HARRISBURG, PA — West Virginia University Health System must keep five Western Pennsylvania hospitals and related facilities operating for at least five years and accept restrictions on insurer contracting under a state settlement governing its acquisition of Independence Health System’s Excela and Butler operations.
The Pennsylvania Attorney General’s Office reached the agreement after its Public Protection Division reviewed WVUHS’s planned acquisition of the two systems, which collectively serve nearly 1 million people across several counties.
The Assurance of Voluntary Compliance, filed Aug. 31 in Commonwealth Court, places conditions on hospital operations, negotiations with health insurers, patient financial assistance and the handling of restricted funds.
WVUHS agreed to maintain services at Independence Health System hospitals and other facilities for at least five years and notify the Attorney General’s Office of significant service changes.
The health system also must negotiate in good faith with health plans, with last-best-offer binding arbitration available as a backstop if negotiations fail.
The agreement prohibits WVUHS from imposing anti-tiering, anti-steering, gag, most-favored-nation, exclusivity and all-or-nothing provisions in contracts with health plans. Those restrictions limit contractual mechanisms that can affect how insurers structure provider networks and direct patients among health care providers.
WVUHS also cannot terminate existing Independence Health System, Excela or Butler contracts except for cause.
Another condition requires WVUHS to establish and maintain a policy preventing competitively sensitive information from being shared between its insurance and health care provider subsidiaries.
Attorney General Dave Sunday framed the conditions as safeguards against potential disruptions in access to care following the change in ownership.
“When hospital systems change ownership, there is always the potential for impacts on patient access to care,” Sunday said. “The Excela and Butler Health Systems served numerous Pennsylvanians and families in several counties, so we wanted to be sure those people were not harmed by this transaction.”
WVUHS must maintain charity care and financial assistance policies consistent with Pennsylvania Department of Human Services guidance and disclose those policies to patients when they register for admission.
The settlement also requires restricted funds associated with Independence Health System, Excela and Butler to continue to be used in accordance with their restrictions or for similar applicable purposes.
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