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UPMC Shows Positive First-Half 2020 Financial Results in the Face of COVID-19 Crisis

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8/26/2020

UPMC First Six Months Calendar Year 2020 Results:

  • Operating income of $59 million; operating revenues increased 9% to $11 billion.
  • UPMC Insurance Services Division, the largest medical insurer in western Pennsylvania, grew 
    9% to 3.9 million members.
  • UPMC continues to advance patient care with capital expenditures totaling $420 million.
  • UPMC provided $1.4 billion in community benefits during Fiscal Year 2019. 
  • $9.1 billion in cash and investments provide for long-term sustainability.
Pittsburgh, Aug. 26, 2020 – UPMC’s positive first-half 2020 financial results clearly show the benefits of its successful integrated delivery and finance system strategy. Patient volumes rebounded as a result of UPMC’s leadership role in educating the public and policy makers during the COVID-19 pandemic and its accelerated re-opening of routine and specialized care. UPMC continued to reinvest in clinical excellence and needed services for all the communities we serve.  

 
For the first six months of Calendar Year 2020, UPMC had operating income of $59 million. Operating revenues increased 9% to $11 billion. UPMC’s Insurance Services Division — the largest medical insurer in western Pennsylvania — grew another 9% and now totals 3.9 million subscribers. 

Compared to the same period a year ago, UPMC outpatient revenue decreased 4%, while physician revenue was down 14%; admissions and observations decreased by 13%. 

“During this unprecedented period, UPMC clinicians and facilities were prepared to care for the potential surge of COVID-19-positive patients while also safely providing life-saving care to our non-COVID patients. We never stopped providing essential care,” said Edward Karlovich, vice president and interim chief financial officer, UPMC. 

“While government guidelines and patients’ preferences resulted in the postponement of many scheduled surgeries and procedures, our clinical volumes began to return to pre-pandemic levels during the second quarter as our patients continued to seek UPMC care.” 

Meanwhile, the health system spent $420 million on capital expenditures to continue enhancing facilities and technology to extend quality care for patients and communities throughout Pennsylvania and beyond.  Such projects include continuing construction of the UPMC Vision & Rehab Center in Uptown Pittsburgh, expansion of the UPMC East Emergency Department, renovations and additions at  UPMC West Shore hospital in central Pennsylvania, and the expansion of UPMC Children’s Express Care as well as UPMC Magee Women’s Specialty Services in the UPMC Lemieux Sports Complex in Cranberry, Pa. to better serve the communities north of Pittsburgh. 

UPMC also released its 2019-20 Community Benefits Report, detailing how UPMC provided $1.4 billion in IRS-defined community benefits during Fiscal Year 2019, up by $175 million from last year. UPMC’s total economic impact of $42 billion has nearly doubled in the last five years. As the Commonwealth’s largest non-governmental employer, UPMC supports more than one in four hospital jobs in Pennsylvania.

The $1.4 billion in community-focused programs last year equals nearly $4 million per day or more than 15% of net patient revenue. According to the most recent publicly available data, UPMC contributes more than what any other health system in Pennsylvania contributes.  The $1.4 billion total includes: $479 million to make care more accessible for the most vulnerable residents in our communities, including $102 million in free or discounted care to more than 20,000 patients and $377 million in unreimbursed Medical Assistance costs and other subsidized care; $376 million for community health and wellness programs and charitable contributions, including more than 3,000 free and subsidized programs; and $548 million for medical research and education, advancing breakthrough treatments and cures while training the next generation of clinicians. Over the past five years, UPMC’s community benefits have totaled $5.4 billion.

About UPMC

A $21 billion health care provider and insurer, Pittsburgh-based UPMC is inventing new models of patient-centered, cost-effective, accountable care. The largest nongovernmental employer in Pennsylvania, UPMC integrates more than 90,000 employees, 40 hospitals, 700 doctors’ offices and outpatient sites, and a 3.9 million-member Insurance Services Division, the largest medical insurer in western Pennsylvania. In the most recent fiscal year, UPMC contributed $1.4 billion in benefits to its communities, including more care to the region’s most vulnerable citizens than any other health care institution, and paid more than $800 million in federal, state and local taxes. Working in close collaboration with the University of Pittsburgh Schools of the Health Sciences, UPMC shares its clinical, managerial and technological skills worldwide through its innovation and commercialization arm, UPMC Enterprises, and through UPMC International. U.S. News & World Report consistently ranks UPMC Presbyterian Shadyside among the nation’s best hospitals in many specialties and ranks UPMC Children’s Hospital of Pittsburgh on its Honor Roll of America’s Best Children’s Hospitals.  For more information, go to UPMC.com.


Additonal Resources

UPMC Quarterly Disclosure (PDF) for the first six months of 2020.

Second quarter of 2020 financial results support slides (PDF)