Please choose your delivery country and your customer group
The Kaiser Medical Care Program is a prototype for other Health Maintenance Organizations (HMO's). Since the 1973 HMO Act, these organizations have become important alternatives to obtaining primary health care from use of insurance coverage. The authors feel that an overview of the Kaiser Medical Care Program's financial structure and operating experience can be valuable to managers and financial planners in newer HMO's. The Kaiser system is a loosely organized group of 18 separate units. There are three main elements, the Kaiser Foundation Health Plan Inc. which performs administrative and contractual functions, the Kaiser Foundation Hospital, and the Permanente Medical Groups which provide or obtain professional services as contracted to the members. There are also six corporations performing support tasks. All these different units operate financially as a single unit. The article assesses Kaiser's financial performance by looking at short-term liquidity, profit availability, long-term debt position, and fund flows. Revenues are derived from members' dues, supplemental charges to members, Medicare, nonplant and industrial revenues and other revenues, e.g. grants. Through experience Kaiser has alleviated a short-term liquidity problem and adopted a 'fine-tuning' rather than a 'hand-to-mouth' philosophy. This can serve as a good example for other HMO's.