The subsidiary and its growing fleet of health systems had a noticeable impact on Kaiser's year-end financial report.
Less than a year since launching, Risant Health is proving to pay dividends for Kaiser Permanente.
The integrated health system reported its 2024 earnings, which showed the subsidiary and its additions are boosting the bottom line.
In its first earnings report to include consolidated financial results for the health system, health plan, and Risant, Kaiser brought in $115.8 billion in operating revenue across 2024, compared to $100.8 billion in the prior year.
Kaiser's net income for the period was $12.9 billion, with Risant's acquisitions accounting for $6.8 billion of that figure, resulting in a jump from the $4.1 billion reported in 2023.
Operating expenses also increased year-over-year to $115.2 billion, compared to $100.5 billion in the previous period, as Kaiser dealt with "significant financial pressures" such as patient volume and high prescription drug prices, the system stated.
"Our financial performance in 2024 showed a modest improvement in operating income and, like others, we saw gains in nonoperating income driven by investment returns in the financial markets," Kaiser Permanente executive vice president and CFO Kathy Lancaster said in a statement. "This financial performance, along with carefully managing our resources and becoming more effective in our operations, allowed us to maintain investments in our capital and technology programs to drive affordability and enhance the consumer experience."
Risant launched last April after closing its deal for Geisinger Health, giving it its first health system for its value-based network.
Risant then tabbed Cone Health in the summer as its second acquisition before finalizing that transaction in December.
Both Geisinger and Cone were profitable systems before being scooped up by Risant, with the former reporting $367 million in net income in 2023, while the latter recorded $197.6 million.
At least three to four additional systems are expected to be added within the next half-decade, based on the plans Risant has laid out, which includes reaching a total revenue of $30 to $35 billion.
Currently, Kaiser and Risant consist of 55 hospitals, 40 retail and employee clinics, 841 medical offices, and more than 13 million health plan members.
Jay Asser is the CEO editor for HealthLeaders.
KEY TAKEAWAYS
Kaiser Permanente's 2024 earnings revealed that Risant Health and its acquisitions contributed $6.8 billion to a net income of $12.9 billion.
Risant also helped Kaiser raise its operating income year-over-year to $115.8 billion, versus $100.8 billion in 2023.
Over the past year, Risant acquired Geisinger Health and Cone Health as it works towards its stated goal of having at least five systems in its value-based network.