Commonwealth of Pennsylvania House of Representatives
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COMMONWEALTH OF PENNSYLVANIA HOUSE OF REPRESENTATIVES HEALTH COMMITTEE HEARING STATE CAPITOL HARRISBURG, PA MAIN CAPITOL ROOM 14 0 WEDNESDAY, DECEMBER 18, 2 013 9:09 A.M. INFORMATIONAL HEARING ON INTEGRATED DELIVERY NETWORKS BEFORE: HONORABLE MATTHEW BAKER, MAJORITY CHAIRMAN HONORABLE KERRY BENNINGHOFF HONORABLE BECKY CORBIN HONORABLE GARY DAY HONORABLE GLEN GRELL HONORABLE JOHN LAWRENCE HONORABLE SCOTT PETRI HONORABLE JERRY STERN HONORABLE FLORINDO FABRIZIO, DEMOCRATIC CHAIRMAN HONORABLE VANESSA BROWN HONORABLE JAMES CLAY HONORABLE MARY JO DALEY HONORABLE PAMELA DELISSIO HONORABLE JOHN SABATINA HONORABLE MIKE SCHLOSSBERG Pennsylvania House of Representatives Commonwealth of Pennsylvania 2 ALSO IN ATTENDANCE: REPRESENTATIVE MIKE TURZAI REPRESENTATIVE JIM CHRISTIANA REPRESENTATIVE TINA PICKETT REPRESENTATIVE MARK GILLEN REPRESENTATIVE TONY DELUCA REPRESENTATIVE DAN FRANKEL REPRESENTATIVE RICK SACCONE REPRESENTATIVE HAL ENGLISH COMMITTEE STAFF PRESENT: WHITNEY KROSSE MAJORITY EXECUTIVE DIRECTOR GINA STRINE MAJORITY ADMINISTRATIVE ASSISTANT NICOLE SIDLE MAJORITY RESEARCH ANALYST VALERIE BAROWSKI MAJORITY RESEARCH ANALYST ABDOUL BARRY DEMOCRATIC EXECUTIVE DIRECTOR APRIL RUCKER DEMOCRATIC ADMINISTRATIVE ASSISTANT REBECCA SAMMON DEMOCRATIC RESEARCH ANALYST ALAN COHN DEMOCRATIC EXECUTIVE DIRECTOR OF THE INSURANCE COMMITTEE 3 I N D E X TESTIFIERS ~k ~k ~k NAME PAGE REPRESENTATIVE JIM CHRISTIANA PRIME SPONSOR OF HB 1621 and 1622 ...................9 REPRESENTATIVE DAN FRANKEL PRIME SPONSOR OF HB 1621 and 1622 .................. 17 CHARLES DAVIDSON MCA ADMINISTRATORS INC............................. 24 FRANK TREMBULAK EXECUTIVE VICE PRESIDENT, CHIEF EXECUTIVE OFFICER GEISINGER HEALTH SYSTEM............................ 39 SAM MARSHALL INSURANCE FEDERATION OF PENNSYLVANIA.............. 57 HENRY MILLER BERKELEY RESEARCH GROUP, LLC....................... 7 5 DR. WILLIAM WINKENWERDER PRESIDENT AND CEO HIGHMARK HEALTH.................................... 92 DEBORAH RICE-JOHNSON PRESIDENT HIGHMARK HEALTH PLAN.............................. 104 PAULA BUSSARD HOSPITAL AND HEALTHSYSTEM ASSOCIATION OF PA...... 113 DR. BRAD KLEIN ABINGTON NEUROLOGICAL ASSOCIATES..................12 6 DIANE HOLDER CEO, UPMC HEALTH PLAN............................. 144 TOM MCGOUGH SENIOR VICE PRESIDENT AND CHIEF LEGAL OFFICER UPMC............................................... 150 4 STARR ROMANO REGISTERED NURSE, UPMC ALTOONA HOSPITAL........... 167 THERESA BROWN REGISTERED NURSE, PITTSBURGH, PENNSYLVANIA........ 169 NEIL BISNO PRESIDENT, SEIU HEALTHCARE PENNSYLVANIA........... 172 CATHY DOERFLER HIGHMARK COMMUNITY BLUE CUSTOMER...................184 BILL KAUFMAN HEALTHAMERICA MEDICARE ADVANTAGE CONSUMER MCVEYTOWN, PENNSYLVANIA............................ 186 PAT HAINES SENIOR VICE PRESIDENT OF BENEFITS BOARD OF PENSIONS OF THE PRESBYTERIAN CHURCH...... 190 SUBMITTED WRITTEN TESTIMONY ~k ~k ~k (See submitted written testimony and handouts online.) 1 5 1 P R O C E E D I N G S 2 ~k k k k 3 MAJORITY CHAIRMAN BAKER: Good morning, everyone. 4 The hour of 9:00 having arrived, the Health Committee will 5 come to order. 6 I just wanted to make a few brief opening 7 remarks, and we'll try to stay on schedule. W e ’re already 8 six or seven minutes late. 9 First of all, I'd like to thank the Members 10 who've remained here in Harrisburg for this important 11 hearing. By the size of the group, it's an extremely 12 important issue in Pennsylvania. I know we're all excited 13 to get home to our families and the festivities, so I 14 appreciate your willingness to stay for this very important 15 informational meeting. 16 I also want to thank all the testifiers, and we 17 have a full day's agenda of testifiers scheduled for today, 18 and I want to thank them for making the trip to Harrisburg 19 to provide insight and their commitments, comments, 20 concerns on integrated delivery networks. 21 Just to set the stage a little bit, I do want to 22 remind everyone here that interruptions to those testifying 23 will not be tolerated. I understand this is a contentious 24 topic and there are individuals who are very passionate on 25 both sides of the equation. The Members of this Committee 6 1 are seeking facts and information and only then can we 2 determine the best way forward, so please allow the 3 testifiers to present their information unimpeded and be 4 treated with dignity and respect. 5 We're going to remain very close to the agenda 6 that's in your packet. As you see, it's very thick. We 7 have additional information here. If we run out, please 8 let my staff know. Gina's standing here at the podium. If 9 you need any additional information, she can send it to you 10 electronically. We do have additional copies here if you 11 need one in the audience, but if we do run out, please let 12 Gina know and she'll provide it for you. 13 I know there will be times when we may not have 14 time for questions. Some of these may go unanswered, given 15 the volume of testifiers we have, but we do need to move 16 forward or we're going to be here quite late. 17 In order to attempt to answer all possible 18 questions, I will invite the Members of the Health 19 Committee and all other Members here to submit any 20 additional questions you have to my Executive Director, 21 Whitney Krosse, as well as to the Democrat Executive 22 Director, Abdoul Barry. Where's Abdoul? He will be here. 23 Okay. They will submit the question to the relevant 24 testifier, and the question and answer will be made part of 25 the record. So we do really need to move along. 7 1 With that said, I thank you again for attending, 2 and I want to turn it over to my good friend, Minority 3 Chairman Flo Fabrizio. 4 MINORITY CHAIRMAN FABRIZIO: Thank you, Mr. 5 Chairman, and I too would like to extend morning greetings 6 and welcome you and thank you for attending this hearing. 7 With the two bills before us today, House Bill 8 1621 and 1622, we venture into uncharted and unregulated 9 territory of integrated delivery networks where medical 10 treatment and health insurance are offered jointly. It’s a 11 challenging new world with insurers providing health care 12 and health care providers offering insurance. No matter 13 the eventual fates of these two bills, this is a 14 conversation that we must have and we must deal with 15 because integrated delivery networks are here and the 16 future is now. 17 Obviously, there’s been some friction, and it was 18 to be expected when competition and consolidation collide. 19 It’s no secret these bills were prompted by the friction 20 between two big players, UPMC and Highmark. While I regret 21 the timbre and the tenor of the early debate, it does focus 22 attention on the need for Pennsylvania to work crafting 23 viable regulations for all integrated delivery networks. 24 The conversation and deliberations that we have here today 25 will help determine the future health care of Pennsylvania, 8 1 and the impact of the decisions confronting us will not end 2 in this room nor just in western Pennsylvania. 3 I don't think it will be easy sorting this out, 4 particularly for a rookie like me, and I'm still on the 5 learning curve, but w e ’re trying to grasp it. But all 6 sides we know will have some valid points and some 7 compelling arguments, and I would venture to say, speaking 8 on behalf of all Committee Members, we are here to listen. 9 We ’re going to keep an open mind and w e ’re going to listen 10 to it all. 11 But when we work through all the jargon, when we 12 work through all the deliberations, when we work through 13 all the compelling arguments, the crux of the matter comes 14 down to ensuring that Pennsylvanians have fair access to 15 affordable, quality health care without impeding 16 competition, and I think we can all agree on that. 17 Pennsylvania is blessed with some of the best 18 health care networks in this country but they do little 19 good if they’re inaccessible, unaffordable and unfair. I 20 hope we don’t lose sight during the deliberations of the 21 consumer because the consumers are our neighbors and our 22 friends that deserve the best health care available, and 23 they don’t deserve the threat of being denied services or 24 being abandoned while undergoing treatment. It’s a concern 25 of all of ours, and it’s a mutual concern of everyone in 9 1 this room. 2 I look forward to the testimony and the rigorous 3 debate, and as I said before, I along with all the Members 4 of this Committee will keep an open mind. 5 As I said, we're venturing into uncharted waters 6 but the policies that must and will be launched from 7 conversations like this one that we'll have today, these 8 that we'll have today, are vital to Pennsylvania's future, 9 and I intend to look at the big picture. 10 Thank you, Mr. Chairman. 11 MAJORITY CHAIRMAN BAKER: Thank you, Mr. 12 Chairman. 13 I do want to acknowledge the presence in the room 14 of the Majority Chairman of the Insurance Committee, 15 Representative Tina Picket, Minority Chairman 16 Representative DeLuca, Speaker Sam Smith and others that 17 are here observing as well. 18 Without further ado, we will start the agenda, 19 the very long agenda that we have today, the prime sponsors 20 in chief. Representative Jim Christiana and Representative 21 Dan Frankel, who have introduced the two pieces of 22 legislation, will begin as testifiers. You may proceed 23 when you’re ready. 24 REPRESENTATIVE CHRISTIANA: Good morning, Mr. 25 Chairman. Thank you for hosting this hearing, and I also 10 1 would like to thank the Members of the Committee and other 2 Members that are here today that have delayed their 3 Christmas recess by a day.