InnovAge Holding Corp. reported its financial results for the third quarter of fiscal year 2025, ending March 31, 2025, revealing a total revenue of $218.1 million, a 13% increase from $193.1 million in the same period last year. The growth was primarily driven by a 13% rise in capitation revenue, which reached $217.8 million, up from $192.8 million. This increase was attributed to a combination of a 2.1% rise in capitation rates and a 10.7% increase in member months, reflecting the company's expansion efforts, particularly in California and Colorado.
Despite the revenue growth, InnovAge reported an operating loss of $10.2 million for the quarter, compared to a loss of $5.8 million in the prior year. The company's total expenses rose to $228.3 million, up from $198.9 million, largely due to increased external provider costs and corporate expenses. Notably, corporate, general, and administrative expenses surged by 40.1% to $38.6 million, driven by a $10.7 million accrual related to a potential settlement of a stockholder lawsuit, alongside increased employee compensation costs.
Operationally, InnovAge served approximately 7,530 PACE participants across 20 centers, marking a significant increase from 6,820 participants a year earlier. The company has also made strategic moves, including the acquisition of two California-based PACE programs for $23.9 million in December 2023 and pharmacy assets from Tabula Rasa Healthcare for $4.8 million in January 2025. These acquisitions are expected to enhance InnovAge's service offerings and operational efficiency.
Looking ahead, InnovAge anticipates continued challenges related to rising costs of care, particularly due to labor market pressures and inflation. The company is focused on mitigating these impacts through clinical and operational value initiatives. Additionally, InnovAge is actively working to address enrollment delays and gaps in eligibility processing, particularly in California, which could affect future revenue streams. The company remains committed to expanding its footprint and enhancing participant satisfaction while navigating the complexities of the healthcare landscape.
About InnovAge Holding Corp.
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