Some Tax-Exempt Hospitals Are Building Real Estate Empires

An investigation by The Lever reveals how nonprofit hospital giants are dodging taxes, hoarding land and influencing elections — while giving back less to communities than they take in subsidies.

A new investigation by The Lever has exposed how some of America’s most powerful hospital systems — those enjoying the protections and privileges of nonprofit status — are quietly amassing vast real estate empires, tax-free. The report zeroes in on the University of Pittsburgh Medical Center (UPMC), a health care behemoth that now owns more than $2 billion in tax-exempt property in Allegheny County alone, raising serious questions about whether these institutions are fulfilling their public mission — or simply getting rich.

Before I left Cigna to blow the whistle on the health insurance industry, I worked at Humana — back when it was still largely a hospital company. Even then, I witnessed how these institutions increasingly focused on financial growth rather than patient outcomes. But the scale and sophistication of today’s hospital land grabs are more impressive than I could have imagined. 

UPMC’s outsized market dominance, now the subject of a federal class-action suit over labor practices, shows how these monopolies are not just driving up prices — they’re reshaping entire cities.

According to the Lown Institute, 80 percent of nonprofit hospitals are failing to return even the value of their tax breaks back into their communities. In Pennsylvania, UPMC’s Presbyterian Shadyside hospital alone had a “fair-share deficit” of $246 million—money that should have gone to helping patients but instead subsidized executive pay and international expansions. UPMC even spent $50 million on a corporate jet, while one in five Pittsburgh residents lives below the poverty line. 

What’s worse, UPMC appears to be leveraging its tax-subsidized fortune to influence local democracy. The Lever uncovered that board members of UPMC and its Children’s Hospital Foundation have poured at least $25,000 into the campaign of County Controller Corey O’Connor, who is challenging Pittsburgh’s progressive mayor, Ed Gainey. Gainey has dared to question whether UPMC’s sprawling real estate holdings truly deserve tax-exempt status. Once a supporter of the mayor’s scrutiny, O’Connor quickly reversed course after the money started flowing in.

As the producer of the documentary American Hospitals: Healing a Broken System, I’ve heard from so many patients, doctors and advocates about how nonprofit hospitals are too often run like Wall Street firms — prioritizing expansion, executive compensation, and political influence over care. And this latest reporting from The Lever, bolstered by new data from the nonpartisan Lown Institute, shows just how ingrained this problem has become.

Tax exemptions were never meant to help hospitals become real estate giants or political kingmakers. They were intended to support providers in delivering care to those in need. But as this report makes clear, we are long past that point. It’s time for lawmakers—and the public—to ask: what exactly are we getting for the billions in tax subsidies handed out each year? If the answer is jets, lawsuits, and political meddling, then our nonprofit hospitals aren’t broken. They’re rigged.