HMSA ended the fourth quarter with net income of $5.27 million, roughly equal to one third of one percent of revenue. As a nonprofit, HMSA does not pay dividends; when money is left over it is applied to future expenses.
For full year 2010, HMSA logged an operating loss of $26 million, offset by $28 million of investment and other income. The enterprise maintains an investment portfolio to cover losses where possible.
"It's encouraging to see our operating loss decline," said Steve Van Ribbink, chief financial officer. "We experienced an improved return on our investments and a small decline in health care costs."
HMSA revenue for the full year was $1.76 billion and Van Ribbink said 92 percent of it went directly to patient care. The operation continued a freeze on executive pay raises and on most hiring.
Kaiser Hawaii lost $2.3 million in the fourth quarter, a third of what it lost a year earlier; the loss would have been more but Kaiser's own investment portfolio swung back into the black and contributed $1.4 million in income.
For the full year Kaiser Hawaii posted a net loss of $5.1 million, representing a negative 0.5 percent return on revenue. In 2009 the local Kaiser operation lost $7 million.
"We were able to trim losses in 2010 and grow membership," said Thomas Risse, chief financial officer.
HMSA, Hawaii Medical Services Association, is the largest health insurer in the state, with 676,801 members, and the islands' Blue Cross provider. Kaiser Permanente is the state's largest HMO, health maintenance organization, has 229,186 members.