Highmark Inc.'s recent decision to charge Medicare customers $25 co-payments on certain injected drugs -- chemotherapy agents, immunosuppressants, anemia drugs and more -- is becoming a financial burden to a number of customers who require such injections several times a week.

"They're killing our patients," said Dr. James Bress, a South Side oncologist, speaking financially, not literally.

Highmark, Pittsburgh's dominant health insurer and a Medicare vendor, began a pilot program last year charging co-payments on certain oral drugs that fall under the umbrella of Medicare Advantage's Part B (Part D, meanwhile, is the Medicare benefit that covers most take-home prescription drugs).

This January, the policy, which affects Highmark's FreedomBlue and SecurityBlue supplements, expanded to include drugs injected in a doctor's office. Highmark spokesman Michael Weinstein said the new charges were needed to defray the rising cost of the injected drugs, which can run from $100 to $30,000 per dose, depending on the drug.

"These are an emerging area of medicine -- very high cost," Mr. Weinstein said. The institution of the co-payments meant that Highmark was able to forgo a $5-a-month premium hike.

The new co-payment is something that's been debated not only by Highmark, but also by insurers that offer Medicare Advantage programs across the country. They've been "searching to achieve the right balance between maintaining access to higher-cost drugs such as the injectables, while also trying to keep these programs in the face of rising medical costs resulting from new medical advances," Mr. Weinstein said in an e-mail.

But Highmark is balancing its pro forma on the backs of seniors with cancer, said Dr. Bress, to devastating effect.

A year ago, "they'd owe me $15 or $20 just to see the doctor. Now, every single chemo drug I give, Highmark gets a co-pay. Some of these patients will be forced to pay me anywhere from $100 to $150, and that may be two or three times a week."

And that's unacceptable, he said. He and a circle of Pittsburgh oncologists (including his brother, Dr. Alan Bress) plan to lobby their congressmen and senators, pushing for a policy change, he said.

Separately, another group of Highmark customers is having trouble getting their cancer treatments -- but not because of Highmark's new co-pay. It's because the University of Pittsburgh Medical Center is refusing to see them. UPMC is balking because of a dispute, playing out nationwide among providers, over drug reimbursement rates tied to a type of Medicare Advantage plan known as a private fee-for-service plan, offered through various insurers.

That means subscribers to Highmark's FreedomBlue fee-for-service package, all 18,000 members, are out of luck at UPMC's cancer clinics. It also means retired state employees, who have insurance through HealthAmerica's Advantra Freedom plan are being similarly denied service at UPMC's oncology sites, including the Hillman Cancer Center.

"UPMC Cancer Centers has decided that the centers will not provide medical oncology services to most Medicare Advantage private fee-for-service members, [because] of insufficient levels of drug reimbursement," said hospital system spokesman, Frank Raczkiewicz.

"Many providers nationwide have made similar decisions." (UPMC will continue to see these fee-for-service customers in other respects, just not for oncology treatments.)

Private fee-for-service plans are just one of many permutations of Medicare plans now available to seniors -- HMOs, PPOs and so on -- but these are wholly administered by private companies, which receive a subsidy from the federal government for offering the plans.

The private fee-for-service plans have quickly grown in popularity over the past three years, largely because the plans pay lower reimbursement rates than traditional Medicare plans, an incentive for insurance companies to encourage customer enrollment. Critics say it's a back-door way for government to privatize Medicare, and hospitals are beginning to object to the rigid reimbursement schedules.

The cancer treatment issues arise amid the continuing debate over the proposed mega-merger between Highmark Inc. and Philadelphia health insurer Independence Blue Cross.

In Harrisburg yesterday, at a House committee hearing, state Insurance Commissioner Joel Ario said the insurers should have an answer, affirmative or negative, by the end of 2008.

But he also cautioned that it's a difficult decision, with thousands of pages of paper being filed and many complicated issues involved. As a result, "the timetable may slip," he said.

Mr. Ario said that at least three public hearings -- one in Pittsburgh, one in Harrisburg and one in Philadelphia -- will be held, probably starting in July, so health-care consumers can weigh in on the merger.

"We want all the issues raised now so we can consider everything before we make a decision," he said.

Two major questions must be answered: Would consolidation of the two health insurers produce benefits, such as management efficiencies, that would lower costs for consumers? And will the Blues be amenable to continued, guaranteed contributions to the state in the form of "social mission" spending?

Mr. Ario also asked the House Committee to approve legislation that would give the Insurance Department greater authority over the holding companies for Highmark and IBC. The department currently has regulatory authority over some of the insurers' smaller, for-profit subsidiaries, but not Highmark and IBC themselves.

"We desperately need that authority to do a full review of this merger," he said. Legislative committees, the governor's office and the Blues have been exchanging feedback on a rough draft of the legislation that has been circulated among the interested parties, and the hope is that a final draft will be ready before the summer recess.