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Kaiser Foundation Health Plan and Hospitals report 2023 financial results

7Newswire

OAKLAND, Calif.Feb. 10, 2024 /7Newswire — Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and their respective subsidiaries (KFHP/H) reported 2023 annual financial results that reflect a commitment to deliver on its mission to provide high-quality, affordable care and services amid ongoing industrywide challenges of high medical costs and a competitive labor environment.

Primary expense drivers for the health care sector in 2023 included the high costs of goods and services; prescription drug prices; high volumes of deferred care; continued COVID-19, flu, and RSV (respiratory syncytial virus) services; and costs associated with the labor environment. Kaiser Permanente met these challenges by reducing administrative costs and pursuing efficiencies while expanding access to its high-quality care.

Operating income was $329 million for the year compared to an operating loss of $1.3 billion in 2022. Operating revenues for 2023 were $100.8 billion compared to $95.4 billion in 2022. Operating expenses were $100.5 billion compared to $96.7 billion in the prior year.

Separate from operating income, other income (net of other expense) was $3.8 billion in 2023, compared to a loss of $3.2 billion in 2022. Other income in 2023 consisted primarily of investment returns, which offset the losses experienced in 2022. As a result of swings in the financial market, net income was $4.1 billion for 2023 compared to a net loss of $4.5 billion for 2022.

“I want to thank the people of Kaiser Permanente for their hard work in 2023 to provide members and patients with a positive experience at all touch points while also embracing new ways to drive efficiencies, improve access, and advance health outcomes,” said chair and chief executive officer Greg A. Adams. “Together, we navigated another challenging year and are on a path to deliver on our mission and bring our distinct brand of value-based care to more people.”

Membership

Kaiser Permanente had more than 12.5 million members as of December 31, 2023, a decline of nearly 51,000 members over the prior year, due to the slowing pace of job growth and other economic factors.

Improving community health

In 2023, Kaiser Permanente supported a wide range of community health programs with an investment of $3.1 billion, compared to $2.8 billion the year prior. These programs focused on addressing the public health crisis of gun violence, helping more people access healthy food, and supporting nonprofits that help people better manage their finances. Notably, the Kaiser Permanente Medical Financial Assistance program provided nearly 412,000 low-income and uninsured patients more than $668 million in assistance to cover part or all of their medical expenses. In August 2023, Kaiser Permanente launched the Kaiser Permanente Community Support Hub, dedicated to helping people connect to resources to meet their daily needs such as food, housing, and utilities. Kaiser Permanente screened more than 2.6 million members for social needs in 2023 and connected nearly 350,000 members to vital programs.

Capital spending

Kaiser Permanente continued to execute its capital strategy in 2023. Capital spending totaled $3.8 billioncompared to $3.5 billion the prior year. In August 2023, Kaiser Permanente opened the San Marcos Medical Center, a 433,000-square-foot facility serving members and patients in San Diego County, California. As of December 31, 2023, Kaiser Permanente had 618 medical offices, 40 owned hospitals, and 43 retail and employee clinics.

Consumer-focused digital care and service

Kaiser Permanente invested in leading-edge technology that supports its physicians and care teams to improve the member experience and patient outcomes. For example:

  • To support convenient access to care, scheduled phone and video visits totaled more than 22 million in 2023.
  • To help improve medication adherence for better health outcomes, Kaiser Permanente expanded its digital portfolio to include opt-in prescription refill reminders through text messages and mobile notifications to help patients remember when to take their medications. Members filled nearly 50 million online prescription orders through kp.org or the mobile app in 2023.
  • To help manage ongoing conditions such as diabetes and hypertension, more than 86,000 members enrolled in remote care programs, which allow their care teams to access real-time health evaluations in between medical appointments.

“Kaiser Permanente remains committed to providing affordable care and coverage for our members as we continue to mitigate increased costs in this evolving health care environment,” said executive vice president and chief financial officer Kathy Lancaster. “By fulfilling our mission, eliminating inefficiencies, and investing in technology, facilities, and our communities, we are on a financially sustainable path.”

2023 and 2022 annual financial summary

($ in millions)

2023

2022

Operating revenues

$100,847

$95,408

Operating expenses

$100,518

$96,678

Operating income (loss)

$329

($1,270)

Operating margin

0.3 %

(1.3 %)

Other income (net other expense)

$3,793

($3,198)

Net income (loss)

$4,122

($4,468)

Capital spending

$3,821

$3,528

Note: Certain statements included in this document may constitute “forward-looking statements.” Such statements are generally identifiable by the terminology used, such as “plan,” “project,” “forecast,” “expect,” “estimate,” “budget,” or other similar words. The achievement of certain results or other expectations contained in such forward-looking statements involves known and unknown risks, uncertainties, and other factors, which may cause actual results, performance, or achievements described to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Accordingly, actual results will vary and the variations may be material. None of the KFHP/H organizations plan to issue any updates or revisions to those forward-looking statements if or when expectations change, or events, conditions, or circumstances on which such statements are based occur.

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 has a mission to provide high-quality, affordable health care services and to improve the health of our members and the communities we serve. We currently serve 12.5 million members in 8 states and the District of Columbia. Care for members and patients is focused on their total health and guided by their personal Permanente Medical Group 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 about.kp.org.

Contact:
Stephen Shivinsky
stephen.shivinsky@kp.org

SOURCE Kaiser Permanente