Dive Brief:
- Highmark Blue Cross has lost its contract with the North Allegheny School District of greater Pittsburgh, which is mostly its 1,041 full-time employees and dependents to UnitedHealthcare.
- The loss springs from Highmark's conflict with the University of Pittsburgh Medical Center, which is set to pull out of Highmark's network by the end of the year, limiting provider access for Highmark members.
- UPMC is exiting its relationship with Highmark, in part, because the two have not managed to agree on pricing. UPMC is also upset that it is being forced to compete with Highmark's own Allegheny Health Network, the academic medical center's largest competitor in the region.
Dive Insight:
Despite concerns over lack of access to prominent specialists at UPMC, Highmark is generally holding its own; for example, it has kept key group contracts with employers, including Allegheny County's 15,000 public employees and their dependents. And it's a good thing for Highmark that it lost the the School District to UnitedHealthcare rather than the UPMC Health Plan.
Still, it does seem likely that Highmark will face some serious challenges in keeping customers over the longer term, as UPMC does have tremendous reach in the region. For example, the School District noted that if it hadn't shifted to UnitedHealthcare, staff would have lost 60% of its access in care provided by local physicians at nearby locations such as UPMC Passavant and Magee-Womens Hospital.
Highmark's Allegheny Health Network may contain some fine providers, but it seems that some customers won't be satisfied with it unless UPMC is part of the team.
Want to read more? You may enjoy this story about the Highmark gamble and the risks of hospital-insurer integration.