Press Releases: National
November 7, 2006
Kaiser Foundation Health Plan and Hospitals Report Positive Third-Quarter Performance and Prepare for a Challenging 2007
OAKLAND, Calif. – Kaiser Foundation Health Plan Inc., Kaiser Foundation Hospitals and their subsidiaries (KFHP/H) reported nearly $8.7 billion in total operating revenue for the quarter ended September 30, 2006, approximately $855 million more than the $7.8 billion in total operating revenue reported in the same period last year. Net income for the third quarter of 2006 was enhanced by reductions of liabilities for self-insured risk and totaled $417 million, compared to $305 million in last year’s third quarter.
Membership grew by more than 30,000 members during the third quarter, with total membership greater than 8.6 million members at September 30, 2006. KFHP/H’s capital spending, which supports continued investment in facilities expansion, seismic retrofitting and care delivery programs, was $631 million in the third quarter of this year, compared to $651 million in the same period last year.
“We continue to make good progress in our efforts to enhance and broaden the care and service we provide by using our earnings to make crucial investments in our integrated health care system,” said KFHP/H Chairman and Chief Executive Officer George C. Halvorson. “Two of our important goals have been to continue expanding our portfolio of health care solutions and to bring more features of KP HealthConnectTM online in our regions. Through these key avenues, our members, customers and communities are gaining greater choice and flexibility in the way they manage their health.”
Combining patient records, clinical practices, appointments, registration and business systems, KP HealthConnect is an integrated medical records system that is helping to transform the way members partner with KFHP/H care providers. Once fully implemented, it is anticipated to be the largest, non-governmental, electronic medical records system in the United States.
KFHP/H also uses its revenues to support community benefit programs that provide direct health care coverage for low-income families and community-based health partnerships. In addition, KFHP/H supports research and collaboration with community health organizations, including health departments, clinics and public hospitals.
“Our performance in the third quarter was in line with our expectations, but we are working to strengthen our organization for what will be a challenging 2007,” said Senior Vice President and Chief Financial Officer Kathy Lancaster. “With the government’s changes to the Medicare Advantage program taking effect soon, our industry expects Medicare reimbursement to grow at a slower rate in the years ahead. To prepare for this change, we are continuing to reinforce the quality of our care and service by working harder to leverage the advantages of our integrated health care system.”
“As health care needs evolve, our industry is simultaneously undergoing significant and rapid change,” said Halvorson. “But in each of our important efforts, our physicians, nurses, caregivers, union partners and technical, administrative, and clerical teams remain committed to our long tradition of broadening access and increasing the value of the care and service we provide.”
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 regulations; health care legislation; 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.
