The University of Pennsylvania Health System announced $163 million in operating profit in the nine months that ended March 31, according to a notice to bondholders published on May 16.
The number marks a $42 million decrease from last year's reported $205 million operating profit, according to The Philadelphia Inquirer. Revenue for UPHS — the Philadelphia area’s biggest health system by revenue — increased to $8.78 billion, an increase of 8.8% from the $8.07 billion reported last year.
Expenses related to supplies and services rose by 16%, outstripping gains in revenue. UPHS Chief Financial Officer Julia Puchtler attributed the costs to an increase in complex medical services.
"It’s in growing areas like oncology, CAR-T, bone marrow transplants, solid organ transplants," Puchtler said, according to The Philadelphia Inquirer. "Those bring with them higher drug and device costs."
Puchtler remarked that patient numbers were below target levels by 1.5% in a presentation to the Budget and Finance Committee of Penn’s Board of Trustees.
Despite a shortfall of 1,200 surgeries, the number of inpatient procedures still edged up to 30,743 from 30,544. Around half of the decline came from fewer bariatric surgeries, Puchtler noted, underscoring the ongoing influence of GLP-1 weight loss drugs across the healthcare system.
UPHS previously reported $49.3 million in operating income for the first quarter of the 2025 fiscal year and $117 million for the first six months of the 2025 fiscal year.
Last year’s figures were affected by two notable inclusions: a $129.2 million federal Medicare settlement related to a discounted drug program and an $80 million addition to reserves for future medical malpractice claims. Accounting for these two factors, the health system’s financial performance this year is on par with last year’s, according to Puchtler.
The report comes after Penn Med completed its acquisition of Doylestown Hospital in April. The deal, which took over a year to finalize, adds the newly minted Penn Medicine Doylestown Health to the health system’s three hospitals in Philadelphia — the Hospital of the University of Pennsylvania, Penn Presbyterian Medical Center, and Pennsylvania Hospital, along with its three other locations, including Chester County Hospital in West Chester, Lancaster General Hospital in Lancaster, and Princeton Medical Center in Plainsboro, NJ.
