With plans to forge new hospital affiliations and build another from the ground up, 2017 could be Pittsburgh-based UPMC's biggest year of growth yet, reports the Pittsburgh Post-Gazette.
UPMC built one hospital and affiliated with eight others between 2011 and 2016, the total of which cost the health system $1.5 billion, according to the report. UPMC's latest hospital construction plan is for a $250 million facility in South Fayette, Pa., which is expected to cost $250 million.
Here are four things to know about UPMC's year of unprecedented growth.
1. Although UPMC doesn't favor describing its hospital deals as "sales," the health system does typically make investments in the hospitals it transacts with — sometimes worth hundreds of millions of dollars — with the promise of expanding medical services in the local community, according to the report. Between 2011 and 2016, UPMC's affiliation with Hamot Medical Center in Erie, Pa., included an investment of more than $300 million, including the $111 million patient tower announced in December.
2. Although UPMC doesn't disclose its strategy, it employs a variety of arrangements, such as clinical affiliations that involve staffing the hospital's emergency department to expand the UPMC footprint and gain access to new markets, according to the report. The deals also usually involve the hospital being brought under the UPMC umbrella, adopting its name and signage.
3. UPMC's surge in growth is driven by a strong balance sheet and a 41 percent share of the inpatient medical-surgical market across the 29 counties of Western Pennsylvania, according to the report. The health system has 58 percent of the market share in Allegheny County alone.
4. In March, the health system announced an affiliation with PinnacleHealth, a three-hospital system in Harrisburg, Pa. That deal could offer UPMC access to other hospitals PinnacleHealth has recently announced deals with. PinnacleHealth announced five potential transactions in a two-week stretch in March: including Hanover (Pa.) HealthCare Plus, the parent organization of Hanover (Pa.) Hospital, and four hospitals from Franklin, Tenn.-based Community Health Systems.