Skip to Navigation
University of Pittsburgh
Print This Page Print this pages

October 10, 2002

Pitt seeks health insurance bids

Pitt is asking vendors to get creative with their bids for the University’s health insurance business.

Pitt’s exclusive contract with UPMC Health Plan expires June 30, 2003. The University recently sent RFPs (requests for proposals) to the major players in western Pennsylvania’s health insurance market: UPMC Health Plan, Aetna, Health America and Highmark. Proposals are due back to Pitt later this month.

Besides inviting insurers to submit bids based on Pitt’s current health insurance options, the University has asked for alternative proposals.

Ronald W. Frisch, Pitt associate vice chancellor for Human Resources, said, “What we’ve said to vendors is: Come back to us with a creative set of options. We know the range of health insurance coverage that we have today, and we know that you’re going to tell us that our rates are going to go up under that current arrangement. So, give us your best rates for the current options — but also, tell us about other options that we might want to look at.

“The health insurance industry is in a state of flux right now,” Frisch said. “We don’t know what the vendors are going to come up with. We’ve intentionally left it vague to encourage them to be creative.”

One stipulation is that Pitt will sign a health insurance contract only with a vendor or vendors that use UPMC Health System hospitals and physicians. But that doesn’t make UPMC Health Plan Pitt’s only option; other insurers can, or could arrange to, be “fully participatory” with UPMC facilities and doctors, Frisch said.

Human Resources would prefer that its next health insurance contract be another three-year deal similar to Pitt’s current contract with UPMC Health Plan, but Frisch acknowledged that the trend in western Pennsylvania is toward one- or two-year deals.

Employers that recently negotiated new health insurance contracts saw double-digit hikes in their premiums, said Frisch, who declined to estimate how high Pitt’s rates could jump next July.

“If I’m quoted as saying, ‘We expect that our premiums are going to go up by 25 percent,’ then the vendors are all going to come back to us with proposals calling for 25 percent increases at least,” he said.

Herbert Chesler, co-chairperson of the University Senate’s benefits and welfare committee, told Faculty Assembly last week that Health America offers Penn State employees discounts on their health insurance premiums in exchange for participating in PSU fitness programs.

Chesler said he will pursue the possibility of offering similar discounts at Pitt, both through his Senate committee and another group of which he is a member: the committee of faculty, staff and Human Resources administrators that advises Pitt’s senior administration on health insurance issues.

Offering premium discounts to Pitt employees in exchange for participating in University exercise and wellness programs “is not something that we’re pushing for, nor is it something that we’re not pushing for,” Frisch said. “It’s not included in the RFPs at this point. Is it something that we could negotiate later? Possibly.”

— Bruce Steele

Filed under: Feature,Volume 35 Issue 4

Leave a Reply