Pittsburgh-based health insurer Highmark offered West Penn Allegheny Health System $125 million as an incentive for the health system to enter a structured bankruptcy, according to a Pittsburgh Tribune-Review report.
Highmark President and CEO William Winkenwerder Jr., MD, said the incentive shows how committed Highmark was to acquiring West Penn, despite the health system's financial problems.
In testimony yesterday, Dr. Winkenwerder said Highmark believed the Pennsylvania Insurance Department was unlikely to approve the merger unless there was a deal to reduce West Penn's debt, which is in the ballpark of $740 billion.
Highmark filed suit Oct. 1 after West Penn Allegheny canceled the merger agreement Sept. 29, claiming Highmark breached the affiliation agreement by planning to have the system file for bankruptcy. Highmark's suit seeks to prevent the health system from talking to other buyers. West Penn has since filed a countersuit, claiming Highmark is holding it hostage.
West Penn is calling its witnesses to testimony today.
78 West Penn Physicians Want to Oust Interim Leadership, Resume Highmark Talks
Senator Rallies for West Penn, Highmark to Make Amends
Highmark President and CEO William Winkenwerder Jr., MD, said the incentive shows how committed Highmark was to acquiring West Penn, despite the health system's financial problems.
In testimony yesterday, Dr. Winkenwerder said Highmark believed the Pennsylvania Insurance Department was unlikely to approve the merger unless there was a deal to reduce West Penn's debt, which is in the ballpark of $740 billion.
Highmark filed suit Oct. 1 after West Penn Allegheny canceled the merger agreement Sept. 29, claiming Highmark breached the affiliation agreement by planning to have the system file for bankruptcy. Highmark's suit seeks to prevent the health system from talking to other buyers. West Penn has since filed a countersuit, claiming Highmark is holding it hostage.
West Penn is calling its witnesses to testimony today.
More Articles on West Penn Allegheny and Highmark:
Highmark CEO: West Penn Bankruptcy Was Strategy to Boost Odds of Regulatory Approval78 West Penn Physicians Want to Oust Interim Leadership, Resume Highmark Talks
Senator Rallies for West Penn, Highmark to Make Amends