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Highmark sues UPMC for cancer treatment billing practices

Highmark sues UPMC for cancer treatment billing practices

Originally Posted by Justine Coyne of the Pittsburgh Business Times on The Business Journals

Highmark Inc. has filed a lawsuit against UPMC alleging the health care provider used improper billing practices to “substantially” inflate rates Highmark and Keystone Health Plan West Inc. paid for UPMC’s oncology services.

Courtesy of American City Business Journals

The lawsuit was filed Wednesday in the Allegheny County Court of Common Pleas.

“Beginning in approximately August 2010 and continuing through the present, Defendants and affiliated entities or persons concocted a scheme to avoid establish contractual arrangements in order to charge Highmark and KHPW, their customers, and their members significantly higher prices for oncology drugs and related oncology services,” the lawsuit said.

As a result, Highmark said UPMC has “profited enormously” by unilaterally shifting the billing of claims of these services from established physician-based billing to billing the charges at higher hospital outpatient rates.

Highmark and KHPW argue they have been injured by having to pay a significantly higher rate and are asking for reimbursement.

“Highmark is taking legal action in a continued effort to safeguard cancer patients from irrational billing practices,” said Highmark spokesman Aaron Billger.

As a result of UPMC’s billing practices, Billinger said patients covered by Highmark have been overbilled more than $300 million over the last three years. He said throughout the same period there has been no increase in the quality of care patients received.

At the end of February, Highmark changed the way cancer care could be billed, announcing it would no longer pay facility fees, or markups for rendering cancer care in a hospital outpatient center rather than a doctor’s office.

Billinger said it was able to address the issue through contracting with individual hospitals, but because UPMC “decided to close the door,” Highmark was unable to address the issue through contracting.

“Highmark’s latest lawsuit is not only a meritless attack on a reimbursement system Highmark itself designed and endorsed, but also a blatant violation of the Consent Decree it entered with the Commonwealth of Pennsylvania just two months ago,” UPMC spokesman Paul Wood said in a statement. “Under that decree, Highmark is required to use its ‘best efforts’ to resolve these specific claims through arbitration by the end of this year… Highmark is clearly attempting to forestall a negative decision in that arbitration.”

UPMC will seek appropriate relief in the pending arbitration in Commonwealth Court and the Court of Common Pleas where Highmark’s latest action has been filed, Wood continued.

“It should be noted that Highmark’s own Allegheny Health Network has long engaged in these same billing practices, making this lawsuit another in the long line of duplicitous acts and bad behavior by Highmark,” he said.