KAISER FOUNDATION: Posts Third Quarter Earnings After Years of Losses
After losing money for three years in a row -- and $500 million in two years -- Kaiser Foundation Health Plan and Hospitals has announced it expects to earn $180 million in net income this quarter, the Los Angeles Times reports. It lost $29 million in last year's third quarter. The Oakland-based company is crediting the financial turnaround to a plan implemented early last year, in which it divested itself of "money-losing operations" on the East Coast and delayed capital improvements. In California, the company opted to focus on HMO operations and "extricated itself from expensive contracts with outside hospitals." The HMO still "faces large expenditures" as it needs to upgrade hospitals and clinics, install computer systems in its facilities and become compliant with state seismic requirements. Kaiser spokeperson Beverly Hayon, said, "We feel good, but the race isn't won yet" (Bernstein, Los Angeles Times, 10/31).