"The board has reviewed this situation thoroughly and has taken decisive action to address the matter," said Highmark's board chairman J. Robert Baum, who was named acting CEO when Melani was placed on leave four days after trading punches with Mark Myler.
Melani is "deeply disappointed and upset" by the board's move, according to a statement by his attorney, Robert G. Del Greco, Jr.
"We will be reviewing the legal propriety of Dr. Melani's dismissal and will act accordingly," Del Greco said.
Melani had led Highmark since 2003.
During that time, he "grew to become one of the most respected and successful healthcare organizations in the nation," Del Greco said.
The board, however, is "moving forward to identify a long-term successor to the CEO position," Baum said in the company's statement.
Under the merger proposed in 2007, Melani was to become Independence Blue Cross's new chief executive and Joseph Frick, who headed that company, was to assume the number-two spot.
But in one tense hearing on the merger plan, Melani appeared angered when then-U.S. Sen. Arlen Specter raised questions about his compensation. After stiff resistance, the two insurers withdrew their proposal in 2009.
Melissa Myler, 28, told Oakmont police that Melani had hired her last October. Three weeks later, they started a romantic relationship. The two moved in together after Melani's wife, Tracy, told Mark Tyler about the affair in January, according to a copy of the police report.
Two months later, Melissa Myler said she learned that Melani was having her investigated by a private detective, the report said.
Last Sunday, Melani showed up at the Myler house, the police report said, and accused Melissa Myler of cheating.
"It's all about my money," he said, according to the report. Then, he refused to leave.
Mark Myler took Melani by the arm and got him outside on the front porch. That's where the fight broke out.
Both men "had some swelling about the face and also had some minor bleeding," the police report said.
On Sunday, Liz Williams, a spokeswoman for Independence Blue Cross, cited the company's "strong, productive relationship with Highmark." She added: "We continue to have confidence in the talent and integrity of the associates and senior leadership at Highmark."
Contact staff writer Darran Simon at 856-779-3829 or firstname.lastname@example.org or follow him on Twitter @darransimon.