Competition sparks payer-provider divorce


Pittsburgh-based Highmark Blue Cross Blue Shield and the University of Pittsburgh Medical Center (UPMC) are calling it quits after decades of working together.

Competition among healthcare insurers and providers, spurred by the Affordable Care Act, have sparked this separation, as more and more insurers are making moves to become healthcare providers, reports NPR

Because the ACA now dictates precisely which services insurers must provide, as well as who they insure, many insurers are adding their two cents to the industry by providing new, innovative methods of care.

Cue the trending accountable care organizations, which may be blurring the line between healthcare insurers and providers across the country. Both insurers and providers are entering into each other's businesses. But why? Competition.

Highmark purchased UPMC's main competitor, West Penn Allegheny Health System, with the intention to establish a healthier competition among providers, Highmark President and CEO David Holmberg told NPR.

But UPMC refused to resign it's contract with Highmark, claiming it could not compete with the insurer given the current market.

The payer-provider relationship has been on the rocks for quite some time. In a recent survey examining whether hospitals had an agreeable relationship with their insurers, the findings were dismal--on a scale of 1 to 100, with 100 the top score, insurers scored an average of 53.2, FierceHealthPayer previously reported.

But despite some less-than-positive news as of late, perhaps not all hope is lost for for a successful payer-provider marriage.

Late last month, healthcare giant Kaiser Permanente announced its new partnership with Johns Hopkins Medicine to effectively share data from electronic medical records and develop better models for delivering care, FierceEMR previously reported.

For more:
- here's the NPR piece

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