CBS This Morning aired a segment—which puts Pittsburgh’s recent challenge to UPMC’s charitable status at the center of the growing movement to hold major nonprofits accountable. The piece points out that though UPMC, an international healthcare conglomerate with nearly $1 billion in profits, devotes only 2% of its budget to charity care, it receives millions in tax breaks each year as a result of its charity status.
CBS This Morning Investigates High Earnings At UPMC.
VIEW THE SEGMENT HERE: http://www.cbsnews.com/video/watch/?id=50147906n
The segment notes that UPMC ‘s CEO makes $6 Million a year, more than any other not-for-profit hospital that CBS found in its public records search CBS reporter Terrell Brown also describes how non-profit hospitals are acting like Fortune 500 companies and driving up health care costs in our country.
Join us in holding UPMC accountable to our city.
Sign And Share The Code Of Conduct And Demand UPMC Act Like A Real Charity
Together We Can Make It Our UPMC
Pittsburgh Post-Gazette Endorses Mayor’s Challenge of UPMC’s Tax Exempt Status
In an editorial on March 27th
, the Post-Gazette officially endorsed our city’s decision to challenge the tax exempt status of UPMC, calling it “a fight worth having.”
Pennsylvania’s “HUP test” which sets the standard for charitable organizations has five distinct prongs, and organizations must pass all of them to be deemed a charity worthy of tax-exemptions. The Post-Gazette‘s argument for supporting the challenge to UPMC focuses in on the 5th
of these prongs, which states that an “institution of purely public charity” must “operate entirely free of private profit motive.”
“UPMC closed Braddock hospital in a poverty-stricken area, saying it could not afford the red ink, at the same time it was building one in Monroeville, a prosperous community where another modern hospital already existed.
UPMC, which vigorously promotes its own health insurance plan, does not want to provide affordable access to Highmark insurance customers, who represent the majority of the Western Pennsylvania market.”
These examples raise serious questions about UPMC’s business practices, and whether or not UPMC is in fact an organization that operates free of private profit motive.
Read the rest of the Post-Gazette article here.
Seems like everyone’s talking about the city’s decision to stand up to UPMC. It’s great to see so many people agreeing that if UPMC wants the benefits of being a charity, it needs to start acting like one.
Here‘s some of the best coverage:.
Mayor v. Moneybags: UPMC could be beloved if it put patients over profits and perks – Sally Kalson
“It’s based on the correct impression that a nonprofit hospital’s top priority should be the patients, not building a monopoly. And that a $10 billion system with a billion-dollar surplus and $2 billion to $3 billion in reserves should be taking care of many more indigent sick people than UPMC has been treating — especially when it owns land that a Post-Gazette investigation valued at $1.6 billion, even as it enjoys a $20-million tax break every year, underwritten by the good citizens of Pittsburgh and Allegheny County. “
Profit motive: The city’s UPMC suit will turn on one key factor – Post-Gazette
It is also known for its bitter public dispute with another health-care giant, Highmark, which wants to partner with the West Penn Allegheny Health System, a rival hospital network. UPMC does not want to renew its contract after 2014 with the region’s dominant insurance provider, meaning Highmark customers will lose in-network access to most UPMC services.
UPMC considers all that merely a consequence of competition. The community, by and large, sees it as a double-cross to the people and region whose donations, health premiums and tax dollars built UPMC.
Ravenstahl pledges challenge to UPMC’s tax-exempt status – Moriah Balingit
The mayor cited UPMC’s closure of hospitals in low-income communities, like Braddock, in favor of building hospitals in more affluent communities and facilities abroad. He also talked about the company’s hard stand with rival Highmark insurance, some of whose customers have been denied care in UPMC’s facilities.
Ravenstahl: Pittsburgh sues to remove UPMC’s tax-exempt status – Jeremy Boren and Bobby Kerlik
Pittsburgh Mayor Luke Ravenstahl said city taxpayers should not subsidize the $10 billion hospital system that has fueled UPMC’s rise as Pennsylvania’s largest employer and the region’s richest nonprofit organization.
Ravenstahl referred to the self-described $10 billion global health enterprise’s funhouse mirror insistence that it is a public charity, a legitimate nonprofit entity. The mayor tossed a large rock toward that mirror by announcing the city is legally challenging UPMC’s tax-exempt status; shattering it could net the city $20 million annually.
UPMC was quick to spin the City of Pittsburgh’s legal challenge of its tax-exempt status as a vendetta fueled by politicians doing the bidding of organized labor and business interests. It’s a smokescreen, of course. And rationalizations of such grand conspiracies can’t hide the fact the “nonprofit” claims of this $10 billion worldwide hospital behemoth are ripe for vetting in a court of law.
Mr. Strassburger cites UPMC’s own documents and officials’ statements that show that UPMC may be providing charity care of anywhere from $204 million, or 3.6 percent of net patient revenues, to $87.2 million, or under 1 percent.
Community Blues – UPMC finally feels our pain – Chris Potter
But Ravenstahl’s press conference wasn’t a complete disaster. The media completely ignored UPMC’s most damning critic: Brookline resident Kendra Bowser.
While the politicians talked about CEO pay and the cost of UPMC’s tax exemptions, Bowser was more succinct: “I’m no longer permitted to see the doctors who have been able to give me the ability to live my life,” she told reporters.
It’s great to see so many of our elected leaders standing in support of our City’s challenge to UPMC’s status as purely public charity. They know that we need our largest landowner to contribute to city services, that we need our largest healthcare provider to give more care, and to care for everyone regardless of insurance, and that we need our largest employer to respect workers’ rights on the job.
Here’s a round-up of other elected leaders who are standing up to UPMC on behalf of the hardworking tax-payers, homeowners, small businesses and working people of Pittsburgh.
“The City of Pittsburgh is now taking an appropriate and long-awaited step forward in demonstrating that there will be consequences for mega-charities whose leaders do not meet the standards of a purely public charity.” – City Councilwoman Natalia Rudiak
“As Controller, I see the impact on all of our City residents when Pittsburgh’s largest landowner, largest employer, and dominant health system doesn’t pay its fair share. We all pay the price in reduced City services and higher taxes on working families.” – City Controller Michael Lamb
“UPMC has been aggressive in buying hospitals and taking property off the tax rolls, paying its executives exorbitant salaries, and investing in overseas operations while taking advantage of lucrative tax exemptions that are supposed to be reserved for true charities. When UPMC doesn’t pay its fair share to support public services, every taxpayer ends up picking up the tab.” – PA. Democratic Party Chair Jim Burn
“A good first step” and “As mayor, I will continue challenging UPMC in court.” – City Councilman Bill Peduto
“The law requires that for entitlement to the tax exemptions that go along with being classified as a charity an organization must operate ‘entirely free of private profit motive.’ Its large size is not a reason to hold UPMC to a higher standard than other any other charity, but it is a reason to insist that UPMC live up to the same standards that the rest of charitable, non-profit organizations live by.” – State Rep. Erin Molchany
“Shutting out the competitor’s cardholders is an example of a business practice that is both unethical and inhumane. It is one of the most alarming things I have seen in all my years as a legislator. UPMC’s business practices are interfering with the health and safety of real people, people who we represent as elected officials. UPMC’s board and executive team have a mission, and a large part that mission is to provide care to those in need.” – State Rep. Anthony M. DeLuca
“Our state Supreme Court justices have been explicit that any organization seeking to make its property tax-exempt must put the interests of the community before its own bottom line. Many of my constituents have asked me the same question that Pittsburgh is asking today – is UPMC a somewhat public charity, a mostly public charity, or is it truly a purely public charity as our state constitution requires?” – State Rep. Dan B. Frankel
“Today we are taking on this issue directly. UPMC’s income is largely exempt from taxes. Yet, it is increasingly run like a for-profit company, paying its executives multi-million dollar salaries with perks, renting fancy offices and leasing corporate jets and helicopters, while jumping into new business activities, for-profit ventures, and overseas expansion.” – State Sen. Jim Ferlo
“Despite nearly one billion in profits over two years, UPMC pays many of its employees so little that they are forced to depend on public assistance to pay for basics like food and rent. And when UPMC workers speak out about improving their jobs, UPMC management tries to silence them. That’s not good for UPMC workers, and it’s not good for Pittsburgh’s middle class.” Pittsburgh City Councilman Daniel Lavelle
“Genuinely charitable nonprofit entities should enjoy the benefits of tax exemptions that are conferred under Pennsylvania law. But entities that comport themselves like for-profit businesses at virtually every turn in order to amass gigantic profits should not be able to shift their tax burdens to the hardworking residents of this County simply by calling themselves ‘charities’ and referring to their profits as ‘surpluses.’” – County Councilman John DeFazio
“I commend Mayor Ravenstahl and the city of Pittsburgh for challenging UPMC’s non-profit status and for bringing this issue before the Court to determine whether UPMC truly deserves its current non-profit status. UPMC should welcome the opportunity to provide transparency and prove to the public that they are truly non-profit, once and for all.” – State Sen. Wayne D. Fontana
“This is about fairness for the average Pittsburgh citizen and small business owner, who shoulder a greater burden of taxation for those organizations who receive the privilege of a property tax exemption. They deserve to know that all organizations are paying their fair share and truly deserve their tax exemptions.” – County Controller Chelsa Wagner
Mayor Luke Ravenstahl Asks, “Is UPMC Really a Charity?”
Yesterday was a day for the history books. After months of educating our neighbors, two hearings, three canvasses and thousands of signatures on our Code of Conduct, we were thrilled and proud when our City announced its challenge to UPMC’s tax exempt status
on the basis that they are not living up to their obligations as a charity and the tax exemptions that flow from that status. Congratulations to our City and to our movement!
“They’re not a charity,” Mr. Ravenstahl said. “They haven’t been operating as a charity, and it’s time that this community step up in that regard.” – Post Gazette
Over the last decade we have watched while UPMC executives built a corporate empire. They have closed down hospitals in underserved communities and opened them in affluent suburbs. They’ve turned away patients that carry their competitors’ insurance, they’ve paid top executives millions while service workers need food banks, and they’ve failed to pay their fair share to support vital public services like schools and public transportation. All while harassing employees who are exercising their right to form a union to advocate for quality, middle class jobs.
UPMC Needs To Start Putting The Strength And Health Of Our Community First. Sign Onto The Code of Conduct
You have been going door to door, talking to your neighbors, co-workers, friends and family about our movement for a stronger, healthier Pittsburgh. Because of your hard work, we have over 1000 members of our community that have signed on to our Code of Conduct. Today those voices were heard, and elected officials at every level of government have added theirs to demand that UPMC start acting like a real charity.
But we know we have to keep building this movement. Sign the Code Of Conduct And Hold UPMC Accountable
Yesterday was a great first step by the City toward finally holding UPMC accountable. This historic step would not have been possible without your help. But as the Mayor said, this fight will be a long one. Let’s keep standing up to UPMC for a stronger, healthier Pittsburgh.
Together we can Make It Our UPMC.
Volunteers Canvasing In East Liberty
It’s the question we’ve all been asking. Does UPMC meet the standard for institutions of purely public charity? The City of Pittsburgh thinks not.
Pittsburgh – Today, Mayor Luke Ravenstahl, flanked by elected representatives from the City of Pittsburgh, Allegheny County and the Pennsylvania General Assembly, faith leaders and UPMC patients, announced the City of Pittsburgh is filing legal challenges to UPMC’s tax exemptions. UPMC is the largest beneficiary of charitable tax exemptions in both the City of Pittsburgh and Allegheny County. All told, UPMC’s tax-breaks cost tax payers an estimated $204 million dollars in federal, state and local taxes in 2011.
UPMC, the region’s largest private landowner, employer, healthcare provider and recipient of charitable tax exemptions, has attracted increasing scrutiny into the validity of its status as a charitable organization.
Stakeholders from all over the region have questioned UPMC’s aggressive and predatory business practices, its vast tax-exempt property empire, and the closing of hospitals in underserved areas. In January, UPMC settled over 80 charges of violations of Federal labor law with the National Labor Relations Board (NLRB) after a seven-month long investigation into allegations of a hostile anti-union campaign. And just last week, UPMC told subscribers of a rival insurance company they could no longer see their UPMC doctors – even if they wanted to pay for care out of pocket.
“It has become clear to me that UPMC is not acting like a real charity. We can all see that. To say otherwise really strains credulity. Does a charity turn away patients because they have the “wrong” insurance card? Does a real charity make multi-millionaires of its executives? Does a real charity keep many of its employees living in poverty? Does a real charity put its mission to serve the community aside in the interest of making billions of dollars?” said Reverend David Thornton. “Our common sense tells us no. Our laws tell us no. Our city is taking a principled stand against its Goliath by filing this challenge and we must all make sure we sound our support loud and clear so the City continues to keep this issue is at the top of our community’s agenda.”
“I’m really proud of the City of Pittsburgh today. As a worker at UPMC, I know first hand how hard it can be to stand up to UPMC – inside the hospital and out. But we’ve seen what we can do when we stand together at work,” said Jamie Hopson, a patient care tech at UPMC Montefiore and nursing student. “Now we’re going to stand together with our patients, neighbors, friends and families to win a victory for our whole community.”