This week has seen a flurry UPMC v. Highmark activity. Namely, after months of anticipation and delays, Highmark and WPAHS finally sealed the deal and signed their Affiliation Agreement. The Pennsylvania Insurance Commissioner, the Pennsylvania Attorney General, and the Internal Revenue Service (IRS) will review the proposed affiliation, so there are still a number of bridges to cross before the deal is final.
Public input is a necessary part of the review process, and Commissioner Consedine has committed to host two public hearings in Western Pennsylvania as part of the review. Members of the general public and interested parties can review agreement documents and submit public comment at the Pennsylvania Insurance Department website.
Instead of attempting to summarize the entire agreement, I want to share two observations in particular. First, I have referenced the need for intervention by public officials, to remedy a Western Pennsylvania health care market that appears to be broken. Interestingly, the counter argument suggests that if the Highmark-WPAHS deal succeeds, it just might be unique enough to constitute a private market solution.
Maybe it's simply the case that drastic times and markets call for drastic measures and maneuvers. Necessity is the mother of invention, so to speak.
Second, I found Tab E of the Affiliation Agreement particularly interesting. It describes Highmark's Vision at length, specifically within the context of the need for their Affiliation. The document lists several reasons "Why the System Needs to Change," including "Overinvestment in physical assets and clinical technology." (page 11).
Pennsylvania is one of 13 states that no longer maintains a state Certificate of Need (CON) program to regulate the capital investments of health care providers. I believe that Pennsylvania needs to reinvent and implement a new CON program, to meet the demands of the modern health care market place, while prioritizing and the health needs of communities. It seems that its Affiliation with WPAHS is leading Highmark to a similar conclusion.