KELLY MCEVERS, HOST:
In Pittsburgh, a battle is going on between two big health care companies that could end in a messy divorce. The region's dominant insurance company and the largest hospital system had worked together for decades. But now, they're becoming competitors. With the Affordable Care Act, disputes like this could become more common and patients could get caught in the middle. NPR's Jeff Brady has more.
JEFF BRADY, BYLINE: For most of Gail Jameson's life in Pittsburgh, when she thought about health care, two organizations came to mind.
GAIL JAMESON: My insurer was Highmark, and I went to UMPC doctors.
BRADY: Highmark is the local Blue Cross Blue Shield insurance company and UPMC is University of Pittsburgh Medical Center. For locals, this combination was the gold standard for health care in western Pennsylvania. Jameson says she knew her doctors, and they knew her.
JAMESON: I could go in and just stop in if I needed to 'cause it's close to my work. I go past it every day.
BRADY: Jameson works at a daycare. She's about five years from retirement and good health care is important to her. So she was disappointed to learn her Highmark policy will no longer include UPMC health care providers.
JAMESON: I have to find all new doctors.
BRADY: This dispute began when Highmark got into the hospital business. It bought a struggling health system that was UPMC's main rival. That turned these allies into competitors.
There's a good reason an insurance company would decide to become a health care provider - the Affordable Care Act. It tells insurance companies what basic services to offer, who they must insure and even what percent of premiums can go to administrative expenses and profits. That takes away a lot of what insurance companies used to do. So they're looking for new reasons to exist.
Gail Wilensky is a health care policy expert at the nonprofit group Project Hope.
GAIL WILENSKY: Insurers are trying to demonstrate that they bring value to the table and are doing more than just brokering a benefit and doing more than paying bills.
BRADY: Wilensky says some insurance companies are trying to build more efficient networks of high-quality providers. Highmark went a step beyond that and became a provider itself. UPMC responded by expanding its insurance business and now a competitive market is developing in Pittsburgh.
To address complaints from patients who no longer can see UPMC doctors, politicians encourage the companies to work out their differences. That's when the dispute spilled onto the airwaves with Highmark saying it wanted to renew an agreement with UPMC.
(SOUNDBITE OF ADVERTISEMENT)
UNIDENTIFIED WOMAN #1: That way, where you go for your health care or your health insurance will be totally up to you, like it should be. UPMC, let's talk.
BRADY: But UPMC said it couldn't work with a competitor that would divert patients to its own health system.
(SOUNDBITE OF ADVERTISEMENT)
UNIDENTIFIED MAN #1: Without those patients, UPMC could be forced to close Shadyside and Mercy hospitals. More than 10,000 - that's the number of jobs that would be lost.
BRADY: The divorce is all but final now. The state of Pennsylvania negotiated a transition agreement. It does things like ensure Highmark patients already in treatment at UPMC can continue receiving care. UPMC president and CEO, Jeffrey Romoff, says the Pittsburgh health care landscape has changed for good.
JEFFREY ROMOFF: It went from one of the least competitive environments that you can imagine - a dominant insurer and a dominant health system joined at the hips with a long-term contract...
BRADY: To a region with two competing health systems. On top of that, UPMC invited three large insurance companies to offer policies in Pittsburgh and create more competition on the insurance side of the business too. Despite some complaints, Romoff says eventually patients will benefit.
ROMOFF: Competition is good. It keeps us all on the top of our game. It gives us an incentive to not be fat and sloppy.
BRADY: With competition comes the marketing campaigns. UPMC is banking on its good reputation. Highmark president and CEO, David Holmberg, says his company will appeal to those concerned about price.
DAVID HOLMBERG: For some people, their monthly premium and the cost of their health care - it may be more important than having access to everything.
BRADY: People buying insurance have more decisions to make these days. Health care policy expert Gail Wilensky says that means more homework to decide which plans best fit your needs.
WILENSKY: Many people - particularly people who have not had any choice of insurance, yet alone, a number of choices - are finding that what looks like an attractive plan - when they weren't really looking at who they could go see if they got sick - looks very different once they try to use it.
BRADY: Wilensky says the Pittsburgh experience is more dramatic than other places because the split between the two companies has been so public. But she says what's happening here does represent broader changes in the wake of the Affordable Care Act.
The number of choices customers have is increasing, and the line between health care insurance companies and health care providers is blurring. Back in Pittsburgh, Gail Jameson would like to choose a plan that includes her old doctors. But that costs $500 a month. So she's searching for new health care providers in a different network that costs half that much.
JAMESON: I just don't like change. I shouldn't have to change.
BRADY: The purpose of the Affordable Care Act is to increase the quality and affordability of health care. Whether the changes happening in Pittsburgh and across the country will accomplish that goal is still in open question. Jeff Brady, NPR News.