In an earlier post (here), we outlined how the cost of physician care can go up when a practice is purchased by a hospital system. Long have we wondered when Washington would stand up and challenge this concept. Once again, it is proven that looking to Washington to take the lead is often a bad idea.
Instead, watch the private market.
Now Highmark, the BCBS of Pennsylvania and the largest commercial payer in that state, has said that starting April 1, they simply will not pay the facility fee tacked onto claims from hospital-employed physician practices. Period.
Company officials say this will amount to $200 million in annual savings. Even for a payer with tall shiny buildings, that is a big enough number to be interesting.
Stepping back, it makes you question what took so long.
UPMC, one of the largest health systems in the country, is crying foul. In case you did not know, the P in UPMC stands for Pittsburgh, which means the Highmark decision is not theoretical for them.
UPMC also employs a boatload of physicians. They said they expect to be paid, per their contract, which includes the hospital facility fee that gets added to their physician claims.
Highmark is big and has lawyers. UPMC is big and has lawyers as well. The patients are small, so here’s hoping they don’t get cold-cocked by a stray left hook in this brawl, but I’d suggest they prepare to duck.
There is going to be a fight, so grab some popcorn and pull up a chair. Fortunately, you don’t have to shell out $49 for the pay-per-view to watch this one.