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May 1, 1997

Pitt, UPMCD, UPMCS: Keeping it all straight is difficult

The relationships between Pitt, its University of Pittsburgh Medical Center Division (UPMCD) and the separate corporation called the University of Pittsburgh Medical Center System (UPMCS) are so complex that even Pitt's Board of Trustees was fuzzy about them.

So last year, the board's health sciences committee undertook a special project to trace the histories of UPMCS and UPMCD, and sort out the relationships among those entities and Pitt. The Board of Trustees released its report last June.

Since then, Presbyterian University Hospital (trade name: UPMC) has merged with Shadyside Hospital, among other UPMCS moves. Now, a new University Senate ad hoc committee is planning to examine Pitt and "the two UPMCs," focusing on possible conflicts between the University's academic mission and UPMCS's business goals. See stories on this page and in the April 17 University Times.


The Pitt-UPMC puzzle includes the following pieces, among others:

The University of Pittsburgh Medical Center Division (UPMCD) is a division of Pitt that implements the management contracts between the University and PUH-Shadyside/UPMCS. In addition, UPMCD is responsible for fiscal administration of Pitt's School of Medicine and research portions of the University of Pittsburgh Cancer Institute and Western Psychiatric Institute and Clinic, and administration of associated University buildings. UPMCD executive staff are Pitt employees. UPMCD is self-supporting; it must produce sufficient revenue to cover its operating budget.

Prior to an October 1990 vote by Pitt trustees, UPMCD was called the "University of Pittsburgh Medical and Health Care Division." The Pitt School of Medicine educates University medical students and promotes faculty research and teaching. The school's physician faculty provide patient care at PUH-Shadyside/UPMCS. While UPMCD handles the school's fiscal administration, academic decisions within the school must be approved by Pitt's senior vice chancellor for Health Sciences in consultation with the provost.

Other Pitt Health Sciences schools include the schools of dental medicine, nursing, pharmacy, health and rehabilitation sciences, and the Graduate School of Public Health. Pitt's senior vice chancellor is responsible for both academic and fiscal administration decisions within these schools.


The University of Pittsburgh Medical Center System (UPMCS) is a corporation that is legally separate and distinct from the University, with its own funding sources. Under state law, UPMCS is considered to be a "non-profit" corporation. Under federal law, the designation is "charitable, non-taxable." By either definition, UPMCS oversees a growing health care system that includes some 80 corporate entities, including two tertiary care hospitals (Presbyterian University Hospital and Shadyside Hospital), four community hospitals (UPMC Beaver Valley, UPMC Braddock, UPMC South Side and UPMC St. Margaret) and a new, for-profit organization called Community Resource Management, Inc.

Community Resource Management, Inc. is the for-profit arm of UPMCS. Still in its beginning stages, the organization will manage a number of assisted living facilities, in-home services and other community-based services and facilities that were brought under UPMCS when St. Margaret Memorial Hospital elected to merge into the system.

Presbyterian University Hospital (PUH) is a charitable, non-profit corporation owned by UPMCS, although the Pitt medical school's relationship with PUH dates from the early 1900s. The current PUH resulted from mergers between the former Presbyterian Hospital and Montefiore Hospital, Eye and Ear Hospital, Falk Clinic and clinical components of Western Psychiatric Institute and Clinic.

On March 31, PUH merged with Shadyside Hospital. The two hospitals operate as one clinically and administratively integrated economic unit, with UPMCS as their parent corporation.

Both hospitals are governed by a joint board of directors. PUH appoints one-third of the board, Shadyside appoints another third, and Pitt appoints the remaining third.

A plan is "in the works" to change the hospitals' trade names, respectively, to the University of Pittsburgh Medical Center, Presbyterian (or UPMC Presbyterian, for short) and the University of Pittsburgh Medical Center, Shadyside (UPMC Shadyside), said George A. Huber, UPMCS vice president and counsel. The name changes will require approval from the PUH-Shadyside joint board and from Pitt, Huber said.

St. Margaret Memorial Hospital elected to merge into UPMCS as a subsidiary corporation on March 1. The hospital appoints 60 percent of the new corporation's board. UPMCS appoints the remaining 40 percent. The new corporation is now known as UPMC St. Margaret.

Negotiations are underway for North Hills Passavant Hospital to merge into UPMCS with the same status as St. Margaret.

UPMC Beaver Valley (formerly Aliquippa Hospital), UPMC Braddock (formerly Braddock Hospital) and UPMC South Side (formerly South Side Hospital) are "UPMCS-acquired" community hospitals. Each of the hospitals reached an agreement with the system whereby UPMCS, in order to expand its network, agreed to pay to enhance the hospital or to put money into a hospital foundation, which then uses the funds for community health and welfare programs. UPMCS appoints two-thirds of each hospital's board members.


Missing from this list is an entity called the University of Pittsburgh Medical Center. That's because, legally, there is no such thing — yet. "University of Pittsburgh Medical Center" is merely a registered trade name, although UPMCS officials plan to ask Pitt's permission to change the system's name officially to the "University of Pittsburgh Medical Center." In December 1992, Pitt granted Presbyterian University Hospital (PUH) permission to use the term "University of Pittsburgh Medical Center" for the hospital's listings in telephone directories. Two years later, the University permitted PUH broader use of the term, including use of the University of Pittsburgh name and logo.

Meanwhile, in June 1993, Pitt gave its consent to PUH's parent corporation (then called the Presbyterian University Hospital System, Inc., or PUHSI) to use the term "University of Pittsburgh Medical Center System." PUHSI later changed its legal corporate name to UPMCS.

Now, following its merger with Shadyside Hospital, PUH wants to change its trade name from the current "UPMC" to "UPMC Presbyterian." UPMCS, in turn, will seek Pitt's permission to change its own legal corporate name to the "University of Pittsburgh Medical Center" (UPMC).

Pitt retains the right to revoke use of the term "University of Pittsburgh Medical Center" by UPMCS and its hospitals, without giving cause and upon 90 days' written notice.

— Bruce Steele

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