Dive Brief:
- Allegheny Health Network, owned since 2013 by Highmark, is awaiting approval from Pennsylvania's Insurance Department for a proposed transfer of $175 million in funds from Highmark Inc. for renovations and upgrades.
- The health system anticipates that it will need to accommodate more patients next year, after Highmark health insurance enrollees are expected to lose in-network access at UPMC.
- The plans would include building outpatient medical centers and expanding emergency, trauma and women's health services in an effort to compete with UPMC.
Dive Insight:
The expansion plans for Allegheny Health Network are the latest development in the flap between Highmark and UPMC, currently at odds over their state-brokered consent decree that allows some Highmark customers to continue receiving in-network services at UPMC. That provision is set to expire at the end of this year.
Allegheny Health Network says it requires the capital investments because it expects a significant increase in patient volume when Highmark customers leave UPMC in order to find in-network care.
However, UPMC disputes Allegheny Health's estimates, suggesting to state officials that very few patients will change health systems rather than change insurers.
Objective onlookers suggest it's too soon to tell; consultant James McTiernan at Arthur J. Gallagher told Trib Total Media that the number of Highmark customers who can be expected to switch from UPMC to Allegheny Health will depend on how the UPMC/Highmark consent agreement is interpreted by state officials.