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Highmark's $1B Acquisition of West Penn Approved by PA

John Commins, for HealthLeaders Media, April 30, 2013

'Coupled with that we are very unique,' Paul says. 'This is the first time in this country where a very large insurer is entering into the provider business to the extent that we are here at Highmark. So our incentive is to be sure we keep care in the most affordable setting, keep care local, [and] make it very convenient for our enrollees. Thus we can keep that membership.'

The deal is the latest twist in the battle for market share in Western Pennsylvania with rival University of Pittsburgh Medical Center. Winkenwerder said Monday Highmark hopes to have a relationship with UPMC going forward, even though their current contract will expire at the end of the 2014.

UPMC appeared less enthusiastic and issued a statement following the commissioner's approval noting that 'Highmark's ownership of a provider network introduces more complicated insurance choices for employers and consumers.'

'We urge Highmark to immediately join with UPMC in preparing its subscribers for the transition that will take place on Dec. 31, 2014, when the UPMC-Highmark contract expires,' UPMC's statement read. 'It is important that consumers understand these changes so they can take the steps needed to continue accessing their preferred doctors and hospitals. We urge Highmark to work with UPMC now as there will be no new UPMC contract or extension when the current one expires in just 19 months.'

Monday's approval by Pennsylvania Insurance Commissioner Michael Consedine caps a process that began with Highmark's initial filing in November 2011 through its nonprofit corporation, UPE. Consedine called the review of the deal the most complex and extensive in his agency's history, with a record that includes more than 64,000 pages of reports and analytical data, more than 10,000 pages of public comments and more than six hours of public testimony.  

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3 comments on "Highmark's $1B Acquisition of West Penn Approved by PA"


Jack Jessop-Ellia (5/6/2013 at 8:48 AM)
I'm glad to see the WPAHS continuing to move forward. I'm interested to know how this will affect former employees.

J. Blake (5/2/2013 at 4:17 PM)
I would have preferred to see some of the $1B being used to lower premiums for the subscribers who paid that $1B to Highmark for their coverage. We just got our renewal notice for our small group with a 59.37% increase for FY 2013-2014 in our high-deductible plan. Over the past five years, we have seen huge yearly increases in our premiums, while we have decreased our benefits and increased deductibles and copays.

Arun K. Potdar (4/30/2013 at 10:21 AM)
This article just gives the news about acquisition. What benefits if any, a physician, employer or the patient (consumer) to expect? There will be only two major options to choose (Highmark & UPMC) from and in this era of small or no government political mindset, what regulatory oversight teeth Insurance Commissioner is going to show? Field days are ahead for the Insurer to consolidate and do what you please after elimination of completions. It is a bad decision for the patients and doctors all around. Income reduction for service providers and poor service at higher cost for consumers in spite of ACA implementations will be the result of this as history has shown. Forgot Ma Bell days? Airline Consolidation has done no favors to passengers; high cost and no services worth paying for is the result. Highmark will have to do lot for PR in terms of explanation of what its benefits are going to show up in the market Place. I wonder what Ralf Nader has to say about this?