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Highmark won't pay hospital rates for care in physician offices

Pittsburgh Tribune-Review, February 27, 2014

Health systems across the country are buying out private doctor practices and reclassifying them as hospital-outpatient departments — a move that critics say allows hospitals to bill higher rates without providing more sophisticated care. The problem has been particularly widespread with oncology practices, according to Highmark Inc., the largest health insurer in Pennsylvania, which on Wednesday fired the first shot in what's expected to be a major battle between insurers and hospitals over the controversial practice. Starting April 1, Highmark will stop reimbursing health systems at higher hospital-outpatient rates for cancer treatment performed in physician offices. The move may also cause a domino effect in the industry, observers said.