UPMC Reports Strong Third Quarter Fiscal Year 2012 Financial Results
- UPMC’s operating revenue grew by $746 million to $7.2 billion, with an operating income of $290 million.
- UPMC’s operating EBIDA – or cash flow income – was $584 million.
- UPMC’s $3.7 billion diversified investment reserve portfolio provides for long-term sustainability.
- UPMC continues to increase services and invest in the region, with $416 million in capital expenditures during first nine months of fiscal year 2012.
- UPMC’s financial strength supports more than half-a-billion dollars in community benefits yearly.
PITTSBURGH, May 10 – UPMC’s financial strength through the first nine months of fiscal year 2012 allows the region’s largest health care provider to serve the needs of the community while continuing to re-invest in the region. UPMC today released the details of its financial results for the third quarter of fiscal year 2012, ending March 31, 2012.
UPMC’s operating revenues increased by $746 million to $7.2 billion for the first nine months of the fiscal year. Operating income declined by $23 million to $290 million.
UPMC’s earnings before interest, depreciation and amortization (EBIDA) – a key measure of financial performance and the ability to generate the necessary resources for reinvestment – were $584 million for the period and are on target to exceed $700 million for fiscal year 2012.
During the first nine months of the fiscal year, UPMC spent $416 million in capital expenditures in order to enhance world-class clinical care and provide services for the communities it serves through new technology, hospital and other facility construction and renovations. UPMC’s capital spending alone supports more than 2,000 high-paying construction-related jobs.
“Our strong financial position allows us to advance our mission of developing and providing world-class clinical care and other outstanding service programs to enhance the health of individuals, local communities and the entire region,” said Robert A. DeMichiei, UPMC senior vice president and chief financial officer. “While UPMC’s results are exceptionally strong, we must continue operating efficiently and further improve our margins to meet the increasing challenges of health care reform, global economic pressures and declining reimbursements.”
UPMC’s key operating metrics were up compared to the same period a year ago.
Outpatient revenue was up 21 percent; UPMC Health Plan membership grew 15 percent to more than 1.8 million subscribers; total hospital admissions and observations were up 11 percent; physician revenue was up 8 percent; and the number of employed physicians grew 13 percent to 3,266.
UPMC’s diversified investment reserve portfolio stands at $3.7 billion, with a 1.1 percent return for the first three quarters of the fiscal year. “It is important to note that UPMC maintains a long-term investment perspective. We continue to avoid the need to draw on our long-term reserves to fund day-to-day operations, capital expenditures or employee pension plans,” said C. Talbot Heppenstall, Jr., UPMC senior vice president and treasurer.
UPMC Provides More than a Half-a-Billion Dollars in Community Benefits for Third Consecutive Year
UPMC also released today a summary of its annual Community Benefits Report for fiscal year 2011. In its role as the region’s health care leader, for the third consecutive year, UPMC contributed more than a half-a-billion dollars in community benefits. Fiscal year 2011’s total of $565 million includes: $206 million in uncompensated care for those without a means to pay and shortfalls in Medicaid programs; $93 million in community service programs and support for other nonprofit organizations; and $266 million for investment in research and educating tomorrow’s health professionals.
“UPMC is proud of its unique ability and commitment to reinvest in resources to provide a diverse range of benefits to all of the communities we serve,” said Mr. DeMichiei. “Each of our hospital’s local efforts is strongly supported by the vast resources of the integrated UPMC system, and we remain deeply committed to that reinvestment in both our organization and our region.” In the past five years alone, UPMC has contributed $2.6 billion in community benefits.
UPMC is a $10 billion global health enterprise with more than 55,000 employees headquartered in Pittsburgh, Pa., and is transforming health care by integrating more than 20 hospitals, 400 doctors’ offices and outpatient sites, a health insurance services division, and international and commercial services. Affiliated with the University of Pittsburgh Schools of the Health Sciences, UPMC is redefining health care by using innovative science, technology, and medicine to invent new models of accountable, cost-efficient, and patient-centered care.