UPMC creating modern ‘company towns,’ dominating workers and dictating prices, lawmakers claim – PennLive

Note: this article was updated to include a response from UPMC.
Medical giant UMPC is bent on monopolizing health care, while also ignoring its non-profit responsibility to benefit rather than exploit communities, a pair of western Pennsylvania lawmakers and an anti-corporate advocate said on Thursday.
The result is “soaring costs, lower quality of care, less price transparency and lower wages, worse working conditions and weakened bargaining power and risk of retaliation for our hospital employees,” said U.S. Rep. Summer Lee, a newly-elected Democrat from the Pittsburgh region. Lee was previously a state representative.
Lee and state Rep. Sara Innamorato, another Pittsburgh-area Democrat, described the alleged wrongdoings of UPMC while also citing findings from a report by the American Economic Liberties Project.
According to the report, Pittsburgh-based UPMC, with 92,000 employees, is Pennsylvania’s largest non-government employer. It has been on an expansion binge, growing from a dozen hospitals in western Pennsylvania a decade ago to 40 today.
Most of its expansion has occurred in Pennsylvania counties east of Pittsburgh, including seven hospitals in central Pa. As a result, UPMC’s critics called on lawmakers throughout Pennsylvania to watch UPMC and listen to its employees and patients, saying the situation in western Pennsylvania may well spread.
UPMC said it will need more time to fully respond to the report, which it said seems to contain information that was previously “debunked.” UPMC noted it recently announced it will begin offering an $18-an-hour starting wage in central Pennsylvania by 2025, with new employees who take full advantage of benefits including health care coverage and retirement savings match earning the equivalent of $27 an hour.
In Allegheny County, UPMC controls three out of every four hospital jobs, according to the economic liberties project report.
Speakers on Thursday accused UPMC of tactics including union busting, paying near-poverty-level wages for some employees, using tuition repayment programs to “trap” employees, and using its power as a buyer to depress prices it pays for goods and services, thereby harming other businesses.
The speakers said UPMC hospitals have become the major employers and economic engines in former steelmaking and manufacturing communities in western Pennsylvania, and likened them to “company towns” in the sense of having too much power over the local economy and labor.
“The local economy is still overly dependent on a few large employers that tightly control the job market. The names may be different, but in many ways, Pittsburgh and vast swathes of Allegheny County should still be considered company towns,” the report states.
The report further said UPMC fails to live up to its obligation as a non-profit receiving assorted tax breaks, with UPMC receiving “far more from taxpayers than it pays out in terms of real benefits to the community.”
UPMC also operates a health insurance business covering 4 million people, with the critics saying it uses its health insurance arm to further force patients to use its services.
The speakers on Thursday called for a range of government actions they said are necessary to curb UPMC, including a state antitrust law to limit the power hospitals gain through consolidation; giving the Federal Trade Commission more power to regulate non-profit hospitals; preventing hospitals from interfering with workers trying to unionize; and reforms that would limit hospitals’ ability to set prices or refuse certain health insurance.
The Democratic lawmakers were asked Thursday what chances their proposed reforms have of passing in a Pennsylvania legislature controlled by Republicans, and a U.S. House also controlled by Republicans.
Innamorato replied that UPMC has expanded into many Pennsylvania communities represented by Republicans, and held out hope those Republicans will recognize the impacts on their constituents and agree on the need for reforms.
UMPC has made a strong move into central Pennsylvania during the past half-dozen or so years, acquiring hospitals in Dauphin, Cumberland, York and Lancaster counties, as well as to the north in Williamsport and Lock Haven.
In most of those communities, there is at least one other major health system, such as Penn State Health, WellSpan, Geisinger or Penn Medicine Lancaster Health, preventing UPMC thus far from attaining the same level of dominance as in western Pennsylvania. In the Pittsburgh region, UPMC’s main competition comes from the smaller Allegheny Health Network, which was near collapse before it was taken over by health insurer Highmark about a decade ago.
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