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Pros, cons found in merger of Highmark, WPAHS

April 10, 2013

While raising doubts about Highmark's ability to direct enough patients to West Penn Allegheny Health System to stabilize the financially ailing system, two consultants' reports say the insurer's planned acquisition of WPAHS presents "a reasonable economic basis for substantial benefits to the public in the form of improved delivery of care, reduced rate of increase in health care costs, and enhanced competition, particularly in the hospital sector." The good news for Highmark and WPAHS is that the consultants believe "the transaction on its own is not likely to jeopardize Highmark's financial stability," although it remains possible that "adverse operational and financial conditions caused by unforeseen external circumstances [could] materially lessen Highmark's financial flexibility."

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