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House Co-Sponsorship Memoranda
House of Representatives
Session of 2013 - 2014
Regular Session
MEMORANDUM
| Posted: | January 15, 2014 03:41 PM |
|---|---|
| From: | Representative Anthony M. DeLuca |
| To: | All House members |
| Subject: | Powers of the Insurance Commissioner in Contract Disputes between Insurers and Health Systems |
| In the near future, I will introduce legislation addressing the ongoing contract disputes between UPMC and Highmark. This legislation is similar to House Bill 2052 (Vulakovich) from last session, which passed in the House by a vote of 186-6. Currently, under Act 94 of 1975, the Insurance Department has the authority to step into a contract termination dispute between a hospital and a Blue Cross licensee and determine whether termination of a contract is recommended. My bill will expand these powers to include both contract terminations and expirations, if the dispute involves a health system and any health insurer. Specifically, the legislation will enable to the Commissioner to bring health insurers and large health systems back to the table. In the event that a failure to reach an agreement would significantly disrupt access to medical care in the region, the Commissioner would have the power to force the parties into mediation and, if necessary, binding arbitration. The ongoing dispute between Highmark and UPMC has left the citizens of western Pennsylvania who carry Highmark health insurance cards scared and in need of answers. This dispute demonstrates the problems that can arise when a single health system dominates a region’s health care provider market. Large health systems can exert tremendous and unfair leverage over traditional insurers due to their unique business structure. Left unregulated, these large health systems may easily monopolize a region’s health care provider market, eliminating competition and increasing health care costs. While the Commonwealth was able to get UPMC to extend their contract with Highmark for one year, the contract expired on June 30, 2013 and existing Highmark cardholders will lose all access to their UPMC providers as of January 1, 2015. This will leave Highmark subscribers to fend for themselves, and require them to find adequate substitutes for the medical care, which may not exist in the region. It’s time for the legislature and the Governor to be proactive and propose a sensible solution to this very real and pressing problem. I ask you to join me in co-sponsoring a bill that addresses a very important, non-partisan issue that could affect three million subscribers in the western Pennsylvania region. |
Introduced as HB1964