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City’s Fight Over UPMC’s Tax-Exempt Status Goes National

(Photo Credit: KDKA)

(Photo Credit: KDKA)

John Shumway John Shumway
John Shumway joined NewsRadio 1020 KDKA in 2004 as co-host of The KDKA...
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PITTSBURGH (KDKA) — The City of Pittsburgh’s fight with UPMC over its tax-exempt status has jumped into the national spotlight.

A CBS News investigation on Thursday’s CBS This Morning drew a connection between large hospital operations and the rising cost of your health care.

At the center of the report: Pittsburgh’s own UPMC.

The CBS story gave a nod to UPMC’s status as a leading health care institution, but focused questions on its non-profit status fueled by an interview with Pittsburgh Mayor Luke Ravenstahl.

What had been a backyard squabble went national this morning when Mayor Ravenstahl told CBS this about UPMC’s tax-exempt status: “I think they are going to be hard pressed to be able to prove how they are operating the same way as the Little Sisters of the Poor or the local church – true, genuine nonprofits. UPMC, I’m afraid not,” said Mayor Ravenstahl.

Of course, that’s the point of a suit the city filed to get UPMC to pay more in taxes.

CBS’s Terrell Brown: “This political?”

Ravenstahl: “Not at all. In fact, I’m not running for re-election. I’m done in the mayor’s office in nine months.”

“I think the mayor is trying to deflect any attention away from his legal and ethical troubles and the grand jury investigations and the coming indictments and things like that,” Paul Wood, a UPMC spokesman, said.

Wood acknowledged portions of the CBS report like CEO Jeffery Romoff’s salary.

“Yes, Mr. Romoff made $6 million last year, but what’s interest is he’s not even the highest paid health care executive in the City of Pittsburgh,” said Wood.

Wood says UPMC does about 13 percent of patient revenue in charity care; and back to the mayor’s point, clears additional revenue of $300 million a year over expenses, which is all pumped back into the operation.

“Being a nonprofit doesn’t mean you can’t make a profit. If you don’t make a profit, you can’t reinvest in the businesses, you can’t reinvest in patient care, you can’t reinvest in technology, you can’t maintain your hospitals, things like that,” said Wood. “You don’t make a profit; you go out of business.”

Whether it’s on CBS, this station or anywhere else, the dispute between the mayor and UPMC is not going away anytime soon.

UPMC went to federal court this week to ask a judge to throw out the challenge to its tax-exempt status, a ruling the judge has not yet made.

Mayor Ravenstahl taped the interview with CBS eight weeks ago on April 3.

RELATED LINKS:
Paul Wood Responds To CBS Investigative Report On UPMC (5/30/13)
More UPMC News