House committee hears first testimony on Christiana bills

Dec. 19--HARRISBURG -- Members of the state House Health Committee heard testimony Wednesday on two health care bills sponsored by Rep. Jim Christiana that seek to remedy the contentious contract stalemate between UPMC and Highmark Inc.

Experts and executives from organizations and interest groups, including Pittsburgh's feuding health care giants, offered statements in support and opposition of House Bills 1621 and 1622, known together as the Patient Access and Consumer Choice Bills.

Christiana, R-15, Beaver, along with co-sponsor Rep. Dan Frankel, D-23, Pittsburgh, have said the legislation would protect patients when it comes to deciding where they receive their health care.

If enacted, the bills would settle the issues between Highmark and UPMC, by requiring hospitals and physicians in Integrated Delivery Networks (IDNs) -- health plans that also have hospitals, such as Highmark, UPMC and Geisinger Health System -- to contract with "any willing" insurer.

While some speakers called the bills anti-competitive, Christiana said they are about protecting patients who are at risk of losing access to their hospitals and doctors because of the logos on their insurance cards.

"We are blessed with some of the best doctors and nurses and research centers in the nation. To think that our citizens would be restricted from these state-of-the-art facilities and resources not because they don't have insurance but because they have the wrong insurance, to me, this is completely unacceptable," Christiana said in his opening statement.

The co-sponsors have said the state must create a fairer, more transparent health care system that encourages hospitals to compete based on value, rather than on market leverage.

"Patients should reap the benefits of clinical integration -- better coordinated care and increased efficiency -- but should be protected from the potential for collusion or other anti-competitive behavior leading to higher prices or restricted access," the legislators wrote in a co-sponsorship memorandum.

Frankel testified that in other industries, people can choose whether to buy something if it is worth their money. But with health care, "if someone is sick, they need to go to the hospital."

"Big hospitals with a lot of clout are demanding more money," Frankel told his fellow committee members. "We can't afford it anymore."

Highmark officials continued to express support for the bills. Health Plan President Deborah Rice-Johnson said Highmark believes families and individuals deserve to have their choice protected and urged committee members to approve the legislation.

Diane Holder, chief executive officer of UPMC Health Plan, said UPMC shares the goal of keeping health care affordable, but the bills will "freeze" the current system in place and get in the way of innovation.

"From our point of view, market competition is working, and we think it would be important to continue to let it work," Holder said in her testimony.

Holder and Tom McGough, UPMC's chief legal officer, both noted that major employers in the region such as Westinghouse, American Eagle Outfitters and Dick's Sporting Goods have already offered employees alternatives to Highmark insurance.

UPMC is fighting the legislation, arguing that it is anti-competitive and would draw antitrust scrutiny by forcing the two entities to work together.

"That combination would control virtually all of insurance and virtually all of health care in western Pennsylvania," McGough said.

In response to questions about a recent UPMC mailer that criticized Christiana for co-sponsoring the legislation, McGough said it was "well within the bounds" of what nonprofits are permitted to engage in for issue-related advocacy. He said UPMC sent the mailer to about 750 people in Christiana's district, whose addresses were acquired from many sources.

Christiana said on Wednesday afternoon that it was "very clear" from the hearing that UPMC

believes allowing the contract with Highmark to expire is in the best interest of western Pennsylvanians.

"But I believe it's the opposite," he said.

"If we don't allow patients to move throughout different hospital networks, if we don't allow those types of options ... we're going to have two competing systems spending billions of dollars building identical networks," Christiana added. "That is truly a waste."

Charles Davidson, president of MCA Administrators, a benefits management

company in Pittsburgh, testified that the legislation does not go far enough.

Davidson said the language in the bills should apply not only to any willing insurance carrier, but to "any payer," so that self-insured employers, union insurance plans or uninsured individuals are afforded the same discounts that insurance companies are afforded.

"The way this bill is written, it doesn't protect them," he said.

Davidson said legislators also should broaden the bills to apply to all providers instead of just IDNs, in case a health care system would decide to part ways with its health plan arm.

"You need to be regulating what providers charge to people, not just (IDNs)," he said.

Christiana said the legislation is not a "silver bullet" for the entire health care industry, but he felt that a lot of good perspectives were brought up at the hearing.

One thing Christiana said he was pleased to hear was that Geisinger -- the oldest IDN in the state -- contracts with other health systems in central Pennsylvania, even allowing insurance customers to go to competing hospitals and doctors.

Frank Trembulak, executive vice president and chief operating officer of Geisinger, said the health system is opposed to the legislation, not because it doesn't want to contract with other providers, but because it would stifle its attempts to reform "historic" health care payment systems.

"The patient has the ultimate control to pick the best health care for them," Christiana said of Geisinger's health plan. "I think that's the responsible approach that I believe Highmark is trying to achieve, and that's ... the type of approach that UPMC is opposing."

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