Highmark/UPMC feud threatens student insurance

Credit: Adelaide Cole/Art Editor Credit: Adelaide Cole/Art Editor

The contract between Highmark and UPMC, allowing those under Highmark’s insurance to use UPMC facilities, will terminate on June 30, 2013. Carnegie Mellon students with Carnegie Mellon’s Highmark health insurance plan will be unable to use the local UPMC facilities after the termination.

Carnegie Mellon’s Health Services department has sent out a request for proposals (RFP) in anticipation of the contract’s end. An RFP invites health insurance companies to submit proposals so that the university can select one of them as its new health insurance company.

“There is some sense now that that agreement will not only cover to ... 2013, but will run into 2014. But that said, we weren’t in that place when we made the decision to send out a RFP,” said Anita Barkin, the director of university health services.

Barkin said that Health Services invited twenty insurance carriers and brokers to submit, but only four responded with proposals: Highmark, UPMC, Aetna, and United Healthcare.

“Aetna and United Healthcare now have contracts with UPMC. That was not the case in the past,” Barkin said. “So I think that was also a reason why Aetna and United were interested in providing a proposal for our student health insurance program, and that was because now UPMC facilities are part of their network.”

According to the Pittsburgh Post-Gazette, UPMC refuses to negotiate for a new contract with Highmark because Highmark is in the process of acquiring the West Penn Allegheny system of hospitals, UPMC’s only competition in the Pittsburgh area.

UPMC CEO Jeffrey Romoff told the Pittsburgh Tribune-Review that UPMC couldn’t contract with Highmark if the company acquires the West Penn Allegheny system. “A new contract would allow Highmark to steer patients away from UPMC’s facilities and doctors,” Romoff said.

Some students believe that might be a good thing. “I think that the monopoly UPMC has on healthcare in Pittsburgh is raising the price of healthcare overall,” said Katherine Forsyth, a junior biology and history double major.

Junior electrical and computer engineering and computer science double major Faith Clayton said that the extended contract is “postponing the inevitable.”

Barkin said that Carnegie Mellon’s Health Services department is more concerned with getting a plan that will cover both local and international facilities.

“For us, it boils down to having access to UPMC facilities because that’s where [the students] live. That’s the easiest facilities to access and that’s the largest network that wraps around where [the students] live,” Barkin said. “Beyond that, we need a pretty broad network because our students travel everywhere. So we need access to the local facilities and access to a very broad network and we need it at the very best prices we can get it.”

In the past, Carnegie Mellon Health Services awarded the students’ health insurance contract to Highmark because students responded that they had a very high level of satisfaction with the company. According to Barkin, Health Services has also been satisfied: Their claims get paid promptly, the students get coverage inside and outside of Pittsburgh, and there have been no disputes over payment.

However, Barkin said that if, in the future, UPMC is not part of Highmark’s program, it would be very unlikely for the university to stay with the company.

“We don’t want to take a chance of not having access to UPMC,” Barkin said.