(This story has been updated with a correction.)
Kaiser Permanente, a hospital system that also operates its own health plan, has slowed its capital spending as it aims to get its costs under control. However, the first quarter of this year proved more challenging on that front and its operating margin dipped.
In a short earnings release, the Oakland-based system reported that its capital spending dropped to $740 million in the quarter, compared with $827 million during the same period last year. But the quarter still saw it open and renovate facilities in Colorado, as well as Northern and Southern California, including the new Kaiser Permanente South Bay Medical Center in Harbor City. In all, Kaiser says it operates 35 hospitals in California, 2 in Oregon and 1 in Hawaii.
Kaiser also continued to add new members to its health plan, which now counts 10 million beneficiaries. The first quarter brought in 464,000 members, including about 70,000 who enrolled in Medicaid.
Revenue at the system grew to $15 billion, a 7.9% increase over the $13.9 billion from the first quarter of 2014. Operating income, however, fell to $741 million, for an operating margin of 4.9%, compared with the prior-year period's $820 million, for an operating margin of 5.9%.
"Our financial performance allows us to advance our mission to provide high-quality, affordable health care and to improve the lives of our members and the communities we serve," Kaiser's Chief Financial Officer Kathy Lancaster, said in the release. "We remain committed to managing our cost trends while maintaining our focus on high-quality care and service."
(This story has been updated to correct the number of hospitals that Kaiser operates.)