UPMC sues Highmark over advertising campaign
By Timothy Puko and David Conti
Published: Monday, Aug. 5, 2013, 3:42 p.m.
A Highmark television advertising campaign has become the latest episode in a long-running court feud with UPMC.
UPMC accused Highmark in a federal lawsuit on Monday of running commercials that make false claims that its hospitals won't admit the insurer's customers. UPMC, Western Pennsylvania's largest hospital system, wants the commercials to be stopped.
“False and misleading statements denigrating UPMC now, in this environment, will irreparably harm UPMC,” the lawsuit alleges.
The lawsuit claims Highmark, the state's biggest health insurer, is unfairly trying to lure customers to its Allegheny Health Network. Highmark recently formed the hospital network to compete with UPMC when it acquired West Penn Allegheny Health System and two other hospitals.
The commercials are “the latest example of its long-running pattern and practice of Highmark seeking to harm and harming UPMC's business interests,” UPMC alleged in the lawsuit, which was filed in U.S. District Court in Pittsburgh.
Downtown-based Highmark Health Services plans to fight the lawsuit, said spokesman Aaron Billger. The insurer started the campaign because it believes UPMC is misleading people about contract negotiations between the two organizations.
“UPMC ignores the reality that its exorbitant charges for hospital services will preclude use of UPMC facilities by Highmark members unless there is a contract between the two organizations that makes care affordable,” he said. “No single health care organization should have the power to dictate where you can seek affordable medical care.”
The nonprofits have been in a major public battle since June 2011 — including several court cases — when Highmark said it was planning to buy West Penn Allegheny, UPMC's chief rival.
UPMC has refused to renew the reimbursement contracts with Highmark that expire at the end of 2014 because it says the insurer has converted itself into a direct competitor in the hospital business. UPMC countered by signing deals with several other insurance companies and expanding its own insurance service.
It isn't the first time they have gone to court over commercials. Highmark once accused UPMC of false advertising and claimed that UPMC unfairly denied service to Highmark members who subscribed to a limited network health plan called Community Blue.
Separately, UPMC has accused Highmark of not following through on a promise to drop a lawsuit that West Penn Allegheny filed in 2009 claiming UPMC had tried to use its market power to stifle the ailing hospital system.
Highmark customers will be able to use UPMC facilities after 2014 but will have to pay higher costs in most cases. Both companies had said about 200,000 seniors in Highmark's Medicare Advantage program would not have their access to UPMC facilities affected, but a Highmark spokesman recently said nothing has been decided on what happens after 2014.
Highmark's commercials slam UPMC, suggesting it will tell Highmark customers they're “not allowed to go there.” They feature seniors complaining that UPMC fears competition, using the terms “monopoly” and “community asset.”
UPMC spokesman Paul Wood said the hospital system in July sent a letter to Highmark seeking an end to ads, and the insurer responded that it would stop that campaign. The hospital sent another letter on Thursday with new complaints and gave Highmark until Monday to respond.
“UPMC was forced to file a lawsuit against Highmark to expose and stop the numerous deceptions in Highmark's current advertising campaign,” Wood said.
Highmark said UPMC started it. UPMC did run the first commercials in the most recent ad war, in which actors complain that Highmark officials are pushing them to change hospitals.
“The irony is that UPMC runs misleading ads and then takes legal action against Highmark Health Services to try to stop it from informing the public about the threat to the community's health care choice,” Billger said. “We plan to aggressively defend UPMC's allegations about our ads.”
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