UPMC First Six Months Fiscal Year 2017 Results:
- Operating revenues grew to $6.8 billion, with net income of $616 million.
- UPMC Insurance Services Division, now the largest medical insurer in western Pennsylvania, grew 7 percent to more than 3 million members.
- UPMC continues to advance patient care with capital expenditures and business investments totaling $256 million.
- UPMC’s $252 million pension contribution maintains its funded status and protects employees’ retirement plans.
- $5.8 billion cash and investments provides for long-term sustainability.
PITTSBURGH, February 28, 2017 – UPMC maintained strong financial performance for the first half of fiscal year 2017, enabling the region’s most preferred provider to continue serving the needs of patients, meeting increasing demand for top-ranked clinical care, and providing affordable insurance choice and competition for the region.
For the first six months of the fiscal year, UPMC’s operating revenues increased to $6.8 billion and net income totaled $616 million. UPMC’s Insurance Services Division, the largest medical insurer in western Pennsylvania, grew 7 percent to more than 3 million subscribers.
“Thriving as one of the nation’s largest and most successful integrated health systems, UPMC has driven the transformation of western Pennsylvania from one of the most highly concentrated and least competitive insurance markets to one of the most competitive, pro-consumer markets with some of the lowest costs,” said Diane P. Holder, UPMC executive vice president and president, UPMC Insurance Services Division.
“More and more businesses are offering alternative, affordable plans that allow their employees unfettered access to UPMC hospitals and physicians,” said Robert A. DeMichiei, UPMC executive vice president and chief financial officer.
For the first half of the fiscal year, UPMC’s admissions and observations increased 8 percent from the period a year ago. UPMC spent $256 million on capital expenditures and business investments as it continues to make significant advancements in facilities, equipment, technology, education and operational strategies to enhance patient care.
Operating income, which is reinvested in programs that support UPMC’s mission of advancing patient care, was $106 million, down $95 million from the period a year ago. Prior year operating income benefitted from $46 million of interest and favorable adjustment of reserves related to the Highmark Oncology arbitration ruling. The remaining decrease versus prior year was driven by expense inflation, payer mix and physician and other investments.
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 $345 million.
In addition, as Pennsylvania’s largest non-governmental employer, UPMC maintains its commitment to making sure that the retirement plans of its 65,000 employees system-wide are fully funded and contributed $252 million to its pension plans.
A $14 billion world-renowned health care provider and insurer, Pittsburgh-based UPMC is inventing new models of patient-centered, cost-effective, accountable care. UPMC provides nearly $900 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 65,000 employees, more than 25 hospitals, 600 doctors’ offices and outpatient sites, and a more than 3 million-member Insurance Services Division, the largest medical and behavioral health insurer in western Pennsylvania. 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. UPMC Enterprises functions as the innovation and commercialization arm of UPMC while UPMC International provides hands-on health care and management services with partners in 12 countries on four continents. For more information, go to UPMC.com.
UPMC Quarterly Disclosure
For the period ended December 31, 2016 (PDF)
FY2017 Q2 Financial Results
Support slides (PDF)