Oakland, Calif.-based Kaiser Permanente recorded an operating income of $1.7 billion (4.6% operating margin) in the second quarter of 2026, up from $1 billion (3.2% margin) during the same period last year, according to its Aug. 14 financial report.
Seven things to know:
1. Kaiser Permanente reported total operating revenue of $35.6 billion during the three months ended June 30, up from $32.1 billion during the same period last year. Members’ dues totaled $21.3 billion, up from $20 billion. Medicare Advantage revenue totaled $8.8 billion, up from $7.8 billion. Patient service and other revenue totaled $5.5 billion, up from $4.3 billion.
2. Total operating expenses were $34 billion in the second quarter of 2026, up from $31.1 billion during the same period last year. Medical service expenses totaled $15.4 billion, up from $14.1 billion. Hospital service expenses totaled $9.9 billion, up from $8.7 billion. Outpatient pharmacy and optical service expenses totaled $4 billion, up from $3.8 billion.
3. Kaiser said operating income is typically stronger in the first half of the year due to health plan enrollment cycles. Later in the year, operating income moderates significantly as care utilization, labor costs and other expenses increase while revenue stays relatively flat.
4. Capital spending was $1.3 billion in the second quarter of 2026, up from $1.1 billion during the same period last year. As of June 30, Kaiser had more than 60 projects in active design and construction, including seven major hospital construction projects. Risant Health’s affiliates — Danville, Pa.-based Geisinger and Greensboro, N.C.-based Cone Health — also had construction projects underway in the second quarter. Washington, D.C.-based Risant is a nonprofit created by Kaiser to expand value-based care by partnering with community health systems.
5. Risant announced July 29 that its founding CEO, Jaewon Ryu, MD, is stepping down to focus on his family. Dale Maxwell, the former president and CEO of Albuquerque, N.M.-based Presbyterian Healthcare Services, will serve as interim CEO.
6. Health plan membership across Kaiser Permanente and Risant affiliates was nearly 13.4 million as of June 30, up from more than 13.1 million as of June 30, 2025.
7. Kaiser reported a net income of $5.3 billion in the second quarter of 2026, up from $3.3 billion during the same period last year.
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