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UPMC-Highmark feud metastasizes in Westmoreland cancer center billing dispute

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Arnold Palmer Cancer Pavilion

• $5.1 million in charitable cancer care provided there since 2002.

• $410 million in healthcare expenditure brought to the region since 2002.

• Total payroll is $88 million.

• 103 employees

• More than 50 clinical trials going on there right now

• $7.3 million dollars in Capital Investments

Source: Excela Health

By Richard Gazarik
Friday, Sept. 13, 2013, 12:01 a.m.

The feud between Highmark and UPMC has spilled over to Westmoreland County's Arnold Palmer Cancer Pavilion — a joint UPMC-Excela Health venture — where officials say Highmark is refusing to pay reimbursements for chemotherapy treatments.

But Highmark officials say they are not issuing reimbursements because the cancer center is billing the insurer as if the treatments were administered at a hospital nearly 25 miles away.

Excela Chief Executive Officer Robert Rogalski said the insurance giant hasn't paid the health system since March, forcing it to redirect money from other operations to the center.

None of the parties involved will divulge the exact amount of money in question.

“Highmark has paid zero dollars since March,” Rogalski said. “It's a significant amount of money. It's millions of dollars. It's draining our cash from the operation … . ”

But Highmark spokesman Michael Weinstein said the reason the company has refused to pay is because the cancer center is billing the insurer as if its patients receiving infusion chemotherapy by port, needle or catheter at UPMC-McKeesport.

Weinstein said cancer treatments performed at a hospital garner higher reimbursements than those done at outpatient facilities such as the Arnold Palmer Pavilion.

“Why is that important? It's important because the amount of money Highmark, and I assume other insurance companies, would pay for services, would be triple the amount we now pay,” he said.

Weinstein said that if Highmark permitted all of its customers to bill in this manner, it could increase costs to employers and patients by an additional $25 million annually.

“Highmark is ready and willing to pay these bills if UPMC submits them the way the center has historically billed us for those service,” Weinstein said.

UPMC officials also lashed out at Highmark.

“Highmark, once again, is showing little regard for quality by denying the claims of these patients,” said UPMC spokeswoman Jennifer C. Yates.

“Other insurers are recognizing this facility as a hospital-based clinic and this is just another way that Highmark is hurting community hospitals,” she said.

“Most of our oncology services are provided through hospital-based practices — as they are at most major medical centers across the country,” Yates added. “The Arnold Palmer Cancer Center provides the highest in patient care and meets the highest standards in quality because of its conversion to a hospital-based clinic.”

UPMC provides staff at the Arnold Palmer Pavilion and Excela owns the property, Rogalski said. About 130 patients a day are treated at the facility where UPMC and Excela equally share costs and revenue.

Rogalski said Highmark is paying reimbursements for all other services provided at the center, including radiation treatments.

UPMC last year notified Highmark it was shifting billing for chemotherapy to UPMC-McKeesport, he said.

Rogalski said UPMC changed the way it submits bills to Highmark because the treatment patients receive at Palmer is the same as at a hospital.

“The change is not unusual,” he said. “Every other cancer center in the region is paid this way.”

Weinstein disputes that.

“Nobody was given notice of change in the way chemotherapy infusion services was billed. Highmark learned of it when it began to receive claims,” he said. “We started to see the same services are being billed differently because it adds much more to costs.

“We recognize the financial concerns all hospitals are facing and are looking for ways to increase revenue,” Weinstein said.

Rogalski said he is negotiating with Highmark to resolve the reimbursement issue in hopes of avoiding a legal entanglement.

He added that he does not expect any cutbacks at the center as a result of the reimbursement battle.

Richard Gazarik is a staff writer for Trib Total Media. He can be reached at 724-830-6292 or at

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