Com v. UPMC, Appeal of Com. by A.G.

208 A.3d 898
Supreme Court of Pennsylvania·Decided May 28, 2019·No. 39 MAP 2019·Published·Cited by 40 cases

Opinions

JUSTICE WECHT

Before this Court is the latest manifestation of a longstanding dispute between UPMC; UPE, a/k/a Highmark Health and Highmark, Inc. (collectively, "Highmark");

*901and the Commonwealth's Office of the Attorney General ("OAG") regarding the parties' rights and obligations under a pair of Consent Decrees that, since 2014, have governed the relationship between UPMC and Highmark with regard to the provision and financing of certain healthcare services to their respective insurance subscribers. The Consent Decrees currently are scheduled to terminate on June 30, 2019.1

A thorough recitation of the circumstances leading to the drafting of the Consent Decrees may be found in this Court's first decision interpreting their provisions. See Commonwealth ex rel. Kane v. UPMC , 634 Pa. 97, 129 A.3d 441 (2015). Accordingly, we will not reproduce here the extensive background underlying this litigation. However, because our second case implicating the Consent Decrees, Commonwealth by Shapiro v. UPMC , 188 A.3d 1122 (Pa. 2018) (" Shapiro I "), features prominently in both the reasoning of the lower court and the arguments of the parties, a brief examination of that decision is warranted at the outset.

I. Shapiro I

At issue in Shapiro I was UPMC's obligation under the "Vulnerable Populations" provision of its Consent Decree to be "in a contract" with Highmark for the provision of healthcare services, at negotiated "In-Network" rates, to Highmark's Medicare Advantage ("MA") subscribers through the end date of the Consent Decrees, as required by our holding in Kane . See Kane , 129 A.3d at 469-70 ; Shapiro I , 188 A.3d at 1124.2 UPMC signaled its intent to rely upon a six-month "runout" provision of its existing MA Provider Agreements, which, by its terms, would obligate UPMC "to continue to abide by the same terms and conditions of the Provider Agreement for six months following the end of the final annual renewal period." Shapiro I , 188 A.3d at 1125. Under UPMC's understanding of its Consent Decree and this Court's decision in Kane , upon its termination of the Provider Agreements on December 31, 2018, the runout provision would be triggered, thus continuing to bind UPMC to all of their terms until June 30, 2019, upon which date UPMC would satisfy its obligations under its Consent Decree.

OAG filed a Petition to Enforce the Consent Decrees, averring that the runout provision was insufficient to satisfy UPMC's obligations, that the Provider Agreements therefore could not be terminated before June 30, 2019, and further that, because the Provider Agreements renewed *902on an annual basis, the earliest possible termination date would be December 31, 2019, with the runout provision then binding UPMC to their terms until June 30, 2020-one year beyond the end date of the Consent Decrees. The Commonwealth Court, in a single-judge order and memorandum, granted OAG's Petition to Enforce and ordered that UPMC would remain bound to the terms of the Provider Agreements through the end of the calendar year 2019.

UPMC appealed the Commonwealth Court's order to this Court, and we reversed. We held that UPMC's proposed invocation of the runout clause would satisfy its obligation to be "in a contract" with Highmark through June 30, 2019. Under the language of the runout provision, we noted, it "seems self-evident that UPMC is in a contract to provide in-network access during the first six months of 2019." Id. at 1134. When read as a whole, the Provider Agreements "mandate in-network access to UPMC facilities through the first half of 2019, thus satisfying the substantive requirement of the Consent Decree that UPMC 'treat those participants in Highmark [MA Plans] as In-Network.' " Id. at 1135 (quoting Kane , 129 A.3d at 469 ) (bracketed material in original; internal quotation marks omitted).

In a passage that is a subject of dispute in the instant case, this Court noted that our "primary hesitation" with the Commonwealth Court's order was that it "alters an unambiguous and material term of the Consent Decree-the June 30, 2019 end date." Id. at 1132. We found "no basis upon which to alter this unambiguous date, to which the parties agreed, and correspondingly, no foundation for ordering the renewal of the Provider Agreements for the entirety of the 2019 calendar year." Id. at 1134.

II. Background and Procedural History

Following our decision in Shapiro I , on February 7, 2019, OAG filed in the Commonwealth Court a four-count Petition to Modify Consent Decrees ("Petition"), thus commencing the instant litigation.3 Invoking its parens patriae authority, OAG centrally averred that UPMC has departed from its mission as a charitable nonprofit healthcare institution, and that, negotiations with UPMC having failed, court-ordered modifications to the Consent Decrees thus are necessary to protect the public interest. OAG's requested relief is grounded in the language of the Consent Decrees that contemplates modifications thereof, which, as set forth in UPMC's Consent Decree, provides as follows:

10. Modification - If the OAG, PID, DOH or UPMC believes that modification of this Consent Decree would be in the public interest, that party shall give notice to the other and the parties shall attempt to agree on a modification. If the parties agree on a modification, they shall jointly petition the Court to modify the Consent Decree. If the parties cannot agree on a modification, the party seeking modification may petition the Court for modification and shall bear the burden of persuasion that the requested modification is in the public interest.

UPMC Consent Decree § IV(C)(10) (the *903"Modification Provision").4 ,5

Free access — add to your briefcase to read the full text and ask questions with AI

Com v. UPMC, Appeal of Com. by A.G., 208 A.3d 898 (Pa. 2019).

208 A.3d 898 (Com v. UPMC, Appeal of Com. by A.G.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Geco Holding, LTD. v. West Penn Power Co.
Superior Court of Pennsylvania, 2026
Accent Developers v. West Penn Power
Superior Court of Pennsylvania, 2026
Foster, C. v. DNT Automotive Group
Superior Court of Pennsylvania, 2026
Cook, N. v. Philadelphia Federal Credit Union
2026 Pa. Super. 39 (Superior Court of Pennsylvania, 2026)
Mirabella, J. v. St. Joseph's University, and M.W.
Superior Court of Pennsylvania, 2026
Situs Properties v. Jenkins Court Realty
Superior Court of Pennsylvania, 2026
Egan, R. v. Allstate Property
Superior Court of Pennsylvania, 2025
D. Stark v. PA DOC
Commonwealth Court of Pennsylvania, 2025
B. Jones v. K. Varner
Commonwealth Court of Pennsylvania, 2025
Colin Branca v. Target Corp
Third Circuit, 2025
Stefano, h/w v. Whitehall Borough and PennDOT
Commonwealth Court of Pennsylvania, 2024
Castelli, A. v. Natural Lands Trust
Superior Court of Pennsylvania, 2024
The Huntington National Bank v. McNeely, M.
Superior Court of Pennsylvania, 2024
BRANCA v. TARGET CORPORATION
E.D. Pennsylvania, 2024
TANNOUS v. CABRINI UNIVERSITY
E.D. Pennsylvania, 2024
The Tenant Union Representative Network v. PA PUC
Commonwealth Court of Pennsylvania, 2024