honoluluadvertiser.com

Sponsored by:

Comment, blog & share photos

Log in | Become a member
The Honolulu Advertiser
Posted on: Saturday, May 16, 2009

Kaiser posts $300K loss in first quarter


Advertiser Staff

Kaiser Foundation Health Plan's Hawai'i region said it swung to a first quarter loss from a profit a year earlier with rising costs, the state's economic downturn and lower investment returns playing a role.

Hawai'i's largest health maintenance organization reported a net loss of $300,000 for the three months ended March 31.

That compared with a $3 million profit it reported a year earlier.

"During the first quarter, our membership and revenues declined in the tourism-related and construction industries, a direct result of the state's rising unemployment rates," said Bill Corba, Kaiser Foundation Hawaii chief marketing officer. Kaiser had 222,000 members during the quarter, or 1,000 less than a year earlier.

"We are focusing efforts on keeping rates affordable and providing coverage options for members who are losing their benefits due to a change in their employment status."

The HMO, which provides care through its 410 physicians and 4,400 nurses and staff, said revenue rose by 3.6 percent but that expenses rose faster.

That resulted in an operating loss of $1.6 million.

Last year, Kaiser had $2.4 million of investment income, which contributed to its quarterly profit. Investment income this year fell to $1.3 million, or not enough to offset the operating loss.

Earlier this year, Kaiser instituted a 4.9 percent average rate increase for members.

• • •