UPMC says it’s eclipsed Highmark in Medicare Advantage insurance market, Aetna gains

Feb. 28-- Feb. 28--UPMC boasted this week that the health system's insurance arm has eclipsed Pittsburgh-based rival Highmark in attracting Medicare Advantage insurance members and now dominates that market in Western Pennsylvania.

"We've grown dramatically," said Diane Holder, president of UPMC's Insurance Services Division. "We are now the largest provider of Medicare Advantage in Western Pennsylvania."

UPMC says it has secured 37 percent of the market share and has about 50,000 more seniors and people with disabilities than Highmark enrolled in Medicare Advantage plans, the privately offered alternatives to traditional Medicare and Medigap coverage.

This past fall alone, UPMC reported its second-best year in Medicare Advantage sales, netting 8,000 additional members for 2019 than last year, according to figures provided by UPMC in its year-end financial updates.

Highmark lost a net of 21,000 members during the same enrollment period, UPMC's figures show.

Those figures still could change. People enrolled in a 2019 Medicare Advantage plan have the ability to switch to another MA plan through March 31.

Summer split spurs major shifts

UPMC executives said that a major reason for this past fall's rampant plan-switching -- including an uptick in people shying away from Highmark and choosing national alternatives like Aetna -- was people's concerns over which doctors they could see once UPMC and Highmark's networks split this summer.

Highmark spokesman Aaron Billger said he would not comment or "speculate on data points presented by UPMC."

He said Highmark plans to release its year-end financial information and updated insurance membership figures in mid-March.

Aetna achieved the highest gains during the MA enrollment period that ended Dec. 7, adding a net of nearly 20,000 Medicare Advantage members, UPMC's figures show.

Insurance brokers told the Tribune-Review that Aetna and other national plans appealto many customers because they'll remain in-network at UPMC facilities when Highmark patients do not.

A 2014 state-brokered consent decree between the two nonprofit health care giants is scheduled to expire on June 30.

Complicating matters for thousands of confused seniors was a new prepayment-in-full rule that UPMC announced in October. Starting July 1, out-of-network patients, such as those insured by Highmark, must prepay in full and will be billed directly for all nonemergency services at most UPMC facilities. (Exceptions, at least through 2020, include hospitals in rural or underserved areas and places such as Western Psych and Children's Hospital of Pittsburgh.)

"The big thing really had to do with what doctors and hospitals do you expect to have in your network. People knew the consent decree was ending in June," Holder said. "So that's certainly moving some market share. And the lion's share of that market share went to the nationals (insurers) this year, but we still picked up one of our highest enrollment years."

Market domination in 5 years

Five years ago, Highmark had a commanding 46.5 percent of the Medicare Advantage market share to UPMC's 27.6 percent, according to UPMC's figures.

But between 2014 and this past fall, UPMC gained 63,400 members enrolled in Medicare Advantage plans. That makes for a total membership of 187,000 and increase of 51 percent, data provided by UPMC show.

During the same period, Highmark experienced a net loss of 75,400 Medicare Advantage insurance plans, for a total current membership of 132,500 -- a 36 percent drop, according to UPMC's figures.

In 2019, UPMC dominates the field with 37 percent of the market share to Highmark's 26.2 percent, UPMC says.

Highmark had closer to 75 percent of the market share in the early 2000s, prior to when UPMC began offering Medicare Advantage plans in 2004.

The field also has grown more crowded, with national insurers Aetna and United increasingly targeting the region as Medicare Advantage plans spike in popularity nationwide. People enjoy MA plans for $0 or lower monthly premiums than traditional Medicare, lower deductibles and perks such as transportation to health appointments and access to SilverSneakers classes.

"What was true in Pittsburgh was a pretty consolidated market in terms of insurance. I think now we have a very competitive market in insurance, I would say one of the most," Holder said. "It's kept Medicare Advantage very healthy. ... There were more plans offered in (the) Pittsburgh market this year than any year in its history."

Aetna now covers about 23 percent of the Medicare Advantage market with about 115,791 members, for a 49.4 percent increase over the past five years.

UnitedHealthcare has climbed to nearly 28,000 members -- an 854 percent increase from 2014, when United had just 3,200 members.

Though UPMC officials still see more room for growth, Holder pointed out that 50 percent to 60 percent of eligible people in Western Pennsylvania already choose Medicare Advantage plans over traditional and supplemental Medicare coverage issued directly by the federal government. Nationally, closer to 30 percent of eligible people enroll in MA plans.

"So we are among the highest in the nation where people choose Medicare advantage insurance plans," she said. "There has been healthy insurance competition and that has helped drop the consumer's bottom line."

UPMC balks at AG Shapiro's intervention

This month, Pennsylvania Attorney General Josh Shapiro filed a petition to modify the Highmark-UPMC consent decree to halt the looming breakup and its impact on the likes of seniors and patients with cancer. He demanded, among other things, that UPMC drop its prepay rule and agree to accept Highmark and any other out-of-network patients at affordable rates "in perpetuity."

He accused UPMC of breach of fiduciary duties and violating laws regarding charities, unfair trade and consumer protection.

Last week, UPMC fired back by asking state Commonwealth Court to dismiss Shapiro's petition "in its entirety." The same day, UPMC filed a federal lawsuit alleging that Shapiro is overstepping his authority and threatening to "upend" the entire health care market by "delegating price-fixing to self-interested, private parties."

On Tuesday, UPMC Chief Financial Officer Robert DeMichiei said he would not discuss pending legal issues but asserted that Shapiro's efforts will "have no impact whatsoever" on the "patient experience."

"We have filed our case and we're going to let judicial system take its course," DeMichiei said.

Natasha Lindstrom is a Tribune-Review staff writer. You can contact Natasha at 412-380-8514, [email protected] or via Twitter .

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