Officials at Oakland, Calif.-based Kaiser Permanente reported that the healthcare system's net income for 2009 was $2.1 billion, representing a significant jump over 2008's net loss of $794 million.
Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals and their subsidiaries (KFHP/H) reported combined total operating revenue of $10.6 billion for the quarter ended Dec. 31, 2009, a six percent increase compared to the same period in 2008. Reported operating income in the fourth quarter was $214 million, more than double what it was in 2008.
Kaiser's net non-operating income in the fourth quarter was $276 million compared to a net non-operating loss of $1.1 billion in 2008. As a result, net income for the fourth quarter was $490 million, versus a net loss of $996 million in the same period of 2008.
"We are pleased that our operating income remained stable despite the challenges of 2009," said Kathy Lancaster, Kaiser's executive vice president and chief financial officer. "We are also pleased that our non-operating income benefited from the partial recovery of the financial markets, and returned to a level that more appropriately supports our investments in our care delivery infrastructure. Given the volatility in the financial markets and ongoing governmental actions related to Medicare Advantage payment rates, we are continuing to take prudent measures to manage our operations and investments in a responsible way."
Kaiser officials acknowledged that while 2009 net income improved based on the partial financial market recovery, the overall performance of the past two years still poses ongoing challenges, because KFHP/H uses net income to make investments in care delivery facilities and technology.
KFHP/H reported that capital spending in the fourth quarter of 2009 was approximately $900 million, compared to nearly $1.1 billion in the same quarter in 2008. And capital spending for 2009 was approximately $2.6 billion, compared to $2.9 billion in 2008. Officials said during the past year, KFHP/H opened three hospitals, including two seismic hospital replacements, one new hospital tower and 17 medical office buildings.
In 2009, KFHP/H provided approximately $1.7 billion, four percent of its operating revenue, in annual support to community benefit programs and services.
"We're encouraged to see that our positive performance enables us to continue to invest in our communities, and to enhance the quality of care and service we provide our members," said George Halvorson, chairman and chief executive officer. "In 2009, Kaiser Permanente expanded its community benefit programs to place an even greater emphasis on helping people in need get access to health care during these difficult economic times."
Kaiser officials said total membership declined by approximately 64,000 members over the past year. As of Dec. 31, 2009, membership totaled 8.58 million.