UPMC’s Financial Results for Fiscal Year 2013 Reflect Evolving Health Care Market
- UPMC’s operating revenues grew by $551 million to $10.2 billion, with operating income of $187 million.
- UPMC’s operating EBIDA – or cash flow income – was $611 million.
- UPMC Health Plan total membership grew 16% and now exceeds 2.1 million.
- UPMC continues to advance patient care with capital expenditures and business investments totaling $503 million in fiscal year 2013, averaging $539 million annually over past six years.
- UPMC’s continued high ranking on the U.S. News & World Report Honor Roll (No.10 in the nation, No.1 in Pennsylvania) show commitment to clinical excellence supported by UPMC’s strong financial results.
PITTSBURGH, Aug. 23, 2013 – UPMC’s financial results for fiscal year 2013 continue to reflect the evolving health care market and UPMC’s continued commitment to meeting the community’s health care needs.
UPMC’s operating revenues increased by $551 million to nearly $10.2 billion for the fiscal year, due primarily to growth in insurance services. Operating income was $187 million, excluding a $55 million non-cash expense related to the Pittsburgh Promise agreement. In the original agreement, UPMC matched $1 of every $1.50 raised up to $100 million annually for 10 years. The amended agreement removes annual fundraising targets, allowing the Pittsburgh Promise unlimited time to earn UPMC matching funds. Including the impact of the amended agreement, UPMC’s operating income for the year was $132 million.
For fiscal year 2013, 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 $611 million. Including the impact of the Pittsburgh Promise amended agreement, EBIDA was $556 million for the year.
"We continue to see the impact of our evolving health care market," said Robert A. DeMichiei, UPMC senior vice president and chief financial officer. "Amidst challenges that all hospitals are facing today, UPMC remains strongly positioned to continue our commitment to the health of our region."
UPMC Health Plan membership grew 16 percent since this time last year and now exceeds more than 2.1 million subscribers. UPMC’s other key operating metrics were up compared to the same period a year ago. In a continuously shrinking market with declining reimbursements, UPMC’s outpatient revenue and inpatient volume both were up 4 percent, and physician revenue increased by 6 percent. UPMC’s reputation for clinical and research advancements and accountable patient care allows it to attract physicians from around the world, nation and region as the number of employed physicians grew 5 percent to 3,360.
During fiscal year 2013, UPMC spent $503 million in capital expenditures and business investments to advance clinical excellence, good science, smart technology and accountable care. "Our top 10 ranking for the second year in a row on U.S. News & World Report’s Honor Roll of America’s Best Hospitals is a result of our unwavering mission to provide and re-invest in world-class patient care for western Pennsylvania. It’s what we do," added DeMichiei. U.S. News & World Report ranked UPMC No. 10 in the nation and No. 1 in Pennsylvania.
UPMC’s diversified investment reserve portfolio stands at $4.0 billion, with a 9.6 percent return for the end of the fiscal year. UPMC maintains a long-term investment perspective. "Our long-term investment strategy continues to help us prepare for factors related to health care reform and other economic pressures," said C. Talbot Heppenstall Jr., UPMC senior vice president and treasurer.
A world-renowned health care provider and insurer, Pittsburgh-based UPMC is inventing new models of accountable, cost-effective, patient-centered care. It provides more than $622 million a year in benefits to its communities, including more care to the region’s most vulnerable citizens than any other health care institution. The largest non-governmental employer in Pennsylvania, UPMC integrates more than 60,000 employees, 20 hospitals, 400 doctors’ offices and outpatient sites, a 2.1-million-member health insurance division, and international and commercial operations. Affiliated with the University of Pittsburgh Schools of the Health Sciences, UPMC ranks No. 10 in the prestigious U.S. News & World Report annual Honor Roll of America’s Best Hospitals — and No. 1 in Pennsylvania. For more information, go to www.UPMC.com.