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PA Attorney General Appeals To State's High Court, Argues UPMC Is Abusing Tax-Exempt Status

The Pennsylvania Supreme Court building in Harrisburg.

Pennsylvania Attorney General Josh Shapiro is asking the state Supreme Court to extend in-network access for Highmark-insured patients at UPMC facilities beyond June 30.

In his appeal brief to the high court, the attorney general said that, “If the outcome of this issue is not determined by June 30, 2019, then the health and welfare of millions of Pennsylvanians will be impacted, some of whom will be endangered.”

Shapiro’s filing comes after the Commonwealth Court ruled last week that it lacked the authority to intervene between Highmark and UPMC, “even if it were in the public interest to do so.” Judge Robert Simpson said that was because the state’s high court had determined the date that people with Highmark insurance will lose in-network access to UPMC facilities.

Industry and legal experts have been expecting this issue to appear before Pennsylvania Supreme Court justices, ever since Shapiro filed the initial a legal action back in February.

Shapiro said that attempts to negotiate a new agreement between Highmark and UPMC failed, which he blamed on UPMC. In the appeal's brief, Shaprio argued that denying access to a large swath of the public is an abuse of UPMC’s tax-exempt, non-profit status.

“UPMC is a public charity whose harmful actions include closing its doors to out-of-network patients through prohibitive pricing and demands for upfront payment, and steering the public toward its insurance plan,” he wrote. “UPMC has represented that it intends to continue its conduct and keep enjoying its tax-exempt status as a nonprofit corporation subsidized by the very same people it chooses not to serve.”

This imbroglio began in 2012 when UPMC, the region’s largest health system, announced it would no longer accept Highmark insurance. The year prior, Highmark had acquired its own health care system. Up  to that point, UPMC was the only western Pennsylvania-based entity that had both health care services and insurance under one parent company.

In the appeal, Shapiro requested the court expedite the appeal process and that it set oral arguments for May 22. If this schedule isn’t possible, Shapiro asked to have the current consent decree continue past June until the situation can be resolved.

A UPMC spokeswoman said the health care provider has, “nothing to add,” when asked for a comment on the attorney general’s appeal. Last week, UPMC said that it agreed with the Commonwealth Court decision to not extend the consent decree.

Highmark did not immediately respond to requests for comment, but said after the Commonwealth Court decision that, “We continue to support the attorney general’s efforts because it’s in the best interest of the community.”

WESA recieves funding from both UPMC and Highmark. 

Sarah Boden covers health and science for 90.5 WESA. Before coming to Pittsburgh in November 2017, she was a reporter for Iowa Public Radio. As a contributor to the NPR-Kaiser Health News Member Station Reporting Project on Health Care in the States, Sarah's print and audio reporting frequently appears on NPR and KFF Health News.