Press Releases: National
August 1, 2003
Kaiser Permanente Maintains Positive Financial Performance in 2nd Quarter
Not-for-Profit Gears Up for New Challenges
OAKLAND, Calif. – Kaiser Foundation Health Plan Inc., Kaiser Foundation Hospitals and their subsidiaries (KFHP/H), reported net income of $306 million and operating income of $298 million on operating revenues of $6.3 billion for the second quarter of 2003. By comparison, in the second quarter of 2002 KFHP/H posted net income of $161 million and operating income of $168 million on operating revenues of $5.5 billion.
Through June 30, 2003, KFHP/H reported net income of $607 million and operating income of $606 million on operating revenues of $12.5 billion. This compares to net income of $458 million and operating income of $456 million on operating revenues of $11 billion during the same period in 2002.
As a not-for-profit, KFHP/H re-invests most of its net income in improvements such as the automated medical record, and new hospitals and clinics to meet the needs of its members. In addition, investments are made in community benefit programs that help the communities in which Kaiser Permanente is located.
Membership as of June 30, 2003 remained at 8.3 million reflecting the impact of the weakened economy.
"I am gratified that we have been able to deliver positive 2nd quarter results despite flat membership figures," stated Robert Briggs, senior vice president and CFO, KFHP/H. "In addition, our results for the first half of the year contain some positive items that are not expected to re-occur in the second half of 2003 at the same magnitude. These items approximate .4% of operating revenue. Our overall positive performance allows us to continue our investment in the new technologies which, we believe, will ultimately keep health care affordable for our members - a hallmark of Kaiser Permanente."
"This is a time of systems re-engineering and re-design for Kaiser Permanente," stated George Halvorson, chairman and CEO of KFH/KFHP. "We are creating new flexibility in our benefits. The automated medical record remains a key component of the agenda we have set for ourselves in order to grow and succeed in the future."
Work is underway on Kaiser Permanente's implementation of an automated medical records system and related products, one of the largest of its kind. Currently, the work is focused on configuring the Epic products to meet the specific needs of Kaiser Permanente. The last quarter of 2003 will be devoted to product testing and systems integration, with deployment in regions expected to begin in early 2004.
Except for historical information contained herein, the matters discussed in this media release are forward-looking statements that involve risks and uncertainties. Actual results may vary significantly based on a number of factors including, but not limited to: the impact of competitive products and pricing; government regulation; health care legislation; litigation; changing membership requirements, and the change in economic conditions of the various markets the organization serves.
About Kaiser Permanente
Kaiser Permanente is committed to helping shape the future of health care. We are recognized as one of America’s leading health care providers and not-for-profit health plans. Founded in 1945, our mission is to provide high-quality, affordable health care services and to improve the health of our members and the communities we serve. We currently serve 8.6 million members in nine states and the District of Columbia. Care for members and patients is focused on their total health and guided by their personal physicians, specialists and team of caregivers. Our expert and caring medical teams are empowered and supported by industry-leading technology advances and tools for health promotion, disease prevention, state-of-the art care delivery and world-class chronic disease management. Kaiser Permanente is dedicated to care innovations, clinical research, health education and the support of community health. For more information, go to: www.kp.org/newscenter.
