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Paul Wood Responds To CBS Investigative Report On UPMC

By Nick Kratsas- KDKA Morning News
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(Photo Credit: KDKA)

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PITTSBURGH (NewsRadio 1020 KDKA) – KDKA-AM’s Larry and John spoke to UPMC spokesperson Paul Wood about what was reported this morning on ‘CBS This Morning.’ Mr. Wood says much of the information was distorted or misrepresented.

The CBS Network News reported that last year UPMC made almost a billion dollars in excess revenue, while at the same time claiming a non-profit status that shields them from being taxed like for-profit companies. It was on this impetus that CBS Network News Correspondent Terrell Brown came to Pittsburgh to interview Mayor Luke Ravenstahl about the hospital’s non-profit status and look into why the city is suing to have it revoked.

“If CBS [Network News] is going to do an investigative piece, they have at least the responsibility to present the facts,” Wood said.

The report includes charges of high salaries, $200 million tax breaks for non-profit status, huge spending on what some experts believe are unneeded upgrades to preexisting facilities, shutting down hospitals in poorer areas in exchange for opening ones in more affluent neighborhoods, driving the price of healthcare up, and not paying their fair share to local charities and government entities.

According to the report, Romoff earned nearly $6 million last year, has a personal staff that makes nearly $1 million combined, occupies office space in the expensive upper levels of the US Steel Tower, and has access to a chef, chauffer, and jet. Wood defended the charge that Romoff is the most-paid health executive in the country, saying he’s not even the most-paid health executive in Pittsburgh.

“That distinction goes to Chris Olivia (President and CEO of West Penn Allegheny Health System), who over the past two years has made more money than Mr. Romoff,” Wood said.

Wood also said, “Mr. Olivia has the distinction of taking a very poorly run West Penn Allegheny Health System and driving it straight into the ground, into bankruptcy.”

Wood continued on, saying that non-profits are allowed to pay their employees at fair market value. He also says that there are several other health executives across the country who make more than Romoff, and that a simple Google search would show this.

“There is no private chef, there is no chauffer,” says Wood. “The allegation that we have the most expensive office spaces in the city is dead wrong. We moved from Oakland, which is much more expensive area to lease than Downtown, into space at the US Steel Tower that is much less expensive than the space we had in Oakland.”

As for closing hospitals in poorer neighborhoods to open ones in more affluent locations, Wood says this is in reference to the closing of Braddock Hospital and opening the new hospital in Monroeville. He says Braddock Hospital was closed because it wasn’t being used.

“It had an occupancy rate well under 50 percent. Hospitals cannot operate and survive with an occupancy rate that low. The community around that hospital simply was not using that hospital,” Wood said.

Wood claims that CBS Network News was used as a mouthpiece for the mayor’s office, who is currently suing UPMC to revoke their non-profit status. He pointed out that most of the information in the piece was cited as coming from the City of Pittsburgh, and went on to say that despite CBS Network News’ claims that UPMC would not comment, Wood says he did offer comment, but that CBS Network News only wanted to speak to CEO Romoff.

UPMC’s non-profit status is legal and fair, says Wood. According to Wood, UPMC is a 501c tax exempt organization, and fills the government criteria to have that status.

“We have to provide to the public a service that the government would otherwise be obligated to provide,” says Wood. “Pennsylvania is the only large state in the nation that doesn’t have a public hospital system. If not for UPMC, the responsibility for providing charity care and uncompensated care for the uninsured would fall to the city or the county, and its tax payers.”

Hear the full story in Larry and John’s interview below.

Part 1:

Part 2:

John McIntyre filled in for Mike Pintek Thursday on NewsRadio 1020 KDKA and spoke with Martin Gaynor, Carnegie Mellon Professor, E. J. Barone Professorship of Economics and Health Policy. He was interviewed in Brown’s CBS Network News story.

Listen to the interview below:

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