Kaiser Permanente Press Release 9/13/2005
Kaiser Foundation Health Plan, Inc., and Kaiser Foundation Hospitals Continue Positive Performance
Oakland, Calif. - Kaiser Foundation Health Plan Inc., Kaiser Foundation Hospitals and their subsidiaries (KFHP/H) are showing continued positive financial performance and membership growth through the third quarter of 2005.
Operating margin for the third quarter was 2.5 percent, leaving the overall operating margin for the first nine months of the year at 4.4 percent. At the same time, membership continues to grow, up 151,000 members for the year, to nearly 8.4 million.
"We are on course with our operating performance," said KFHP/H Chairman and CEO George C. Halvorson. "Wise use of our membership dollars allows us to fund our new hospitals, seismic retrofitting, facility improvements and KP HealthConnect, our new electronic physician-support tool."
Kaiser Permanente also uses its operating revenue to fund wide-ranging community benefit programs aimed at improving the health of the communities it serves, through research, community-based health partnerships, direct health coverage for low-income families, and collaborations with community clinics, health departments and public hospitals.
For the third quarter of 2005 (July through September), Kaiser Permanente's 2.5 percent operating margin was achieved on operating revenues of $7.8 billion. Net income was $305 million and operating income totaled $197 million.
That compared to a 6.5 percent operating margin in the third quarter of 2004, achieved on operating revenues of $7 billion. Net income for that quarter was $470 million and operating income totaled $461 million.
"Our 2005 third-quarter results are on plan and reflect our continuing investments in improving access to and quality of health care provided to our members," said Kathy Lancaster, KFHP/H senior vice president and chief financial officer. "Historically, results in the first half of the year are strongest, in part because a significant portion of rate increases go into effect in January, while cost increases occur throughout the year."
For the nine months ending September 30, 2005, the operating margin of 4.4 percent was achieved on operating revenues of $23.3 billion. Net income was $1.2 billion and operating income totaled $1 billion. For the first nine months of 2004, operating revenues totaled $20.9 billion. Net income was $1.3 billion and operating income totaled $1.2 billion.
Kaiser Permanente's capital investment for the first nine months totaled $1.6 billion, compared to $1.4 billion for the same period last year.
"Sufficient margins to meet our capital needs are important as construction costs continue to increase," Lancaster said.
Kaiser Permanente has 26 new or expanded hospitals either planned or under construction, including 13 of which are seismic-replacement hospitals required by the state of California. Seven are new hospitals, and six are expansions of existing hospitals to accommodate growth. More than half of the construction projects are expected to be under way by the end of 2006. The total capital project cost for Kaiser Permanente is expected to be in excess of $20 billion through 2012 for hospitals, medical office buildings, other facilities and technology improvements.
Implementation of KP HealthConnect, Kaiser Permanente's state-of-the-art electronic medical record system, is under way, and will be fully deployed nationwide over the next several years. This initiative involves the development and deployment of an integrated nationwide information system that combines patient records with best clinical practices, appointments, registration, and business systems. Through this advanced technology, Kaiser Permanente will eliminate inefficiencies and reduce the error rate inherent in paper-based systems.
"KP HealthConnect is key to making our members true partners with their physician and the rest of their care team in monitoring, maintaining and improving their health," Halvorson said. "Every major policy leader in health care is promoting the benefits of electronic medical records in improving the quality of care, and Kaiser Permanente is in the forefront of making that a reality."
Kaiser Permanente's success in meeting the needs of its members is the result of "its dedicated physicians, nurses, caregivers, technical, administrative and clerical staffs," Halvorson said. "Our labor management partnership is also one of the major factors that set us apart in addressing the health needs of our members and communities."
Kaiser Permanente is America's leading integrated health plan. Founded in 1945, it is a nonprofit; group practice prepayment program with headquarters in Oakland, Calif. Kaiser Permanente serves the health care needs of more than 8.3 million members in 9 states and the District of Columbia. Today it encompasses the nonprofit Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals and their subsidiaries, and the for-profit Permanente Medical Groups. Nationwide, Kaiser Permanente includes approximately 145,000 technical, administrative and clerical employees and caregivers, and more than 12,000 physicians representing all specialties.
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.
Oakland, Calif. - Kaiser Foundation Health Plan Inc., Kaiser Foundation Hospitals and their subsidiaries (KFHP/H) are showing continued positive financial performance and membership growth through the third quarter of 2005.
Operating margin for the third quarter was 2.5 percent, leaving the overall operating margin for the first nine months of the year at 4.4 percent. At the same time, membership continues to grow, up 151,000 members for the year, to nearly 8.4 million.
"We are on course with our operating performance," said KFHP/H Chairman and CEO George C. Halvorson. "Wise use of our membership dollars allows us to fund our new hospitals, seismic retrofitting, facility improvements and KP HealthConnect, our new electronic physician-support tool."
Kaiser Permanente also uses its operating revenue to fund wide-ranging community benefit programs aimed at improving the health of the communities it serves, through research, community-based health partnerships, direct health coverage for low-income families, and collaborations with community clinics, health departments and public hospitals.
For the third quarter of 2005 (July through September), Kaiser Permanente's 2.5 percent operating margin was achieved on operating revenues of $7.8 billion. Net income was $305 million and operating income totaled $197 million.
That compared to a 6.5 percent operating margin in the third quarter of 2004, achieved on operating revenues of $7 billion. Net income for that quarter was $470 million and operating income totaled $461 million.
"Our 2005 third-quarter results are on plan and reflect our continuing investments in improving access to and quality of health care provided to our members," said Kathy Lancaster, KFHP/H senior vice president and chief financial officer. "Historically, results in the first half of the year are strongest, in part because a significant portion of rate increases go into effect in January, while cost increases occur throughout the year."
For the nine months ending September 30, 2005, the operating margin of 4.4 percent was achieved on operating revenues of $23.3 billion. Net income was $1.2 billion and operating income totaled $1 billion. For the first nine months of 2004, operating revenues totaled $20.9 billion. Net income was $1.3 billion and operating income totaled $1.2 billion.
Kaiser Permanente's capital investment for the first nine months totaled $1.6 billion, compared to $1.4 billion for the same period last year.
"Sufficient margins to meet our capital needs are important as construction costs continue to increase," Lancaster said.
Kaiser Permanente has 26 new or expanded hospitals either planned or under construction, including 13 of which are seismic-replacement hospitals required by the state of California. Seven are new hospitals, and six are expansions of existing hospitals to accommodate growth. More than half of the construction projects are expected to be under way by the end of 2006. The total capital project cost for Kaiser Permanente is expected to be in excess of $20 billion through 2012 for hospitals, medical office buildings, other facilities and technology improvements.
Implementation of KP HealthConnect, Kaiser Permanente's state-of-the-art electronic medical record system, is under way, and will be fully deployed nationwide over the next several years. This initiative involves the development and deployment of an integrated nationwide information system that combines patient records with best clinical practices, appointments, registration, and business systems. Through this advanced technology, Kaiser Permanente will eliminate inefficiencies and reduce the error rate inherent in paper-based systems.
"KP HealthConnect is key to making our members true partners with their physician and the rest of their care team in monitoring, maintaining and improving their health," Halvorson said. "Every major policy leader in health care is promoting the benefits of electronic medical records in improving the quality of care, and Kaiser Permanente is in the forefront of making that a reality."
Kaiser Permanente's success in meeting the needs of its members is the result of "its dedicated physicians, nurses, caregivers, technical, administrative and clerical staffs," Halvorson said. "Our labor management partnership is also one of the major factors that set us apart in addressing the health needs of our members and communities."
Kaiser Permanente is America's leading integrated health plan. Founded in 1945, it is a nonprofit; group practice prepayment program with headquarters in Oakland, Calif. Kaiser Permanente serves the health care needs of more than 8.3 million members in 9 states and the District of Columbia. Today it encompasses the nonprofit Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals and their subsidiaries, and the for-profit Permanente Medical Groups. Nationwide, Kaiser Permanente includes approximately 145,000 technical, administrative and clerical employees and caregivers, and more than 12,000 physicians representing all specialties.
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.
posted by Kirby P at 4:08 PM
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