Kaiser Profits Decline to $1.6B in Q3 Due to Increased Expenses from COVID-19 Surge

Kaiser Permanente posted a $1.6 billion profit for the third quarter, which is down by nearly half from the $3 billion it generated in the previous quarter.

The 39-hospital system and health plan’s earnings, reported Friday, were affected by a major surge of COVID-19 that caused expenses to increase. Kaiser Permanente’s hospital system and health plan reported total operating revenue of $23.2 billion and expenses of $23 billion.

Overall, the system’s operating income declined to $38 million for the quarter compared with $456 million for the third quarter of 2020.

“This decline in operating income was driven by an increase in both care delivery expenses due to the delta variant COVID-19 surge and other operating expenses,” according to the earnings report.

Kaiser’s net income was also down compared to the $2 billion in the third quarter of 2020.

“During the quarter, we also intensified our leadership in ensuring equitable vaccine initiatives nationwide and implemented an employee vaccination mandate as part of our effort to protect our workforce, members and communities and to help bring the pandemic to an end,” Kaiser Chairman and CEO Greg Adams said in a statement.

Kaiser’s health plan membership also totaled 12.5 million as of Sept. 30, driven by a spike in Medicaid membership. The membership was roughly the same as that reported last quarter.

The earnings release comes as nearly 32,000 Kaiser workers are expected to strike Nov. 15 as unions strive for new pay increases from the system.


Source Link