Kaiser Permanente has reported that its Kaiser Foundation Health Plan, Kaiser Foundation Hospitals and subsidiaries saw dramatic increases in its net income, operating income and investment income over the last three and nine months, with nine month profits more than doubling. What's particularly noteworthy is that as of a year ago, the company stood to lose billions.
A few choice numbers: Kaiser's operating income more than doubled, from $868 million in the first three quarters of 2006 to $1.8 billion this year, and net income for the first nine months shot up from $1.1 billion to $2.5 billion. Net income climbed a staggering 56.8 percent in the third quarter, from $417 million last year to $654 million for this year. All of this can't be attributed to a growth in membership among the health plans, which was more or less level at 8.7 million beneficiaries. Instead, Kaiser attributes the big margins to health care cost cutting and administrative efficiencies.
Given that Kaiser's a non-profit organization, these results are sure to raise some eyebrows. I don't know about you, but if I were a Kaiser exec, I'd see these results as a bit of a liability in a climate where non-profits are facing losses of tax exemptions. Kaiser, wouldn't it have made sense to release a report documenting your good works given these big numbers? Or do you really prefer to have a big bullseye painted on your side?
To learn more about Kaiser's numbers:
- read this San Francisco Business Journal piece
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