Oakland, Calif.-based Kaiser Permanente posted a $608 million operating loss (-2.1% operating margin) in the third quarter of 2024, down from an operating income of $156 million (0.6% operating margin) in the same quarter last year, according to its Nov. 8 financial report.
Kaiser posted an operating revenue of $29 billion in the three months ended Sept. 30, up from $24.9 billion over the same period in 2023. The system reported operating expenses of $29.6 billion in the third quarter, up from $24.7 billion over the same period last year.
The system said that it continues to experience "increased medical expenses due to higher-than-expected utilization of services, patient acuity and pharmacy costs." Kaiser also said that its third-quarter performance also included the "impact of Medicaid and other true-ups of annual contracts that normally occur earlier in the year."
"Understanding that financial headwinds are part of the healthcare environment for the immediate future, the organization has reduced administrative costs and continued to take steps to help offset medical expenses," the system said in the report. "These steps include implementing controls on discretionary spending and streamlining business operations to accelerate performance improvements while delivering value to members."
Kaiser posted a net income of $845 million in the third quarter, up from $239 million over the same period last year.
For the nine months ended Sept. 30, Kaiser posted an operating income of $1.2 billion (1.4% margin) compared to $1.1 billion (1.5% margin) over the same period last year.