Baylor Scott & White Health Posts Strong Financial Results in H1 2026

The Texas-based healthcare system reported a 10.7% operating margin and $998 million in operating income.

Published on Feb. 20, 2026

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Baylor Scott & White Health, a major healthcare system based in Dallas, Texas, reported strong financial results for the first half of fiscal year 2026. The system posted an operating income of $998 million, representing a 10.7% operating margin, up from $953 million (11.2% margin) during the same period last year. This growth was driven by an increase in total operating revenue to $9.3 billion, up from $8.5 billion a year earlier, as well as higher expenses.

Why it matters

Baylor Scott & White's solid financial performance highlights the system's ability to effectively manage costs and grow revenue, even in the face of rising expenses for salaries, supplies, and medical claims. This positions the system well to continue investing in patient care, facility upgrades, and other strategic initiatives that benefit the communities it serves.

The details

Baylor Scott & White's total operating revenue grew to $9.3 billion in the first half of fiscal 2026, up from $8.5 billion in the same period last year. This was driven by a $600 million increase in net patient revenue to $7.3 billion, as well as a $200 million rise in premium revenue to $1.5 billion due to growth in individual exchange and Medicare Advantage membership. However, total operating expenses also increased, rising from $7.5 billion to $8.4 billion, with the largest increases seen in salaries, wages and employee benefits (up $300 million to $3.8 billion) and medical claims expenses (up $127 million to $908 million).

  • Baylor Scott & White reported its financial results for the six-month period ended December 31, 2025.

The players

Baylor Scott & White Health

A large non-profit healthcare system based in Dallas, Texas that operates hospitals, clinics, and other healthcare facilities across the state.

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The takeaway

Baylor Scott & White's strong financial performance in the first half of fiscal 2026, with a 10.7% operating margin and $998 million in operating income, demonstrates the system's ability to effectively manage costs and grow revenue despite rising expenses. This positions the organization well to continue investing in patient care and other strategic initiatives to serve its communities.