: It's time to end a four-year legal battle.
The health care giants on Wednesday tentatively agreed to end a pair of antitrust lawsuits. But that won't keep the contract between them from expiring in December 2014.
“It probably means very, very little to the customers,” said Jim McTiernan, area vice president of Triad USA, which helps employers manage health and welfare benefits.
Pushed by a federal judge, lawyers reached the deal to end a 2009 lawsuit that West Penn filed against UPMC, and a 2012 lawsuit that UPMC filed against Highmark and West Penn.
“It wouldn't be fair” to provide details of the agreement, said Paul Pohl, an attorney for UPMC, when negotiators emerged two hours after the judge sent them to a back room to talk. Pohl said UPMC is ready to sign, but Highmark executives need to review the deal. That's expected to happen on Thursday, said Margaret Zwisler, Highmark's attorney.
The agreement then needs to be ratified by West Penn Allegheny Health System's board, which is set to meet on Oct. 31. Highmark Chairman Robert Baum, a member of the West Penn board, declined to comment on the proposal.
West Penn's antitrust lawsuit named Highmark as a defendant until the insurer agreed to buy West Penn, a deal that closed in April.
Though both sides would spend millions of dollars more in legal costs if the lawsuits continue, those costs are relatively small compared to UPMC and Highmark's operating budgets, McTiernan said.
The real concern for individuals and employers is the contract that sets rates for people covered by Highmark who use UPMC doctors and facilities, he said.
“If you asked most employers, they wouldn't even be aware of these lawsuits,” he said.
UPMC and Highmark agreed to drop the lawsuits as part of a deal Gov. Tom Corbett brokered in May 2012 that extended the insurance contract by 18 months.
U.S. District Judge Joy Flowers Conti has pressed the lawyers to live up to the deal, even asking them to file briefs on who had authority to enforce the agreement.
On Wednesday, she conferred with attorneys from the governor's office and the companies.
Linda Barrett, senior deputy general counsel for the state, told the judge that Highmark and UPMC had agreed not to draw the mediators into any court fight. She said it would be up to Conti to interpret the agreement.
“I'm very disappointed that the governor wasn't willing to stand behind the results of the mediation,” Conti said before telling the attorneys to talk out their differences.
Corbett spokesman Jay Pagni said Highmark and UPMC asked for the governor's help as a neutral party and not an enforcer.
“We are disappointed by the judge's comments,” Pagni said. “This was about a contract extension, not any type of litigation.”
Conti will review the status of the case on Nov. 25, but lawyers for both sides said the lawsuits should be dismissed before then unless the West Penn board rejects the deal.
The proposed agreement wouldn't affect a third antitrust lawsuit naming both companies as defendants.
Royal Mile Co., a Whitehall property management company, Cole's Wexford Hotel Inc. of Pine and a customer claim that a conspiracy between Highmark and UPMC allowed Highmark to charge them excessive premiums. Conti on Sept. 27 threw out the second version of their complaint, giving them 30 days to file another or appeal the decision.
Scott Hare, an attorney for Royal Mile, said they haven't decided which option they'll pursue before the deadline on Monday.
Brian Bowling is a Trib Total Media staff writer. Reach him at 412-325-4301.
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.
- Woman shot at Kennywood Park in ‘freak accident’
- McCutchen, Pirates hitters increasingly in crosshairs
- Police: Maine man shoots off firework from top of head, dies
- Pirates minor league report: Ramirez more mindful while at plate
- Starting 9: Pirates missing out on young bat
- Locke pitches 8 scoreless innings as Pirates edge Indians
- Allentown mayor says he’s cooperating with federal probe
- Biertempfel: Loss of All-Star paper ballots a blow to nostalgia
- Pittsburgh’s tech startup activity rates last of 40 metro areas in report
- Starkey: Bring back the Brawl!
- Russian winger Plotnikov could join Penguins in August