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University of Pittsburgh Medical Center rejects hospital offer

| Friday, Nov. 13, 2009

The University of Pittsburgh Medical Center on Thursday rejected a public challenge by rival West Penn Allegheny Health System to halt plans to build a hospital in Monroeville and keep open UPMC Braddock, the ailing hospital slated to close in January.

Plans will move forward for the Monroeville hospital, in which UPMC has invested about $20 million for demolition and site preparation, said UPMC spokesman Paul Wood.

"As with the recently dismissed federal antitrust lawsuit, we suggest West Penn Allegheny Health System focus on their own grave financial difficulties and operational failings, rather than proposing to eliminate the competition they sued to preserve," Wood said.

West Penn Allegheny proposed UPMC put the $250 million it is using to build the Monroeville hospital toward the cost of maintaining UPMC Braddock and UPMC McKeesport. Patients who would be treated at UPMC Monroeville could instead seek care a mile away at West Penn's Forbes Regional Campus.

West Penn Allegheny is willing to draw up a contract with UPMC Health Plan, so that its members could be treated at Forbes and avoid traveling to hospitals farther away, Dr. Christopher T. Olivia, West Penn Allegheny's CEO, wrote in a full-page ad the Tribune-Review published yesterday.

"They are building a hospital to serve patients in an area that already has a hospital that's been there for 40 years," Olivia said in an interview. Told of UPMC's reaction, he said the offer stands. "I would hope (UPMC) would seriously consider the offer, but that's their decision."

UPMC said it is building the Monroeville hospital to accommodate a growing number of patients from eastern suburbs who come to its Oakland hospitals. About 80 patients from Monroeville, Plum, Murrysville and other areas daily seek care at UPMC Shadyside, said Rob DeMichiei, UPMC's chief financial officer.

"You can question individual decisions ... but we are looking to the long-term and the overall viability of the organization," he said.

UPMC cited low utilization and money problems as reasons for shutting down Braddock, which it has operated since 1996. The hospital lost $27 million in the past six years, and officials projected a $10 million annual loss if it remained open.

Braddock Mayor John Fetterman said West Penn Allegheny has good intentions, but officials at UPMC, including CEO Jeffrey Romoff, have made clear what they want to do.

"The only thing that's going to change Romoff's mind is if he's visited by three ghosts and they convince him one by one to not shutter UPMC Braddock," Fetterman said. "They chose to close this hospital in a dishonorable fashion. No effort was ever made to keep it open. They want to blame the victim, which is despicable and is adding insult to injury."

Olivia said West Penn Allegheny, which posted a net loss of $25.2 million the last fiscal year, does not have the financial muscle to take over UPMC Braddock. But he said UPMC could keep both Braddock and its McKeesport hospital open for 15 years, using the money committed for building the Monroeville facility.

UPMC officials have said they don't plan to close the McKeesport facility.

Olivia said the proposal requires UPMC and West Penn Allegheny to work together despite their bitter rivalry. In a federal lawsuit dismissed last month, West Penn Allegheny accused UPMC and health insurer Highmark Inc. of conspiring to monopolize the region's health care market.

"We can shoot missiles at each other over what happened in the past, or we can put our differences aside and do what's in the best interest of the communities in the east," Olivia said.

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