A recent four part expose in the Pittsburgh Post-Gazette took a close look at UPMC’s real estate dealings and some of its questionable uses of our health care dollars.
UPMC has spent the last thirty years buying up major area hospitals and used its vast wealth and purchasing power to corner huge swaths of land at exorbitant prices. It is estimated that UPMC holds a staggering $2.5 billion in property with 80 percent tax-exempt.
It’s hard to miss the UPMC logo at the top of the U.S. Steel tower, the dozens of billboards all over the region, and even the product placement in Batman’s Gotham City. These items don’t come cheap and they do nothing to improve the quality of care patients receive or the quality of life in our communities. But even these massive expenditures pale in comparison to those of UPMC East, a hospital that some believe engages in as much advertising as it does caregiving.
Newly-opened UPMC East stands on one of the hottest pieces of commercial property in Pennsylvania. When UPMC paid $18.75 million dollars for the UPMC East site, it paid more than double what the land sold for 18 months before.
In fact, many of UPMC’s property acquisition strategies are unlike those of other nonprofit health care systems. UPMC moves quickly when it identifies a piece of property it wants to purchase, often paying far more than market price. Then, UPMC often sells at a loss, sometimes even at a loss in the millions of dollars – millions that could be used to pay living wages, provide charity care or fund other community needs.
According to the Post-Gazette, “UPMC’s staunchest critics cite its land-buying strategy as typical of the way it conducts much of its business: seven-figure executive salaries; multimillion-dollar advertising budgets; and the lease of some of the most expensive office space in the region in the U.S. Steel Tower for its central administration.”
Building hospitals in communities that need them is one thing. Buying up prime real estate so everyone sees UPMC signs wherever they go is another.
Our health care dollars shouldn’t be used to amass a vast real estate empire at any cost.