Pitt Medical Center income drops 70 percent

Despite generating higher revenue on increased patient volume, net income dropped sharply at the University of Pittsburgh Medical Center (UPMC) during the second half of 2007. The hospital's net income plunged 70 percent to $103 million, as compared with $344 million for the second half of 2006. How did this happen? The hospital took a body blow from a dramatic fall in its investment income, which dropped 99 percent during the six months ending December 31.

UPMC is otherwise a very successful operation which books almost $7 billion annually from its 19 hospitals, insurance division and overseas ventures. Its revenue has been climbing 12 percent annually since 2003. Its investments have also been successful, generating almost $500 million over the last 66 months, the school noted. Given its otherwise consistent success, averaging 11.9 percent returns over the last five years, UPMC plans to stick with its long-term investment strategy. In any event, UPMC continues to do well overall. For its fiscal year ending June 30, 2007, its net income was $618 million on revenue of $6.8 billion. That's a jump up its fiscal 2006 net income of $525 million on revenue of $6 billion.

To get more detail on UPMC's financial situation:
- read this Pittsburgh Tribune-Review article

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