Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals (KFHP/H), and their subsidiaries reported today a combined total operating revenue of $10.5 billion for the quarter ended September 30, 2009, compared to $10.2 billion in the third quarter of last year. Operating income in the third quarter was $336 million, compared to $307 million in the third quarter of last year. Net non-operating income was $233 million in the third quarter, compared to a net non-operating loss of $706 million in the third quarter of last year. As a result, third quarter net income was $569 million, versus a $399 million net loss in the third quarter of last year. These represent the combined operating results for Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and their subsidiaries.
Year-to-date total operating revenue was $31.6 billion, compared to $30.3 billion in the same period last year. Year-to-date operating income was $1.4 billion, which is comparable to the same period last year. Net non-operating income was $248 million in the first nine months of the year, compared to a net non-operating loss of $1.1 billion in the same period last year. As a result, year-to-date net income was approximately $1.6 billion, versus net income of $202 million in the same period last year.
Total membership declined by 63,000 members in the first nine months of the year and stands at 8.58 million. Capital spending totaled approximately $1.7 billion in the year-to-date period, versus $1.8 billion of capital spending reported in the same period last year.
"While we are seeing some positive activity in the financial markets, uncertainty in the economy and health care industry continues," said Kathy Lancaster, executive vice president and chief financial officer. "Though we are pleased with our performance, we continue to focus on making our high-quality care and service as affordable as possible, which is especially important to our customers and members in this uncertain environment." Lancaster continued, "Looking forward, we remain cautious about economic recovery given the continued high rates of unemployment."
"As a non-profit, we reinvest our income in our care delivery system in order to deliver greater value to our members and the communities we serve," said George Halvorson, chairman and chief executive officer. "Since the third quarter of 2007, we have opened four new hospitals and 27 new medical office buildings. We have also expanded, renovated or completed seismic retrofits of another 9 hospitals.
"Through our financial performance we are also able to support the funding of programs like the Care Management Institute (CMI) that focuses on developing important evidence-based care programs for our members," Halvorson continued. "This month, CMI announced the results of a three-year study in which 1,271 heart attacks and strokes were prevented through the use of a three-drug regimen. Overall, this reduced the occurrence of heart attacks and strokes by 60 percent for the covered population."
KFHP/H continued to broaden the availability of Kaiser Permanente HealthConnect®, the world's largest civilian electronic health record, during the third quarter of 2009. A key part of KFHP/H's information technology platform and tools, KP HealthConnect provides clinical information, coordination, and support for all members, physicians, and other care providers in all care settings. Implementation of KP HealthConnect for all outpatient care was completed last year, and as of the end of the third quarter of this year had been implemented in 31 of 36 hospitals and in all of our ambulatory environments. All Kaiser Permanente members can access their personal health information online securely through My Health Manager on kp.org. Currently, there are 3.3 million users of My Health Manager, and members send an average of 650,000 electronic messages each month to their Kaiser Permanente physicians, nurses, and other clinicians using the system. During the third quarter of 2009, members refilled more than 1.8 million prescriptions through kp.org, a 22.6 percent increase from the third quarter of last year. The ease of prescription refills at Kaiser Permanente was recently recognized by J.D. Power and Associates which gave KP the highest ranking in customer satisfaction among mail-order pharmacies.
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