Kaiser Permanente generated $2 billion in net income in the third quarter, as the system was buoyed by increases in patient care after major declines due to COVID-19.
The major system’s financial statements (PDF), released late Friday, showed Kaiser’s earnings were above the $1.2 billion it generated in the same period in 2019. The system said that more patients are starting to return to the hospital.
“Although the pandemic continues to have an impact on Kaiser Permanente, during the third quarter we safely resumed in-person preventive and elective care, started to address the backlog of deferred procedures that were put on hold due to COVID-19, and continued to leverage and grow virtual care members’ safety and convenience,” said Kathy Lancaster, the system’s executive vice president and chief financial officer.
Kaiser reported $22 billion in total operating revenues for the third quarter compared with $20.9 billion in the third quarter of 2019.
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But the system has more operating expenses ($21.5 billion) in the third quarter compared to the same period in 2019 ($20.3 billion). Hospitals across the country have faced higher prices for supplies such as personal protective equipment and staffing to combat COVID-19.
Kaiser also reported earnings for the nine months of 2020 through September, generating $66.6 billion in operating revenues compared with $63.7 billion in the same period in 2019.
“Year-to-date net income was $5.4 billion compared to $6.4 billion for the same period in 2019,” Kaiser said.
However, Kaiser Permanente’s insurance business saw some declines. Membership declined by 11,000 members during the third quarter to 12.4 million.
The system cited job losses due to COVID-19 as the reason.
“In Kaiser Permanente markets, unemployment ranged from 6.6% to 13.9% at the close of the third quarter,” Kaiser’s release said. “Strong membership growth early in the year was sustained because of efforts on the part of the government, employers and Kaiser Permanente to help people maintain their health benefits during a period of unprecedented healthcare and economic challenges.”
Kaiser is the latest healthcare system to post an uptick in income in the third quarter as care levels started to rebound after precipitous declines in the second quarter. Hospitals across the country were forced to shutter elective surgical procedures to preserve capacity to fight COVID-19, and patients were scared to come to hospitals for non-COVID-19 care.
Major for-profit system HCA Healthcare reported $668 million in profits in the third quarter based on revenue of $13.3 billion.
It remains unclear how Kaiser will fare as COVID-19 cases have started to surge across the country over the past few weeks.