Executive Letter

Kaiser Permanente continues to lead the way in transforming the future of health and health care, and 2016 was a strong year despite unprecedented changes in the health care industry. We provided high-quality, affordable, accessible health care to nearly 11 million Kaiser Permanente members last year while also reinforcing our commitment to support the health of the communities we serve.

We experienced steady financial performance, ending the year with nearly $65 billion in operating revenue. Our 2016 membership of 10.7 million members reflected growth across all lines of business. In addition, our capital spending of $2.8 billion reflected the importance of our investments in both technology and facilities to improve our member care and service. Kaiser Permanente opened a new information technology campus in Atlanta — creating an estimated 900 new IT jobs by 2019 — and completed two new dental offices in Oregon and 12 new medical offices nationwide.

Kaiser Permanente is known for the exceptional care provided by our Permanente Medical Group physicians and the personalized, coordinated approach of our skilled care teams. This past year, we continued to advance patient care through innovation and technology. Telehealth has made it more convenient for members to access our care and services, with more than half of the visits with our members completed “virtually” through email, phone and video. We are placing our members and patients at the center of all we do, providing them with choice in accessing the best Kaiser Permanente has to offer.

We had the honor of caring for many new members who had access to health care coverage for the first time in their lives through the state exchanges, and our dedicated physicians and care teams delivered life-saving medical care to many of these new members immediately after they joined Kaiser Permanente. This experience emphasizes the importance of preventive health in our communities, which is why our mission to provide accessible, affordable care is so vital.

We received recognition in 2016 for the quality of care we delivered to our members. Kaiser Permanente health plans were classified as among the best in the nation for consumer experience, prevention and treatment, according to the National Committee for Quality Assurance. In addition, all Kaiser Permanente health plans were again rated highest (or tied for highest) in both Medicare and commercial in the areas we serve. In 2016, 28 Kaiser Permanente hospitals were listed as “high performing” for one or more measures of common or complex care in U.S. News & World Report’s annual report. Five of Kaiser Permanente’s seven Medicare health plans received an overall rating of 5 stars — the highest rating — from the Centers for Medicare & Medicaid Services for 2016.

Helping our communities achieve total health remains an essential part of our mission, and Kaiser Permanente gave back $2.5 billion to provide care for low-income families, support community-based health partnerships, steward environmental initiatives, and conduct and share important medical research. In addition, Kaiser Permanente welcomed its first chief community health officer in 2016. This critical role brings even greater focus to our commitment of more than 70 years to address broad social issues that impact both personal and community health. In addition, we named a national leader of mental health and wellness, and initiated important work and conversations on mental health conditions and access to services. This included the launch of our “Find Your Words” campaign as well as national advertising calling attention to depression in young people.

These are only a few highlights of the progress we made in 2016. We invite you to read more about Kaiser Permanente’s performance and commitments in this year’s annual report. Thanks to our dedicated employees and our Permanente Medical Group physicians, we are transforming health care and coverage to achieve better health for all.

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Bernard J. Tyson
Chairman and CEO
Kaiser Foundation Health Plan, Inc.
Kaiser Foundation Hospitals

Geoffrey S. Sewell, MD, FACP
Chair, National Permanente Executive Committee
The Permanente Federation, LLC
President and Executive Medical Director
Hawaii Permanente Medical Group