Upmc

“SECTION A, LINE 1,2,4,7 SECTION B, LINE 11, 12C SECTION A, LINE 1 Although the UPMC board of directors is independent in fact, the Form 990 requires certain board member to be reported as not independent for the purposes of the Form 990. Generally, this is due to the board members' affiliation with companies that provide services to UPMC on the same terms as those offered to the general public or to compensation paid by the University of Pittsburgh, another Section 501(c)(3) organization that UPMC supports, for operational roles. SECTION A, LINE 2 DID ANY OFFICER, TRUSTEE, OR KEY EMPLOYEE HAVE A FAMILY RELATIONSHIP OR BUSINESS RELATIONSHIP WITH ANY OTHER OFFICER, DIRECTOR, TRUSTEE, OR KEY EMPLOYEE? FOR PURPOSES OF PART VI, LINE 2, UPMC HAS OBTAINED AND REPORTED RELEVANT INFORMATION FROM INTERESTED PERSONS INCLUDING DIRECTORS, OFFICERS, AND KEY EMPLOYEES OF UPMC AND OFFICERS AND KEY EMPLOYEES OF ALL GROUP SUBORDINATES, AND DIRECTORS OF GROUP SUBORDINATE ENTITIES WITH DECISION-MAKING BOARD AUTHORITY THAT IS INDEPENDENT FROM THAT OF UPMC PARENT. MULTIPLE UPMC OFFICERS, DIRECTORS, TRUSTEES, AND/OR KEY EMPLOYEES HAVE RELATIONSHIPS BY VIRTUE OF THE FACT THAT THEY ARE ALSO OFFICERS, DIRECTORS, TRUSTEES, AND/OR KEY EMPLOYEES OF UPMC SUBSIDIARIES AND AFFILIATES. THESE RELATIONSHIPS ARE NOT SEPARATELY DISCLOSED BELOW BECAUSE THEY ARE NOT "BUSINESS RELATIONSHIPS" FOR THE PURPOSES OF FORM 990. SECTION A, LINE 7 UPMC DOES NOT HAVE MEMBERS OR STOCKHOLDERS. THE BOARD OF TRUSTEES OF THE UNIVERSITY OF PITTSBURGH SHALL APPOINT DIRECTORS (UNIVERSITY DIRECTORS) EXERCISING ONE-THIRD OF THE TOTAL NUMBER OF VOTES REPRESENTED ON THE BOARD. THOSE DIRECTORS WHO ARE NOT UNIVERSITY DIRECTORS SHALL BE COMMUNITY DIRECTORS EXERCISING THE REMAINING VOTES REPRESENTED ON THE BOARD. CERTAIN COMMUNITY DIRECTORS SHALL BE APPOINTED IN ACCORDANCE WITH CONTRACTUAL COMMITMENTS WITH HOSPITALS OR HOSPITAL-RELATED ENTITIES OR CONSTITUENCIES APPROVED BY THE CORPORATION, AND THE BALANCE OF SUCH COMMUNITY DIRECTORS SHALL BE NOMINATED BY THE GOVERANCE AND NOMINATING COMMITTEE AND ELECTED BY THE BOARD. NO GOVERANCE DECISIONS OF UPMC ARE RESERVED TO OR SUBJECT TO APPROVAL BY MEMBERS, STOCKHOLDER OR PERSONS OTHER THAN THE BOARD OF DIRECTORS. SECTION B, LINE 11 The completed Form 990 was reviewed by the Chief Financial Officer, members of the Corporate Tax Department, members of the Corporate Legal Department, and other members of UPMC management prior to its filing. Various sections of the 990 were also reviewed by the Chief Executive Officer and committees of the filing organization's Board of Directors, as applicable. For example, the Executive Compensation Committee of the Board reviewed sections related to compensation and related party transactions. In addition, the Board of Directors established a 990 Subcommittee, comprised of the Chairs of the Board, Executive Compensation Committee, Ethics and Compliance Committee, Finance Committee and Audit Committee, which reviewed the entire completed Form 990 prior to filing. Additionally, the Form 990 is reviewed by an outside independent public accounting firm who as part of the process signs the return as Paid Preparer. After this review but prior to filing, the full Board of Directors was notified that the completed Form 990 was available for review on the Board's secure website. Also prior to filing, management provided the opportunity for all board members of the full UPMC board to ask any questions or raise any comments on the full return they were provided. SECTION B, Line 12c: UPMC, as a system-wide practice, requires key employed and non-employed personnel to comply with its conflict of interest policies when they engage in UPMC-related business. Individuals covered by the policies include: UPMC board members, corporate officers, and key employees, UPMC physicians and non-physician employees who hold a position of influence, Identified Non-employed members of the UPMC medical staff who hold a position of influence, and”

“Section B, Line 15a and b: As a system-wide practice, to support UPMC's mission and as set forth in the UPMC Bylaws, the Board of Directors has formed an Executive Compensation Committee ("Committee") and delegated to it the responsibility for establishment and implementation of officer and key employee total compensation programs. As part of this responsibility, the Committee reports regularly to the Board of Directors. With Board of Directors approval, the Committee has adopted a formal Charter, which includes the establishment of a compensation philosophy and related policies with respect to the total compensation paid by UPMC to its officers and key employees. The UPMC total compensation program for officers and key employees includes an incentive compensation component. This component is based upon the accomplishment of predetermined performance goals and objectives which focus on the achievement of multiple annual and three year individual and group performance criteria in the context of appropriate risk taking. These criteria directly support UPMC's mission and include patient quality and satisfaction, community benefits, operational and financial strength, leadership development, and strategic business initiatives among others. The total compensation program is integrated with and reinforces the UPMC business planning cycle as well as management development and succession planning processes. It is the Committee's judgment that the structure of the total compensation program is vital to, and strongly supportive of, the high level of ongoing success of UPMC and fosters the retention of critical officer and key employee talent. The total compensation determination process utilized by the Committee is intended to satisfy the "rebuttable presumption of reasonableness" as set forth in the regulations to Section 4958 of the Internal Revenue Code ("Code"). This means that compensation programs and levels are approved in advance by the Committee which is composed entirely of outside Directors who do not have a conflict of interest, as defined by the Code, with respect to the compensation program and levels. The Committee obtains and relies upon a broad range of appropriate data as to comparability prior to making its determinations. The Committee then contemporaneously documents, in formal meeting minutes, the basis and reasons for its determinations. The total compensation program is designed and administered in accordance with the UPMC Bylaws, sound business practices, the tenets of common law business judgment and fiduciary responsibility as well as adherence to all relevant federal, state and local laws. In addition to Code Section 4958, as set forth above, this includes but is not limited to Code Section 501(c)(3) and the applicable regulations thereunder as well as all laws and regulations prohibiting private inurement, private benefit transactions and discrimination. Further, the Committee has identified and adopted, as appropriately modified for UPMC, compensation program "best practices" from the business world (e.g. Sarbanes Oxley, other SEC regulations, etc). The Committee believes that while these practices are not required in the tax-exempt sector, they are in the best interests of the organization and further support UPMC's nonprofit mission. In accordance with the above, determination of total compensation for the CEO is made exclusively by the Committee. Determination of total compensation for other officers and key employees is recommended by the CEO and subject to review and approval by the Committee. The Committee, which meets at least four times a year, obtains professional advice from its own experts, including accountants, executive compensation consultants and legal counsel. SECTION B, LINE 16A AND B: UPMC has a formal written policy pertaining to joint ventures between UPMC Tax-Exempt entities and taxable entities. The policy employs an internal procedure for review of all transactions involving potentia”

“SECTION A AND SECTION B SECTION A Pursuant to Treasury Regulation Section 1.6033-2(d)(5), UPMC has elected to report compensation and Schedule J other information about officers, directors, trustees, key employees and certain other highly paid employees on a consolidated basis for all of the members of the UPMC Group, including this parent organization which is the sponsor or central organization of the Group, on the return of UPMC Group, EIN 20-8295721. SECTION B Pursuant to Treasury Regulation Section 1.6033-2(d)(5), UPMC has elected to report certain professional contractors and certain other contractors on a consolidated basis for all of the members of the UPMC Group, including this parent organization which is the sponsor or central organization of the Group, on the return of UPMC Group, EIN 20-8295721.”

“Line 1 - Contributions and grants: Pursuant to Treasury Regulation Section 1.6033-2(d)(5), UPMC has elected to report information related to its contributions and grants received on a consolidated basis for all of the members of the UPMC Group, including this parent organization, on the return of UPMC Group, EIN 20-8295721.”

“UPMC is the parent organization of a large integrated healthcare delivery system consisting of controlled subsidiaries within the meaning of Section 6033(h). UPMC'S primary mission is the ongoing support of all subsidiaries in order to assist them in accomplishing their exempt educational, healthcare, and research missions. Line 8 - Contributions and grants: Pursuant to Treasury Regulation Section 1.6033-2(d)(5), UPMC has elected to report information related to its contributions and grants received on a consolidated basis for all of the members of the UPMC Group, including this parent organization, on the return of UPMC Group, EIN 20-8295721.”

“UPMC, a world-renowned health care provider and insurer, is inventing new models of patient-centered, cost-effective, accountable care. With a central mission of providing outstanding, accessible patient care, UPMC is shaping tomorrow's health care through clinical and technological innovation, research, and education. As the largest nongovernmental employer in the Commonwealth of Pennsylvania - with 100,000 employees within its various controlled health care entities - UPMC encompasses more than 40 hospitals and 800 doctors' offices and outpatient sites. By integrating its health care services with an insurance division focused on promoting the health of its members, UPMC is advancing the quality and efficiency of health care, and developing internationally renowned programs in transplantation, cancer, neurosurgery, women's health, psychiatry, geriatrics, orthopedics, and sports medicine, among others. These highly specialized services draw patients from across the nation and around the world. Closely affiliated with its academic partner, the University of Pittsburgh, UPMC's flagship hospital, UPMC Presbyterian Shadyside, is consistently ranked among the nation's best hospitals in many specialties by U.S. News & World Report. UPMC's Health Services Division encompasses a comprehensive array of clinical capabilities. This division includes academic, community, and regional hospitals; pre- and post-acute care capabilities; specialty service lines, such as transplantation services, women's health, behavioral health, pediatrics, cancer care, and rehabilitation services; contract services, such as emergency medicine, pharmacy, and laboratory; and more than 5,000 employed physicians with associated practices. UPMC's organ transplant center is one of the largest and busiest in the world, performing more than 20,000 transplants since 1981. The UPMC Hillman Cancer Center is one of the largest integrated community cancer networks in the United States with more than 70 centers in Pennsylvania, Ohio, New York, and Maryland, and more than 2,000 physicians, researchers, and staff. UPMC's expertise in academic-based and specialized medical care, including transplantation, oncology, and sports medicine, is key to the globalization efforts being undertaken through its International Division, which promotes the exchange of scientific knowledge worldwide, while generating revenue that is reinvested locally. In managing its global health enterprise, UPMC has taken a leadership role in good corporate governance practices - voluntarily achieving Sarbanes-Oxley certification for nineteen years in a row, publicly releasing quarterly financial results within 60 days of each quarter's close and creating one of the most stringent industry relationship policies to ensure that pharmaceutical and medical device companies do not negatively influence patient care. These business practices set the stage for decision making that is good for UPMC and the communities it serves. High-Quality, Patient-Focused Care By leveraging resources and expertise across its global network, UPMC has achieved significant gains in the delivery of high-quality, patient-focused care that is evidence-based. The Wolff Center at UPMC coordinates and connects quality, safety, patient care, and innovative improvements to ensure patients receive the highest quality care. The Wolff Center partners with colleagues across UPMC to improve health care delivery for patients and health plan members. These collaborations support effective and efficient care transformations to achieve high-quality and safe outcomes. The Wolff Center's expertise includes enterprise-wide quality data and analytics to inform initiatives that target operational excellence, patient and employee experience, quality care and process improvement, and regulatory, patient safety, and emergency preparedness. In fiscal year 2024, the Wolff Center continued to provide leadership and infrastructure to optimize the workforce”

“Investments in Technology and Facilities Underpinning UPMC's quality and patient safety efforts is a robust technology infrastructure. Over the past five years, UPMC has invested $4.4 billion in new facilities, equipment, and information technology to make care more convenient and accessible across the region, and its hospitals are among the most advanced users of electronic health records, as measured by HIMSS Analytics, a subsidiary of the Healthcare Information and Management Systems Society (HIMSS). For 26 consecutive years, UPMC has been named a Most Wired health care system by the Digital Health Most Wired survey from the College of Healthcare Information Management Executives. In 2024, UPMC received the highest honor and was recognized as a Level 10 health care system. This solidifies UPMC as a leader in health care technology and demonstrates that UPMC's technology is at the forefront of improving the health care journey for both patients and staff, through innovative technologies that are automated, reliable, secure, and patient focused. In 2024, UPMC continued to make progress on an enterprise-wide initiative to unify our Electronic Health Record (EHR) to a single platform, with an aim of advancing clinical and operational excellence and patient experience. UPMC is also partnering with leading technology companies and innovative startups to develop and bring to the public the next generation of health care information technology. In keeping with its goal of ensuring access to high-quality health care, UPMC continues to invest in world-class facilities and clinical services - in 2024, UPMC spent $995 million on capital improvements. Support for Research and Education In concert with its academic partner, the University of Pittsburgh, UPMC is translating biomedical research into innovative clinical care, while training the clinicians and researchers who will advance health care in the decades to come. UPMC's financial support for research and education - primarily at the University of Pittsburgh - was $ 626 million in fiscal year 2024. UPMC's ongoing support has aided the University in remaining among the top 10 recipients of National Institutes of Health (NIH) grants since 1998. This success keeps both organizations on the cutting edge of medical research, while bringing nearly $700 million of NIH funding to the region. The results of this research are widely shared with other scientists and researchers, leading to discoveries and improvements in health care practices that benefit the public. UPMC underwrites the training of more than 1,900 medical, pharmacy, dental, and podiatry residents, and medical clinical fellows. UPMC also operates seven schools of nursing, offers training for allied health professionals, and coordinates a wide array of continuing medical education programs to allow the region's medical community to build its collective expertise. Caring for the Community In fiscal year 2024, UPMC spent $ 745 million to provide uncompensated care to patients of limited financial means, including financial assistance and shortfalls from medical assistance and other means tested programs. UPMC's financial assistance program has been designed to be easily accessible and user-friendly to patients in need. UPMC operates pursuant to an expansive financial assistance policy that extends free or discounted health services to uninsured and underinsured individuals and families earning up to 400 percent of the federal poverty level - as much as $124,800 for a family of four in 2024. Additionally, in fiscal year 2024, UPMC spent over $1.3 billion to cover payment shortfalls for those enrolled in Medicare. UPMC annually provides or contributes to more than 3,000 community health improvement programs and subsidized services. Many of these programs target the unmet needs of vulnerable populations, addressing chronic health problems such as diabetes, heart disease, and cancer, as well as social issues such as opioid addiction”

“Line 2 - Contributions and grants: Pursuant to Treasury Regulation Section 1.6033-2(d)(5), UPMC has elected to report information related to its contributions and grants on a consolidated basis for all of the members of the UPMC Group, including this parent organization, on the return of UPMC Group, EIN 20-8295721. LINE 12 - AN EXTERNAL AUDIT IS COMPLETED AT A CONSOLIDATED UPMC SYSTEM LEVEL ONLY, INCLUDING UPMC AND ALL TAXABLE AND TAX EXEMPT SUBSIDIARIES.”

“LINE 15 UPMC does not have a Section 4960 excise tax liability to report on Form 4720 related to payments of $1 million or more in remuneration or excess parachute payments during its tax year ended June 30, 2023. Remuneration is not taken into account for the purposes of the excise tax if no deduction for the remuneration is allowed by reason of section 162(m). Section 162(m)(6) imposes a compensation deduction limitation on controlled groups, such as the UPMC controlled group, that include one or more covered health insurance providers.”

“Line 9 other changes in net assets or fund balances dividends received 250,000,000 investment in affiliate 93,768,010 foreign currency exchange rate adjustment 19,716,603 other changes to fund balance 1,091,247 pensions and post retirement benefit (6,144,241) net transfers to exempt subsidiaries (358,598,689) total other changes in net assets or fund balances (167,070)”

“Question 2b : the organization's financial statements are part of a consolidated financial statement audit performed by ey for upmc and all subsidiaries. The entire system's financial statements, of which this organization is part of, are posted on the upmc website. (www.upmc.com) the financial statement audit during the 990 filing period is for the calendar year ended december 31,2023. Question 2c upmc has an audit committee that is established to assist the board of directors in fulfilling its oversight responsibilities by monitoring upmc consolidated financial reports and other financial information provided by upmc to governmental bodies, the public or other external entities. The upmc's system of internal controls regarding finance, accounting, legal compliance and ethics that management and the board have established and upmc's internal auditing, accounting and financial reporting processes also provided oversight.”