Banner Health has continued to experience financial headwinds, posting a $57.2 million loss in the first nine months of the year compared to earnings of $393.4 million in the same period a year earlier.
The Phoenix-based nonprofit health system reported revenue reached nearly $7.3 billion in the first nine months of the year, up from about $7 billion at the same time in 2019, according to the health system's latest unaudited financial statement (PDF).
However, its expenses were also up, topping $7.1 billion for the first nine months of the year, up from $6.9 billion in the corresponding period. That was due, in part, to increased salary and benefits costs (5%) and an uptick in the cost of supplies (6%).
Banner also reported a loss of $4.7 million in investment income year-to-date compared to investment earnings of $430 million for the same period in 2019.
Overall, Banner Health generated $154.2 million in operating income in the first nine months of the year, up about 32% from the $116.5 million in the third quarter of 2019. That reflects an improvement from earlier this year when the health system reported its operating income was down in the first half of 2020.
For the first nine months of the year, Banner has posted $5.29 billion in net patient service revenue, up from $5.25 billion in the same period of 2019. That was also an improved trend from the first half of the year.
Still, health systems continue to report weakened performance overall for the year compared to 2019 due to increased expenses in the ongoing response to COVID-19 surges, canceled elective procedures and deferred care among patients. Many reported revenues have largely been bolstered by federal relief dollars.
Banner has received approximately $436 million in CARES Act relief funding as of the end of the third quarter, with about $258 million of those funds recognized as other operating revenue year-to-date. Banner also received $621 million in Medicare Advance and Accelerated Payments as part of federal COVID-19 relief.
Banner established a new line of credit totaling $150 million from Bank of America during the second quarter of 2020. Along with Banner’s bank syndicated credit facility of $400 million, the health system has access to $550 million in lines of credit.
On Sept. 28, Banner drew $200 million on the syndicated credit facility for the pending acquisition of Wyoming Medical Center, a 249-licensed bed general acute care hospital with two campuses in Casper, Wyoming, together with a related medical group and other ancillary operations.