Kaiser Permanente Reports 90% Increase in 2002 First-Quarter Net Income
Oakland-based Kaiser Permanente, the nation's largest not-for-profit HMO, yesterday reported a 90% increase in net income in the first quarter of 2002 as a result of "cost-cutting and higher premiums," the San Francisco Chronicle reports. Kaiser posted $297 million in first-quarter net income on $5.5 billion in operating revenue, an increase from $156 million in net income on $4.9 billion in operating revenue a year earlier. Kaiser also increased membership by 126,000, to 8.3 million, in the first quarter. In addition, Kaiser reported that first-quarter operating income increased to $288 million from $185 million a year earlier. Dale Crandall, president of Kaiser Foundation Health Plan and Hospitals, attributed the large increase in first-quarter net income in part to a "relatively weak" first quarter last year. He said that the "financial turnaround efforts" that Kaiser launched in 1999 after three years of reported losses only began to take effect in the third and fourth quarters of 2001. Crandall said, "I'm pleased with the way the organization has pulled together over the last four years to get us where we are today" (Colliver, San Francisco Chronicle, 5/1).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.