Banner Health saw revenues and operating income grow in 2016, as the Phoenix-based system experienced an increase in patient volume.
Banner reported revenues of $7.6 billion in 2016, up 9.5 percent from revenues of $7 billion in the year prior, according to recently released bondholder documents. Banner said the revenue boost was attributable, in part, to the system renegotiating its support agreement with Sun Health, a senior living services provider that operates as subsidiary of Banner. Under the agreement, Sun Health agreed to pay Banner $60 million as a grant buy-down to be used in support of its programs, services and facilities in Maricopa County.
Banner also benefitted from higher net patient service revenue in 2016. The system said acute and observation cases increased 2.3 percent year over year, while emergency room visits and surgical volumes grew 3.5 percent and 4.9 percent, respectively.
After factoring in expenses, Banner ended 2016 with operating income of $157 million, up 22 percent from operating income of $128.4 million in 2015.
Banner's $4.2 billion investment portfolio generated a return of 4.4 percent in 2016, significantly above the 0.2 percent earned in the year prior. That strong nonoperating performance resulted in Banner's net income increasing from $83.7 million in 2015 to $268.8 million last year.
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