Changes in the medical world have forced UPMC and other non-profit hospitals to become larger and more complex organizations. As a tax-exempt nonprofit, UPMC is required to provide community services such as a full-time emergency room plus uncompensated care. It provided $200 million in such free care in 2004.

Few small, nonprofit hospitals exist today because they have no leverage to prevent insurers from dictating unfavorable reimbursement rates. And they can't generate profits and amass the money needed for new medical technology or to attract doctors and staff.

At UPMC, that is not an issue. During the most recent fiscal year, it invested $313 million to improve its facilities and clinical programs, and provided $175 million to support academic programs at the University of Pittsburgh.

The health system has garnered its share of kudos. For six years running it has been named one of the country's top overall hospitals. Its researchers rank among the best at securing federal funds.

"When I'm at meetings, [UPMC] is seen as dynamic and progressive," said Robert M. Dickler, senior vice president for health affairs with the Association of American Medical Colleges. "When the discussion is about successful institutions in the country, you'll often hear UPMC and the medical school listed."

A boost for UPMC, Mr. Dickler said, has been the lack of competing medical schools and health centers in the region, affording the academic medical center a virtual monopoly. Health-care systems in New York, Chicago, Philadelphia and Boston all have multiple institutions competing for patients, funding and influence.

Pittsburgh also is unique in that there is a dominant insurance provider -- Highmark -- across the table from the dominant health system. Having more competition in both areas, said Lawton R. Burns, director of the Wharton Center for Health Management and Economics, ideally would benefit consumers through lower prices. The West Penn Allegheny Health System serves as a counterbalance for UPMC, but it has only one-quarter of the revenue.

"You can't avoid UPMC," Dr. Burns said.

Even a smaller rival benefits the public because it provides a choice, said Cliff Shannon, executive director of SMC Business Councils, which helps its 5,000 member companies in the Pittsburgh region purchase group health plans.

But rivalries don't always lead to decreased costs for consumers.

"Health insurers will tell you uniformly that UPMC -- the largest and most broadly consolidated system in the state -- is the most expensive provider system in its market and by far the most profitable system in the state," Mr. Shannon said.

"At a time when most hospitals in Pennsylvania have lost money on operations for each of the past three years, UPMC's financial success literally stands head and shoulders above all other Pennsylvania hospitals/systems, and compares favorably with the financial performance of any large system in the country."