Atrium Health Wake Forest Baptist begins 2026 with 20% excess revenue gain

An uptick in patient services revenue, along with more investment income gains, lifted Atrium Health Wake Forest Baptist to a 19.8% jump in excess revenue to $344.61 million for its first quarter of fiscal 2026.

Excess revenue in a not-for-profit organization, such as Baptist, equates to profit in a for-profit business, while a deficit equates to a loss.

Baptist is the largest employer in northwest North Carolina, with more than 22,000 employees systemwide.

The quarterly financial filing combines reports for N.C. Baptist Hospital, Wake Forest University Health Sciences, Wake Forest Baptist Medical Center, and all their affiliates.

Core operating income was up 9.2% to $169.8 million.

Core revenue was up 16.9% to $6.84 billion, representing $5.51 billion of patient-service revenue and $1.33 billion in "other revenue."

The core revenue increases were due to "greater hospital and medical group patient volumes, additional Medicaid supplemental program funding and growth in retail pharmacy sales."

Operating expenses rose 17.1% to $6.67 billion, in large part from higher patient volumes and "other expense inflation."

The primary expense factors: personnel costs rose 13.8% to $3.78 billion; supplies and drugs were up 10.3% to $1.39 billion; and purchased and other services - typically travel nurse expenses - jumped 39.7% to $1.27 billion.

Investment income was at $281.1 million during the first quarter, compared with $215.9 million a year ago.

Not-for-profit hospitals, such as Baptist and its parent company, Atrium Health; Cone Health; and Novant Health Inc., depend on investment income to boost their bottom lines and help pay for capital projects.

Volatility in investment income in the stock market has been expected amid uncertainty over the Trump administration's tariffs.

Baptist spent $216 million in capital investments during the first quarter, compared with $290 million a year ago.

The report is included within the Advocate Health filing on the Municipal Securities Rulemaking Board's website (www.emma.msrb.org).

Such reports are aimed primarily at bondholders and ratings agencies and are typically submitted about 10 to 11 weeks after the quarter ends.

Parent company performance

Advocate Health - the nation's third-largest not-for-profit health care system - debuted in December 2022 representing the completed merger of Atrium Health of Charlotte and Advocate Aurora of Chicago and Milwaukee.

Advocate reported a 29.2% increase in excess revenue over expenses to $651.9 million that includes Baptist's financial performance.

Core operating income rose 15.5% to $380.1 million.

Core revenue rose 10.7% to $10.15 billion. Expenses climbed 10.6% to $8.84 billion. Investment income rose 30% to $276.3 million.

Atrium Health acquired Baptist in October 2020. Baptist remains under the Atrium umbrella from an organizational structure.

Atrium reported a 36.4% gain in excess revenue over expenses to $267.1 million.

Core operating income jumped 26.4% to $210.2 million.

Core revenue was up 11% to $3 billion. Expenses climbed 10% to $2.79 billion. Investment income was up 74.4% to $86.2 million.

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