HMSA profit helped by $10.4 million tax settlement
Hawaii Medical Service Association's April-to-June profit more than doubled from the same period a year earlier, helped by a $10.4 million gain from a tax settlement. The settlement offset a 6.7 percent rise in healthcare services costs and a decline in investment income.
Net income: $12.6 million vs. $4.85 million
Premium Revenue: $450 million vs. $425.2 million
Healthcare Service Cost: $416.9 million vs. $390.6 million.
Administrative Expense: $37.6 million vs. $33.8 million
Operating Loss: $4.53 million vs. gain of $830,900
Investment income: $6.27 million vs. $7.05 million
WHAT THEY ARE SAYING
"We saw healthcare costs rise at a faster rate than dues income. ... Benefit costs for medical, hospital and prescription drugs were also above last year's second-quarter level."Cliff Cisco
Senior vice president
HMSA is monitoring how the new Medicare Part D drug plan is increasing its revenue and costs.
The tax settlement also will have an affect in upcoming quarters, though it won't be as large.
Revenue is projected to rise because of a 3.8 percent rate increase that went into effect July 1, covering 11,000 small businesses with about 142,000 employees.