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West Penn Allegheny Health System Files Lawsuit Charging UPMC, Highmark with Conspiracy, Antitrust

Posted on: Wednesday, 22 April 2009, 07:27 CDT

Suit Charges Companies Exploited Community, Overcharging Employers and Driving Up Healthcare Costs

PITTSBURGH, April 22 /PRNewswire-USNewswire/ -- West Penn Allegheny Health System (WPAHS) yesterday filed a complaint in United States District Court against UPMC, Pittsburgh's dominant hospital system, and Highmark, Inc., Pittsburgh's dominant health insurer, alleging that the two parties "have conspired to protect one another from competition," with the result that "an increasingly exploited Pittsburgh community has suffered rising health care costs."

"We file this action to bring to light and to rectify a situation that has harmed the West Penn Allegheny Health System and the entire Western Pennsylvania community," said David L. McClenahan, Chairman of the Board of Directors of West Penn Allegheny Health System. "We believe that for several years UPMC and Highmark have engaged in mutual back-scratching designed to preserve Highmark's monopoly in health insurance and to permit UPMC to build a monopoly in sophisticated tertiary and quaternary healthcare in this region. In healthcare, as in all industries, monopolies hurt everyone except the monopolists because they tend inevitably to increase the price and reduce the quality of the product."

In 2006 West Penn Allegheny filed a complaint with the U.S. Department of Justice regarding the unholy arrangement between Highmark and UPMC, and that matter continues to be investigated by DOJ, Mr. McClenahan said. The complaint in the U.S. District Court requests that the conduct of these dominant players in the healthcare market be examined before a jury, that the Court order Highmark and UPMC to end their predatory conduct, and that appropriate damages be awarded to West Penn Allegheny.

"West Penn Allegheny continues to make significant progress in transforming the System through the integration of its services and the establishment of a physician-led organization. The purpose of WPAHS has been and will always be to improve the health of the people of western Pennsylvania. This commitment will not be diminished by organizations that are interested first and foremost in dominating the marketplace," Mr. McClenahan said.

The complete text of this civil complaint may be found online at: www.wpahs.org/antitrustfiling.pdf.

SOURCE West Penn Allegheny Health System

Source: PR Newswire

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