UPMC's operating income sinks 86% in first half of year

UPMC reported higher revenue in the first half of this year than in the same period of 2021, but the Pittsburgh-based health system's operating income declined year over year, according to financial documents released Aug. 23. 

UPMC reported revenue of $12.5 billion in the first six months of this year, up from $12.2 billion in the same period of 2021. 

Expenses also increased year over year. UPMC reported operating expenses of $12.4 billion in the first half of this year, up from $11.6 billion a year earlier. Expenses increased across all categories, including supplies and salaries and benefits. 

"Throughout 2022, the continued effect of COVID-19, along with conditions in the labor and supply markets have resulted in cost growth in employment, staffing and other operating expenses in excess of revenue growth," UPMC management wrote in the financial filing. 

The health system ended the first half of this year with operating income of $81.9 million, down 86 percent from $604.6 million in the same period last year. UPMC's operating margin was 0.7 percent for the first half of this year, compared with 5 percent in the same period last year. 

UPMC reported a net loss of $844.1 million in the first half of this year, compared to net income of $1.1 billion in the same period of 2021. The system's loss from investing and financing activities totaled $865.9 million in the first two quarters of 2022, compared to a gain of $531.1 million in the same period a year earlier.

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