Banner Health's revenue and net income were up year over year in the first half of 2019, according to unaudited financial documents.
The Phoenix-based health system reported revenues of $4.7 billion in the first half of this year, up from $4.2 billion in the same period of 2018. Banner said the 11.6 percent boost was driven by growth in premium revenues from its insurance division coupled with increases in patient volumes and commercial reimbursement rates. Insurance premium revenue now represents 20 percent of Banner's total revenue.
Operating expenses climbed 12.3 percent year over year to $4.6 billion in the first half of 2019. Banner said the increase was attributable to several factors, including opening new patient towers at its campuses in Phoenix and Tucson, Ariz., and adding more than 100 new physicians.
Banner ended the first half of 2019 with operating income of $111.8 million, down from $127.3 million in the same period of 2018.
After factoring in nonoperating items, Banner reported net income of $430.9 million in the first six months of this year. That's more than double the net income of $198.2 million the health system recorded in the same period of 2018. The year-over-year increase was fueled by investment income.
"Investment income of $411.8 million, a 9.8 percent return from our comprehensive investment program year to date, helped to bring the fair value of Banner's cash and investment portfolio over $5 billion," Banner said.
More articles on healthcare finance:
Vermont hospital likely to close without merger
CEO resigns amid Tennessee health system's financial troubles
10 hospitals seeking CFOs