UPMC Continues Strong Financial Performance Through Fiscal Year 2014 and Rapidly Changing Market
- UPMC’s operating revenues grew by $1.2 billion to $11.4 billion, with operating income of $190 million and a net income of $567 million.
- UPMC’s operating EBIDA – or cash flow income – was $644 million.
- UPMC Health Plan total membership now more than 2.3 million.
- UPMC continues to advance patient care with capital expenditures and business investments totaling $458 million in fiscal year 2014, averaging $506 annually over past six years.
- UPMC’s $177 million pension contribution maintains its funded status and protects employees’ retirement plans.
PITTSBURGH, Aug. 21, 2014 – UPMC’s financial results for fiscal year 2014 show the region’s premier health care provider is maintaining its strong position of providing world-class clinical care in a rapidly changing market.
UPMC’s operating revenues increased by $1.2 billion to $11.4 billion for the fiscal year, due primarily to growth in insurance services, the affiliation with UPMC Altoona and increased patient volumes. Operating income, which is reinvested in programs that support UPMC’s mission, was $190 million for the fiscal year ending June 30, 2014. UPMC’s excess of revenues over expenses (net income) was $567 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 $644 million.
“UPMC continues to be financially and operationally strong in the still-evolving and challenging environment,” said Robert A. DeMichiei, UPMC executive vice president and chief financial officer. “Our competitive market is proving to be beneficial to employers and the community.”
UPMC Health Plan currently has more than 2.3 million subscribers, growing 9 percent since this time last year. 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 was up 17 percent while inpatient volume grew 9 percent. Physician revenue increased by 11 percent, and the number of employed physicians grew 4 percent to 3,506.
During the fiscal year, UPMC spent $458 million in capital expenditures and business investments to advance its unwavering commitment to provide clinical excellence, good science, smart technology and accountable care to all the communities it serves.
As evidence of this commitment, for the 15th year, UPMC was named to the U.S. News & World Report Honor Roll of “America’s Best Hospitals” while Children’s Hospital of Pittsburgh of UPMC was named to the U.S. News & World Report Honor Roll of America’s Best Children’s Hospitals for the fifth consecutive year. The highest-ranked medical center in Pennsylvania, UPMC earned 12th position on the best hospitals Honor Roll, and Children’s earned ninth place on the best children’s hospitals Honor Roll.
As Pennsylvania’s largest non-governmental employer, UPMC maintains its commitment to ensuring that the retirement plans of its 62,000 employees system-wide are fully funded and contributed $177 million to its pension plans.
UPMC’s diversified investment reserve portfolio stands at $4.3 billion, with a 14.8 percent return for the fiscal year. UPMC maintains a long-term investment perspective. “Our long-term investment strategy has kept us prepared for the challenging and evolving marketplace,” said C. Talbot Heppenstall Jr., UPMC executive vice president, treasurer and chief investment officer.
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 $887 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 nongovernmental employer in Pennsylvania, UPMC integrates 62,000 employees, 21 hospitals, 400 doctors’ offices and outpatient sites, a more than 2.3-million-member health insurance division, and international and commercial operations. Affiliated with the University of Pittsburgh Schools of the Health Sciences, UPMC ranks No. 12 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 UPMC.com.