UPMC reports $339 million operating loss in 2024
UPMC lost $929,000 a day last year amid a spending spree on new and expanded facilities.
In its end-of-year financial report, the hospital and health insurance giant placed its operating losses at $339 million, up 71% from the previous year, when losses hit $198 million in 2023.
UPMC attributed $128 million of the deficit to restructuring, through which it slashed more than 1,000 jobs, among other changes.
Health care services generated $167 million more than they lost thanks to higher patient volumes, lower labor contract obligations and a $270 million FEMA reimbursement for covid-19 related expenses. Insurance services finished the year $506 million in the red. The services make up a slight majority of the business.
Higher use of medical services by UPMC Health Plan members, ballooning pharmacy costs and declining insurance enrollment were blamed for these losses.
UPMC insures about 4.1 million members, down from 4.5 million at the end of 2023. Those members are increasingly accessing GLP-1 drugs to treat Type 2 diabetes and obesity, the organization said in its report, which can retail for more than $1,000 a month.
Several capital investments, primarily in Pennsylvania, also drained finances, even as overall revenues climbed from $27.7 billion to $29.6 billion between 2023 and ’24.
In February, UPMC opened a cancer center in Mechanicsburg as well as a children’s outpatient therapy facility in New Castle.
It completed a new spine care facility in Lewisburg the following month.
Most notably, the organization made major strides in its $1.5 billion UPMC Presbyterian Tower development in Oakland as well as its $84 million UPMC Children’s Heart Institute, an addition to its children’s campus in Lawrenceville. Both are expected to open in 2026.
UPMC is Pennsylvania’s largest non-governmental employer, with about 100,000 employees, including more than 5,000 physicians and more than 21,000 nurses and support staff.
It runs in excess of 40 hospitals and 800 other medical facilities, making it one of the nation’s most expansive nonprofit health systems.
Jack Troy is a TribLive reporter covering the Freeport Area and Kiski Area school districts and their communities. He also reports on Penn Hills municipal affairs. A Pittsburgh native, he joined the Trib in January 2024 after graduating from the University of Pittsburgh. He can be reached at jtroy@triblive.com.
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