UPMC operating income increases to $177M

Pittsburgh-based UPMC reported an operating income of $177 million for the six-month period that ended Dec. 31, 2014, compared to $112 million for the same period of 2013.

The system's operating revenues grew 2.5 percent, from $5.7 billion in the six-month period ended Dec. 31, 2013 to $5.8 billion for the same period of 2014. The system's operating margin increased to 3 percent for the six-month period ended Dec. 31, 2014, up from 2 percent the previous year.

UPMC is operating in an increasingly competitive insurance market, which includes national insurers Aetna, Cigna, United Healthcare and HealthAmerica. However, UPMC's revenue related to its insurance services increased to $2.6 billion in the second half of 2014 due to increased membership, up $107 million from the same period of the prior year. 

At a briefing Feb. 4, UPMC CFO Robert DeMichiei commented on the increasing competition in the insurance sector. "We're really in a shrinking market, and we're holding our own," he said, according to a Pittsburgh Post-Gazette report.

Along with UPMC's health and insurance services revenues increasing, the system's physician service revenue per weekday increased 5 percent in the second half of 2014 to $5.3 million compared to $5.1 million in the same period the year prior.

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