Allegheny County Court Rules UPMC/Highmark Agreements Trump Consent Decrees

The ruling by Judge Ward of the Allegheny County Court of Common Pleas highlights another facet of the ongoing dispute between UPMC and Highmark.

On February 18, 2015, Judge Ward of the Allegheny County Court of Common Pleas ruled that the arbitration agreements contained in the various agreements between Highmark and UPMC hospitals, most of which have separate participation agreements with Highmark and which each contain substantially identical arbitration provisions, apply to the disputes between the parties and are not preempted by the Consent Decrees that each of those parties have entered into with the Commonwealth of Pennsylvania.

One of the key points is that each of the parties have entered into separate Consent Decrees with the Commonwealth.  As you may recall, it was reported that separate Consent Decrees were created because the parties would not negotiate together.

Now the Allegheny County Court of Common Pleas is ruling that the Consent Decrees are not agreements between the two parties; instead they are agreements between the separate parties and the Commonwealth.  On the other hand, the various hospital participation agreements are agreements between the parties and in those agreements the parties have agreed to certain arbitration provisions.  The Court stated as follows:

UPMC appears to contend that the Consent Decree operates as an amendment to the agreements between Highmark and UPMC.  UPMC further argues that the Consent Decrees, in addition to amending the parties written agreements, also divest this court of jurisdiction to interpret the agreements.  The Consent Decrees, however, do not purport to amend the parties’ agreements, nor could they.  The Consent Decrees are agreements between UPMC and the Commonwealth of Pennsylvania and Highmark and the Commonwealth of Pennsylvania, respectively.  Accordingly, they do not deprive this Court of jurisdiction.

Peer Review Privilege: Facts vs. Conclusions

All states have some degree of confidentiality protection for peer review activities and the information generated by those activities, and there is additional federal protection for information gathered and created by Patient Safety Organizations (PSOs), established pursuant to the Patient Safety and Quality Improvement Act (PSQIA) of 2005.

However, physicians, hospitals, and medical staffs should not cavalierly rely upon assumed confidentiality for the protection of the information generated and collected by various peer review organizations or bodies.  In a number of pervious Med Law Blog posts, I have noted that incident reports, information collected for risk management purposes, and other types of non-peer review activity does not qualify for peer review confidentiality unless the information is generated by the peer review activity for a legitimate peer review purpose.

In Krusac v. Covenant Medical Center, Inc., (2015 Michigan Lexis 923), the Michigan Supreme Court held that, “objective facts gathered contemporaneously with an event” are not entitled to privilege under Michigan’s peer review privilege statutes.

The lesson is that one should not assume that all information that might be used for peer review activities is automatically protected by the peer review confidentiality statutes of the various states.

Congress Repeals Medicare Sustainable Growth Rate (SGR)

MGMA has published the following alert:


Congress repeals SGR!

In a significant victory for physician group practices and MGMA, late this evening the Senate voted (92-8) to approve the Medicare Access and CHIP Reauthorization Act, H.R. 2. This legislation, which passed the House of Representatives on March 26, permanently repeals the Medicare Sustainable Growth Rate (SGR) formula. President Obama publicly stated that he will sign the bill into law.


Permanent repeal of the SGR has been a top priority of MGMA’s advocacy efforts. We thank our members for their critical grassroots support in getting this legislation passed.


MGMA president and chief executive officer Halee Fischer-Wright, MD, MMM, FAAP, released the following statement:

“This is a historic day–the dark cloud over physician group practices has been lifted. The Senate vote to permanently repeal the SGR returns stability to physicians and Medicare patients alike. MGMA congratulates Congress on this momentous, bipartisan achievement.”

No SGR Action by Senate

March 27, 2015 – Special Alert


Senate leaves for recess with no action on SGR repeal 
Despite a successful vote in the House yesterday, the Senate failed to bring to a vote legislation to repeal the flawed Medicare Sustainable Growth Rate (SGR) formula before leaving for April recess early this morning. MGMA is extremely disappointed that the Senate failed to enact permanent SGR repeal legislation before the March 31 deadline and will allow a 21% physician payment cut to take effect April 1. It is imperative that the Senate return from recess ready to pass this legislation. Tune into Wednesday’s Washington Connection for more information on what happens next.


MGMA president and chief executive officer Halee Fischer-Wright, MD, MMM, FAAP, released the following statement:

MGMA: Specter of a 21% decrease in reimbursement is looming over nation’s caregivers

“MGMA is extremely disappointed the Senate failed to act on permanent SGR repeal and will allow a 21% physician payment cut to take effect on April 1. We urge the Senate to vote to repeal the SGR immediately upon return from the April recess and remove its dark cloud over physician group practices.”


MGMA has repeatedly urged Congress to put an end to temporary short-term patches and pass a permanent solution to the SGR. Join the effort! Contact your Senators and urge them to repeal SGR once and for all.

News from MGMA re SGR Repeal

Historic SGR repeal passes in House 
Today, the House of Representatives passed the Medicare Access and CHIP Reauthorization Act, H.R. 2, by a vote of 392–37. This legislation permanently repeals the SGR and returns stability to physicians and Medicare patients.


MGMA President and CEO Halee Fischer-Wright released the following statement:

“The House of Representatives has voted to remove the dark cloud of financial uncertainty over physician group practices. Medicare innovation has been hampered far too long by the SGR. The Senate is one vote away from returning stability to patients and physicians in Medicare. MGMA urges the Senate to immediately vote to repeal the SGR.”


MGMA has worked tirelessly over the years urging Congress to permanently repeal the SGR and put an end to temporary short-term patches. MGMA members have lent their own critical support to the effort, engaging in years of influential grassroots campaigns.


Attention now turns to the Senate, which must also pass the legislation before the current patch expires on March 31 to avoid an automatic 21% cut to physician payments. Make your voice heard! Urge your Senators to repeal the SGR now.

Ohio Proposes New Telehealth Prescribing Regulations

The Ohio State Medical Board has proposed new telehealth prescribing regulations, which are predicated upon whether the drug is a controlled or not a controlled substance.

Non-Controlled Substances

For non-controlled substances, physicians may prescribe or dispense medication to a person on whom the physician has never previously conducted a medical evaluation only if the physician completes and document a medical evaluation and collects a relevant clinical history that “conforms to minimal standards of care consistent with an evaluation that was completed in a face-to-face interaction” using real time telehealth technology.

Controlled Substances

For controlled substances, physicians may dispense or prescribe only in the following situations:

  1. On-call or cross coverage arrangements with another physician.
  2. Consulting with another physician or healthcare provider.
  3. As a medical director or hospice physician to a patient enrolled in hospice program.
  4. Persons for in-patients or residents of institutional facilities.

Pennsylvania Nursing Home That Failed To Sign Arbitration Agreement Cannot Seek to Enforce the Agreement

Danielle Dietrich, an attorney in Tucker Arensberg’s Pittsburgh office, recently prepared the below:

On January 15, 2015, the Pennsylvania Superior Court in Bair v. Manor Care of Elizabethtown, PA, LLC 2015 Pa. Super. 9 (2015) ruled that a nursing home arbitration agreement was not enforceable when the facility did not sign the agreement.

M. Sylvia Bair commenced this action for wrongful death and survival in the Court of Common Pleas of Lancaster County as Executrix of the Estate of Martha A. Edwards against Manor Care, alleging that neglect and abuse of Ms. Edwards by Manor Care lead to her death.

Manor Care filed preliminary objections seeking to have the case referred to arbitration pursuant to an arbitration agreement executed by Ms. Bair on behalf of Ms. Edwards upon her admission to Manor Care. However, no Manor Care representative completed or signed the arbitration agreement on behalf of the entity. The trial court overruled Manor Care’s preliminary objections, permitting the litigation to move forward in the state court. Manor Care appealed to the Pennsylvania Superior Court.

The “Voluntary Arbitration Agreement” at issue contained blanks on the first page for the insertion of the names of the contracting parties and the date. Those blanks were not completed. The agreement also failed to attach a brochure to which it referred and incorporated into the agreement. There were also signature lines for the Patient, the Patient’s legal representative and for the Center Representative. The Center Representative did not sign the agreement.

Manor Care argued that the mere presentation of the form constituted an offer to arbitrate. By signing the agreement, they argued, Ms. Bair accepted the offer.

Ms. Bair argued that the form does not indicate who the parties are and that the form was “facially devoid of essential terms” and was therefore unenforceable.

The Superior Court found that by failing to affix its signature, Manor Care did not consent to arbitrate, as there was no mutual assent. It found that the nursing home could not enforce the arbitration agreement.