Kaiser Permanente’s non-operating income dropped 71% in 2018

Kaiser Permanente saw a modest uptick in operating income in 2018, but a 71% drop in non-operating income, as the integrated health system weathers volatile investment markets.

The Oakland, Calif.-based system reported $1.9 billion in operating income last year, or 2.4% of operating revenue, compared with $1.7 billion in 2017, or 2.4% of operating revenue that year. Meanwhile, net non-operating income fell 71% to $617 million, compared with $2.1 billion in 2017.

Not-for-profit Kaiser, which consists of Kaiser Foundation Health Plan and Kaiser Foundation Hospitals, posted total operating revenue of $79.7 billion in 2018, up 9.6% from the prior year, when it reported $72.7 billion.

Kaiser’s net income dropped 34% year-over-year, from $3.8 billion in 2017 to $2.5 billion in 2018. Meier said the system’s operating margin held steady at 2.4% year-over-year.

Membership in Kaiser’s health plan was 12.2 million as of Dec. 31, 2018, up more than 400,000 members year-over-year, or 3.5%.