UPMC to hire 1,300 over 12 months

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Increasing patient volumes have prompted University of Pittsburgh Medical Center officials to raise their estimate of new jobs that will be created this fiscal year at the region's largest employer.

UPMC chief financial officer Robert A. DeMichiei said on Thursday that the health system added 964 full-time jobs in the last six months of 2010, "primarily in clinical areas," and that the health system expected to hire an additional 339 by July 1, when the next fiscal year begins. Of the 1,300 jobs to be added in the 2010-11 fiscal year, about 300 will be in insurance services, to which UPMC plans to add dental and vision plans.

At the same time, he added, UPMC is "being prudent" about increasing expenses as the economy recovers. "We've got to continue to operate efficiently, and we have to continue to further improve our margins."

In discussing UPMC's quarterly financial report at its U.S. Steel Tower headquarters, Mr. DeMichiei and treasurer C. Talbot Heppenstall Jr. said key financial metrics reflected solid financial results.

For the last six months of 2010, UPMC operating revenue rose $144 million to $4.2 billion, with $206 million in operating income. That figure -- up from $130 million for the same period a year earlier -- includes a one-time $21 million refund from the Internal Revenue Service after the IRS determined that medical residents were exempt from the Federal Insurance Contributions Act taxes.

With cash flow income of $400 million, Mr. DeMichiei said the health system was on target to exceed $700 million by the end of the fiscal year on June 30. Mr. Heppenstall said UPMC's investment portfolio was valued at $3.2 billion, near the record level set in 2007.

UPMC also has seen 6.1 percent growth in UPMC Health Plan membership in the past year, from 1.4 million to 1.5 million for the six-month period ending Dec. 31.

For the July-December period in 2010, UPMC had 110,978 patient admissions and observations, compared with 109,961 in 2009, while outpatient revenue rose from $4.8 million to $5.4 million. The health system added 121 physicians, whose ranks now total 2,849, and physician service revenue grew $239,000 to nearly $2.7 million.

During those six months, UPMC had $192 million in capital expenditures, including $31 million in construction costs for UPMC East hospital it is building in Monroeville and $35 million on enhancing its information technology platform.

On Feb. 1, UPMC formalized its affiliation with Hamot Medical Center in Erie, a partnership Mr. DeMichiei said "is taking a very strong hospital and making it stronger" with plans to invest $300 million in facilities, technology, programs and employees.

He also noted that UPMC Mercy had thrived since UPMC took it over in January 2008, as its operating margin had gone from a negative $21.2 million to a projected $900,000 profit for the current fiscal year.

UPMC McKeesport, meanwhile, has seen its operating margin go from negative $2.9 million in fiscal 2009 to a projected profit of $4.5 million in the current fiscal year, with plans to invest an additional $8 million there this year.

Steve Twedt: stwedt@post-gazette.com or 412-263-1963.


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