Highmark offers cheaper, UPMC-free plan

Insurer revives Community Blue

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Come January, Highmark Inc. is giving customers a first taste of life without UPMC.

Pittsburgh-based Highmark, Pennsylvania's largest health insurer, announced on Monday some of the details of its revived Community Blue, a new version of an old, select-network insurance product line.

The new version could offer premium discounts of up to 25 percent compared to plans that have full access to UPMC's hospitals and doctors, according to Highmark, although brokers are expecting a smaller discount.

The limited network product, available in Western Pennsylvania counties on Jan. 1, will be marketed both to group and individual customers, who will have access to what's being described as a lower-cost network of 50 hospitals and 7,600 physicians and specialists.

Most hospitals and doctors in the UPMC health care system, the region's largest, will be considered "out of network," however. A few of UPMC's specialty hospitals, such as Children's Hospital of Pittsburgh and Western Psychiatric Institute and Clinic, will be considered in-network, as will a few UPMC hospitals in distant counties.

But, for the most part, this plan could give Highmark customers -- and Highmark itself -- a glimpse of what its products might look like in 2015, when Highmark and UPMC are due to part ways. At that point, most UPMC facilities would be out-of-network for anyone with a commercially purchased Highmark plan.

Deborah Rice, Highmark's president of health services, said that despite the business community hand-wringing over the potential Highmark-UPMC breakup, this product "is not about Highmark vs. UPMC." It's about "a high-quality and lower-cost health insurance plan," she said, calling this the first of many new insurance plans that will be unveiled by Highmark.

Still, she noted, "the success of this [product] could be a predictor of how Highmark will fare" after 2014.

Highmark's old Community Blue plan was popular, but it was eliminated in 2002 when UPMC and Highmark agreed to a 10-year contract. When the two parties agreed to a contract extension earlier this year, through the end of 2014, part of that agreement was a deal that would allow Highmark to offer products in which UPMC hospitals were out-of-network.

Limited network plans, which give buyers a break on premiums by offering access to a smaller network of doctors and hospitals, are not new, and in some ways resemble the HMO plans from the 1990s.

But for Highmark customers, who have grown accustomed to universal access to all of the region's health care providers over the last decade, the absence of UPMC hospitals and doctors could be jarring.

Regardless, Highmark has to give its new network a test run to a limited number of customers before it becomes the company's default network, said Norm Kerr, of Buck Consultants' health and productivity division.

"This is going to be their product going to market," he said. "For now, I don't think there's going to be a big jump-in for Jan. 1."

But Highmark will use the ramp-up period to observe the product's reception, and to combat low price quotes from rival insurers.

The group plans are ready to be marketed for the coming open enrollment period, the windows in which companies and their employees negotiate and select new health plans. The pricing and benefit details of the individual plans are still being reviewed by the state Department of Insurance, but also should be ready for market by Jan. 1, Ms. Rice said.

To see which providers will be part of the Community Blue network, go to: http://pgne.ws/dBAZa

businessnews

Bill Toland: btoland@post-gazette.com or 412-263-2625.


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