Kaiser Foundation Hospitals and Health Plan Report Fiscal Year 2014 and Fourth Quarter Financial Results

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Feb 13, 2015, 03:43 ET

OAKLAND, Calif., Feb. 13, 2015 /PRNewswire/ -- Kaiser Foundation Hospitals, Kaiser Foundation Health Plan, Inc. and their subsidiaries (KFH/HP) reported today that combined total operating revenue for 2014 was $56.4 billion, compared to $53.1 billion in 2013. Operating income from continuing operations in 2014 was $2.2 billion, equal to 3.9 percent of operating revenue, compared to $1.8 billion, equal to 3.4 percent of operating revenue, in 2013. Net income from discontinued operations was $3 million in 2014, compared to a loss of $119 million in 2013. Non-operating income from continuing operations was $895 million in 2014, vs. $1.0 billion in 2013. As a result, net income for 2014 was $3.1 billion, compared to $2.7 billion in 2013.

Total membership increased by more than 510,000 members over the past year. As of Dec. 31, 2014, membership was approximately 9.6 million.

"Today we provide health coverage and care to just under 10 million Americans, thanks to our tremendous membership growth in 2014," said Chairman and CEO Bernard J. Tyson. "This affirms that our focus on quality, service and affordability is resonating with America. While we have more work to do, we will continue demonstrating to our members and to the country that it is possible to provide high-quality and affordable care to all segments of society."

KFH/HP's capital spending reflects continued investments in technology and facilities to support member care now and in the future, including building additional capacity for continued membership growth. Capital spending in 2014 was $2.8 billion, compared to $3.3 billion in 2013. With the completion of facilities in Oakland, Redwood City and San Leandro in 2014, all Kaiser Permanente hospitals in California are in compliance with the state's 2015 seismic safety standards.

"Our financial performance has positioned us to offer lower premium increases for 2015 while also ensuring that we can make the necessary ongoing investments in our care delivery system to continue providing our members, patients, customers and communities with high-quality and affordable 21^st-century health care," said Chief Financial Officer and Executive Vice President Kathy Lancaster.

For the quarter ending Dec. 31, 2014, combined total operating revenue was $14.2 billion, compared to $13.5 billion in the same period in 2013. Operating loss was $66 million in the fourth quarter of 2014, compared to operating income of $117 million in the same quarter of the prior year. Net income from discontinued operations was $3 million in the fourth quarter of 2014, compared to $12 million in the same quarter of 2013. Net non-operating loss was $5 million in the fourth quarter of 2014, compared to net non-operating income of $400 million in the same quarter of 2013. As a result, net loss for the fourth quarter was $68 million, versus net income of $529 million for the same period in 2013. Capital spending in the fourth quarter of 2014 was $725 million, compared to $1.0 billion in capital spending in the fourth quarter of 2013.

In 2014, KFH/HP provided approximately $2.2 billion, or 3.9 percent of operating revenue, to support community benefit programs and services. KFH/HP community benefit investments provide care for low-income individuals, support community-based health partnerships, and help KFH/HP conduct and share important medical research.

As nonprofit organizations, KFH/HP use operating income to benefit members, customers and communities through lower rate increases, capital investments in facilities and infrastructure to enhance care and service, and community benefit programs to improve the health of the communities they serve.

Except for historical information contained herein, the matters discussed in this media release are forward-looking statements that involve risks and uncertainties. Actual results may differ materially based on a number of factors including, but not limited to: the impact of competitive products and pricing, government regulations, changing membership requirements, and the change in business and economic conditions. Forward-looking statements are based on information as of the date of this media release, and we assume no obligation to update or revise any of these forward-looking statements, whether as a result of new information, future events or otherwise.

About Kaiser Permanente

Kaiser Permanente is committed to helping shape the future of health care. We are recognized as one of America's leading health care providers and nonprofit health plans. Founded in 1945, Kaiser Permanente's mission is to provide high-quality, affordable health care services and to improve the health of our members and the communities we serve. As of December 31, 2014, we serve approximately 9.6 million members in eight states and the District of Columbia. Care for members and patients is focused on their total health and guided by their personal physicians, specialists and team of caregivers. Our expert and caring medical teams are empowered and supported by industry-leading technology advances and tools for health promotion, disease prevention, state-of-the art care delivery and world-class chronic disease management. Kaiser Permanente is dedicated to care innovations, clinical research, health education and the support of community health. For more information, go to: kp.org/share.

For more information, contact:
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SOURCE Kaiser Permanente