Top 50: Health care firms continuing to grow

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With revenues of $1.4 billion, West Penn Allegheny Health System, the combination of the Western Pennsylvania Hospitals, Forbes Health System, Allegheny General Hospital and its affiliates, should be considered a significant health system.

But in Pittsburgh, where Highmark Inc. brought in $11.9 billion and the University of Pittsburgh Medical Center, with all of its affiliated hospitals, brought in $6.8 billion, West Penn Allegheny is a much smaller player.

UPMC's revenues are only going to grow this year because of the acquisition of Mercy Hospital. The rest of the Pittsburgh Mercy Health System remains intact.

The combined revenues of the two for 2007 was more than $7 billion.

UPMC is in the midst of rearranging its furniture. The executive and administrative offices are moving Downtown to the U.S. Steel Tower, which will soon have huge UPMC letters up top. Children's Hospital of Pittsburgh will be moving next year to a new building in Bloomfield on Penn Avenue, where St. Francis Hospital used to be.

That will open up a lot of space for Presbyterian University Hospital, Falk Clinic and Montefiore Hospital in Oakland, which are all part of UPMC.

UPMC recently signed a contract to manage a hospital in Ireland, where it already oversees two cancer centers. The center runs a transplant center in Italy and provides expertise to a hospital in Qatar. Other deals are under consideration in the United Kingdom, the Mediterranean and the Middle East.

As big as UPMC is, it may be completely dwarfed if Highmark is allowed to merge with Independence Blue Cross of Philadelphia. The combination of the two would give the new insurance company somewhere in the neighborhood of $23 billion to $25 billion in annual revenues, making it the third largest health insurer in the country.

That merger has been opposed by Capital Blue Cross of Harrisburg, which would be surrounded by the newly combined insurance company.

At West Penn, the administration is working on eliminating redundancies in its system by combining departments under a new chief executive officer. West Penn's revenues for 2007 were flat for the third straight year at $1.4 billion.

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Correction/Clarification: (Published Mar. 19, 2008) This article on health care firms as originally published Mar. 18, 2007 gave the wrong total for revenues if Highmark and Independence Blue Cross of Philadelphia are allowed to merge. The figure is $23 billion to $25 billion.

Ann Belser can be reached at or 412-263-1699.


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