Banner’s net patient service revenue barely increased year-over-year to $4.41 billion, but medical insurance premiums from Banner Health Plans soared 63 percent to $439.7 million.
Despite the increase in revenue, Banner’s operating income took a slight hit. Operating profit dropped more than 12 percent to $254.1 million on rising expenses, giving the 24-hospital system an operating margin of 5 percent last year. In 2012, Banner’s operating margin was almost 6 percent. However, Banner’s overall profit soared 40 percent to $815.5 million due to massive gains from investments and interest rate swaps.
This past February, Banner acquired the 177-bed Casa Grande (Ariz.) Regional Medical Center. The hospital had to file for Chapter 11 bankruptcy to complete the sale, and Banner also agreed to provide interim funding to the financially struggling CGRMC until the deal closes.
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