Oakland, Calif.-based Kaiser Permanente reported higher revenue and net income for its nonprofit hospital and health plan units in the first quarter of 2019.
Kaiser saw operating revenue increase to $21.3 billion in the first quarter of 2019. That’s up 5.3 percent from operating revenue of $20.3 billion in the first quarter of last year.
The boost was partly attributable to the system’s health plan unit. Kaiser saw health plan membership increase year over year to 12.3 million.
“We are pleased that our membership increased by more than 150,000 members in the first quarter, as more people are choosing Kaiser Permanente for their care and coverage,” Kaiser Executive Vice President and CFO Kathy Lancaster said in a press release. “We normally see our largest membership growth in the first quarter due to the fall open enrollment cycle.”
After factoring in operating expenses, which increased 3 percent year over year, Kaiser reported operating income of $1.5 billion in the first quarter of 2019. That’s up from $1.1 billion in the first quarter of 2018.
“This year-over-year increase in Q1 operating income was significantly impacted by several accounting estimates that were favorable when compared to the same period last year,” Kaiser said.
Kaiser’s nonoperating income, generated largely by returns on investments, was $1.6 billion in the first quarter of this year, up from $334 million in the same period a year earlier.
Under an accounting change that took effect Jan. 1, Kaiser reported unrealized gains on certain equities as net nonoperating income, which added $896 million to the organization’s nonoperating income in the first quarter of this year.
Kaiser reported net income of $3.2 billion in the first quarter of 2019, more than double its net income of $1.4 billion in the first quarter of last year.
Ms. Lancaster said Kaiser’s strong first-quarter performance will allow for more strategic investments in facilities, people and technology. During the first quarter of 2019, Kaiser said it spent $834 million on technology and upgrading and opening new facilities.