UPMC expansion reaching historic proportions

Health giant acquires 7 central Pa. hospitals

With the stroke of a pen, UPMC has acquired seven hospitals in central Pennsylvania, with plans to buy an eighth in York and build a 90-bed hospital in South Fayette — fueling the biggest expansion in the Pittsburgh health care giant’s 27year history.

The deal to acquire Harrisburg-based Pinnacle Health System comes within a week of UPMC getting municipal approval to build a $211.2 million hospital in South Fayette. The health system already operates about 20 hospitals, mostly in Western Pennsylvania.

The move into central Pennsylvania is good news for the integrated health care system, which can use the new hospitals as a way to introduce its health insuranceproducts, said Vikram Mangalmurti, co-founder of Shadyside-based management consultantTonic Advisors.

“It’s great for UPMC, fantastic,” said Mr. Mangalmurti, a lawyer and former Highmark vice president. “They’re tapped out for growth in Western Pennsylvania.”

UPMC referred comment to Pinnacle, which said in a statement that it expects the deal to close by early fall.

UPMC perfected the practice of acquiring and integrating hospitals during a growth phase in the 1990s, Mr. Mangalmurti said, when it had little competition. And central Pennsylvania is fertile ground for an integrated health care delivery