Federal judge dismisses UPMC suit in Highmark split | TribLIVE.com
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Joe Napsha

The state attorney general won a round in federal court Wednesday in his ongoing battle to modify the soon-to-expire consent decree that gives numerous Highmark Inc. clients access to UPMC without paying higher out-of-network fees.

U.S. Judge John E. Jones granted Attorney General Joshua Shapiro’s motion to dismiss UPMC’s complaint against the state and dismissed UPMC’s motion for a preliminary injunction in the matter. Jones’ dismissal gives UPMC the right to appeal the decision to the 3rd Circuit Court of Appeals.

UPMC, through its Pinnacle health care system in Harrisburg, filed a petition in federal court in Harrisburg on Feb. 21 seeking to declare that Shapiro’s proposed modifications to the consent decree, which expires on June 30, are pre-empted by the Medicare Act, the Affordable Care Act and the federal law governing retirement income. UPMC claimed Shapiro’s attempt to modify the 2014 consent decree governing UPMC’s coverage of Highmark clients was unconstitutional.

Shapiro argued it is not yet time to judge UPMC’s claims because he has only asked Commonwealth Court to accept his proposed modifications and has not revealed to UPMC how he would make his new rules apply to all nonprofit health insurance providers. UPMC, however, said its claims are ready to be reviewed now because Shapiro’s statements suggest he will act without court approval.

Judge Jones, however, said he was not persuaded by UPMC’s claims that Shapiro would implement changes to rules governing nonprofit hospitals, even if Commonwealth Court rejects his modifications to the consent decree. Shapiro’s intentions are not law and if the court determined they were, courts would be “overwhelmed with ripe controversies anytime a politician opened his or her mouth,” Jones stated in his ruling.

UPMC spokesman Paul Wood declined to comment.

A state Commonwealth Court judge had ruled April 3 that Shapiro cannot get an indefinite extension of the June 30 split of UPMC and Highmark, a deadline that had been established in the 2014 consent between the two health care rivals. That ruling reinforced a state Supreme Court decision from 2018, which said it did not have the authority to modify the termination date of the consent decree.

Shapiro had sought to modify the terms of the consent decree through discussions with UPMC in November and December. The attorney general had argued that UPMC was not fulfilling its charitable obligations as a nonprofit health care institution.

UPMC filed its lawsuit while still battling Shapiro in Commonwealth Court over Shapiro’s petition on Feb. 7 asking Commonwealth Court for the authority to modify the consent decree.

Shapiro sought to make UPMC contract with all health insurers as part of its charitable obligations as a nonprofit medical institution.

The Commonwealth Court on April 17 placed a stay on the case in its court to allow UPMC and the Attorney General to concentrate on the time-sensitive appeal in the Supreme Court.

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