The following report was obtained by Labor Research Associates, an independant research firm out of New York, New York. They were hired by the PSEA. This is your union dues at work.

As you know, South Hills is a health system with several members. The largest member, by far, is Jefferson Hospital. 1998 was not a good year financially for Jefferson. In 1997, it barely managed to stay profitable. In 1998, however, it lost money. Although Operating revenue increased 4.37% between 1997 and 1998, operating expenses increased even faster by 5.8%. This resulted in a loss of $1.09 for the year – a profit margin of –0.803%. Additionally, their net worth decreased by almost $604,000. This came after several years of profitability.

Jefferson’s losses, however, need to be kept in perspective. Although the facility lost money, South Hills Health System, the parent organization, was very profitable. They earn money from two sources. The first is the sale of assets and investment income – primarily publicly traded securities. In 1998, it earned $13,422,160 through this method. Its other large source of income is by charging its affiliated organizations fees for corporate support services. This includes administrative, financial, and marketing services. In 1998, it earned $16,542,037 through this method. Jefferson Hospital contributed 96.9% of this.

In 1998, they earned $36.7 from asset sales and corporate fees, however, expenses were only $23.1 million. This gave the company a total profit of $13.6 million in 1998 – an enormous 37% profit margin. Although Jefferson may have lost money, South Hills earnings were almost 13 times as large.

We hope this information was helpful. If you need a more detailed update or any other information, we would be glad to help.