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{{short description|American integrated managed care company}}
{| class="infobox" style="width: 20em; font-size: 90%;"
{{Use mdy dates|date=February 2017}}
|+ style="font-size: larger;" | '''Kaiser Permanente'''
{{Infobox company
|-
| logo = KP logo.svg
| colspan="2" style="text-align: center; padding: 16px 0 16px 0;" | ]
| image = One Kaiser Plaza.jpg
|-
| image_size = 250px
! style="text-align:right;" | ]
| image_caption = Headquarters (the ]) in ]
| ] health plan and <br />hospitals, ] medical groups
| type = ] of ] and ] entities.
|-
| foundation = {{start date and age|1945|7|21}}
! style="text-align:right;" | Founded
| founders = {{ubl|]|]}}
| 1945
| location = ]<br/>], U.S.
|-
| hq_location_city =
! style="text-align:right;" | Location
| hq_location_country =
| ]
| key_people = Greg A. Adams (Chairman & CEO)<br /> ]
|-
| members = 12.5 million
! style="text-align:right;" | ]
| members_year = 2022
| ]
| num_employees = 235,785 employees (including 73,618 nurses and 24,605 physicians as of 2023)<ref name=kpataglance/>
|-
| parent = Kaiser Foundation Health Plan, Inc.
! style="text-align:right;" | ]
| num_locations = 40 hospitals and 618 medical facilities (2022)
| {{profit}} $31.1 billion ] (2005) <ref></ref>
| area_served = {{ubl|]|]|]|]|]|]|]|]|]}}
|-
| industry = ]
! style="text-align:right;" | ]s
| services = ], ], ]
| 145,000
| revenue = {{profit}} $100.8 billion ] (2023)<ref name=kpataglance/>
|}
| operating_income = {{increase}} $329 million ] (2023)<ref name=kpataglance/>
'''Kaiser Permanente''' is an integrated ] (HMO), based in ], founded in 1945 by industrialist ] and physician ]. Kaiser Permanente is actually a consortium of three distinct entities composed of Kaiser Foundation Health Plans, Kaiser Foundation Hospitals, and The Permanente Medical Groups. "Kaiser Permanente" as a single entity does not technically exist. ], Kaiser operates in nine states and Washington, D.C., and is the largest non-profit HMO in the ]. Kaiser has 8.3 million health plan members, 134,000 employees, 11,000 physicians, 30 medical centers, 431 medical offices, and $22.5 billion in annual operating revenues. The umbrella organization Kaiser Foundation Health plan operates under the tax status of a ] organization, but a significant portion of Kaiser's excess income is distributed to medical groups.
| subsid = {{Unbulleted list | ] | The Permanente Federation, LLC | St Dominic's Hospital | The Permanente Medical Group, Inc. | Avivia Health | Buenaventura Medical Group Inc | Southern California Permanente Medical Group | 1800 Harrison Foundation | Kaiser Foundation Hospitals | The Southeast Permanente Medical Group, Inc. | Kaiser Permanente of Georgia, Inc. |Kaiser Permanente Center for Gun Violence Research and Education}}
| homepage =
}}


'''Kaiser Permanente''' ({{IPAc-en|ˈ|k|aɪ|z|ər|_|p|ɜr|m|ə|ˈ|n|ɛ|n|t|eɪ}}; '''KP''') is an American ] ], based in ], United States, founded in 1945 by industrialist ] and physician ]. Kaiser Permanente is made up of three distinct but interdependent groups of entities: the Kaiser Foundation Health Plan, Inc. (KFHP) and its regional operating subsidiaries; Kaiser Foundation Hospitals; and the regional Permanente Medical Groups. As of 2023,<ref name=":0">{{cite web | url=https://about.kaiserpermanente.org/who-we-are/fast-facts | title=Fast Facts }}</ref> Kaiser Permanente operates in eight states (], ], ], ], ], ], ], ]) and the ], and is the largest ] organization in the United States.<ref>{{cite web |title=A Brief Overview of Kaiser Permanente in 2022 |publisher=J. C. Lewis Insurance Services |date=March 31, 2022 |url=https://jclis.com/affordable-health-insurance/a-brief-overview-of-kaiser-permanente-in-2022/ |access-date=January 15, 2024}}</ref>
==Structure==
Kaiser provides care through eight regional divisions. Each of these regions are comprised of three co-dependent organisations. This structure has endured since Kaiser physicians and leaders agreed to this framework, known as the Tahoe Agreement, in 1955.


Kaiser Permanente operates 40 hospitals<ref name=":0" /> and more than 616 medical offices,<ref name=":0" /> with over 300,000 personnel, including more than 98,000 physicians and nurses.<ref name=":0" />
Kaiser is administered through eight regions, or divisions:
* ]
* ]
* ]
* ]
* ]
* Mid-Atlantic (vicinity of Washington, D.C. including ] and ])
* Northwest (Northwest ] and Southwest ])
* ]


Each Permanente Medical Group operates as a separate ] partnership or professional corporation in its individual territory, and while none publicly reports its financial results, each is primarily funded by reimbursements from its respective regional Kaiser Foundation Health Plan entity. KFHP is one of the largest not-for-profit organizations in the United States.
These regions are organized under three entities:
* Kaiser Foundation Health Plans work with employers, employees, and individual members to offer prepaid health plans. The health plans are not-for-profit and provide infrastructure for and invest in Kaiser Foundation Hospitals and for-profit medical groups.
* Kaiser Foundation Hospitals operate medical centers in three states and ] facilities throughout the Kaiser region. The hospital foundations are not-for-profit and primarily rely on the Kaiser Foundation Health Plans for funding. They also provide infrastructure and facilities that benefit for-profit medical groups.
* The Permanente Medical Groups are partnerships of physicians, which provide and arrange for medical care for Kaiser Foundation Health Plan members in each respective region. The medical groups are for-profit partnerships and also receive funding from Kaiser Foundation Health Plans. The first medical group, The Permanente Medical Group, formed in 1948 in Northern California.


KP's quality of care has been highly rated<ref>{{cite web |title=Kaiser Permanente Health Insurance Review 2022 |url=https://www.forbes.com/advisor/health-insurance/kaiser-permanente-health-insurance-review/ |website=Forbes.com |date=October 10, 2022 |access-date=October 10, 2022}}</ref> and attributed to an emphasis on preventive care, its doctors being salaried rather than paid on a ] basis, and an attempt to minimize the time patients spend in high-cost hospitals by carefully planning their stay.<!--Concerns and violations summary--> However, Kaiser has had disputes with its employees' unions; repeatedly faced civil and criminal charges for falsification of records and ]; faced action by regulators over the quality of care it provided, especially to patients with mental health issues; and faced criticism from activists and action from regulators over the size of its cash reserves.
The ] status of Kaiser Foundation Health Plans and Kaiser Foundation Hospitals is challenged by critics of the organization. These critics point out that the organization distributes profit to invest in for-profit medical groups and ]s.


==Structure and governance==
There was a major reorganization of Kaiser in 1996 when twelve Kaiser medical groups were unified within the Permanente Federation, which focuses on standardizing patient care and performance under one name and system of policies and the Permanente Company, which provides a central governance structure for corporate activities.<ref></ref>

Kaiser Permanente provides care throughout eight regions in the United States. Two or three (four, in the case of California) distinct but interdependent legal entities form the Kaiser system within each region. This structure was adopted by Kaiser Permanente physicians and leaders in 1955.

===Governance===
Each entity of Kaiser Permanente has its own management and governance structure, although all of the structures are interdependent and cooperative to a great extent. There are multiple affiliated nonprofits registered with the U.S. ]. According to ] governance questions, Kaiser Foundation Hospitals and Kaiser Foundation Health Plan do not have members with the power to appoint or elect board members, meaning that the ].<ref>. 2013. . 2013.</ref>

James A. Vohs was appointed CEO in 1978 and chairman in 1980, and he would serve until his retirement in 1992. He was the first chairman to not be a member of the Kaiser family.<ref>{{Cite web|title=Ascending the Ranks of Management, Kaiser Permanente Medical Care Program, 1957-1992: Oral History Transcript|url=http://content.cdlib.org/view?docId=hb8t1nb3kr&brand=calisphere&doc.view=entire_text|access-date=2020-11-17|website=content.cdlib.org|language=en}}</ref>

David M. Lawrence served as chairman and CEO until his retirement in 2002.<ref>{{Cite web|title=David M. Lawrence, M.D. - In First Person: An Oral History|url=https://www.ashrm.org/system/files/2018-03/Lawrence-Transcript-FINAL-100313-Rev4.pdf|access-date=2020-11-17|website=ashrm.org|language=en}}</ref>

] became the chairman and CEO until his retirement in December 2013.<ref name=finz>{{cite news| title=Kaiser CEO George Halvorson to retire| url=http://www.sfgate.com/business/article/Kaiser-CEO-George-Halvorson-to-retire-3920589.php| date=October 4, 2012| work=]| last=Finz| first=Stacy| publisher=sfgate.com| access-date=January 22, 2014}}</ref>

On November 5, 2012, the board of directors announced that ], Kaiser's president and chief operating officer for the last two years, would replace Halvorson,<ref name=terhune>{{cite news| title=Kaiser promotes Tyson to be CEO, chairman| url=https://www.latimes.com/business/la-fi-kaiser-ceo-20121106,0,5276065.story| last=Terhune| first=Chad| work=]| date=November 6, 2012| access-date=January 22, 2014}}</ref> marking the first time an ] was appointed as chairman.<ref>{{cite web |url=http://diversity-executive.com/articles/view/tyson-named-chairman-and-ceo-of-kaiser-permanente |title=Diversity Executive |access-date=2015-05-01 |url-status=dead |archive-url=https://web.archive.org/web/20140609200542/http://diversity-executive.com/articles/view/tyson-named-chairman-and-ceo-of-kaiser-permanente |archive-date=June 9, 2014 |df=mdy-all }}</ref> Tyson died in November 2019.<ref>{{cite web |url=https://www.nytimes.com/2019/11/11/business/bernard-j-tyson-dead.html |title=Bernard J. Tyson, Chairman of Health Care Giant, Dies at 60 |work=]|date=2019-11-11|access-date=2019-12-31 }}</ref>
Greg A. Adams assumed the role of chairman and CEO in December 2019.<ref>{{Cite web|title=Greg A. Adams|url=https://about.kaiserpermanente.org/who-we-are/leadership-team/national-leaders/greg-a-adams|access-date=2020-10-15|website=about.kaiserpermanente.org|language=en}}</ref>

===Operations===
As of 2022, Kaiser Permanente had 12.6 million ] members, 216,776 employees, 23,597 physicians, 63,847 nurses, 39 medical centers, and 724 medical facilities.<ref>{{cite news|url=https://www.forbes.com/sites/brucejapsen/2019/07/12/85000-kaiser-permanente-health-workers-threaten-strike/#2f63338c380f|title=85,000 Kaiser Permanente Health Workers Threaten Strike|last=Japsen|first=Bruce|work=Forbes|date=2019-06-12|access-date=31 December 2019}}</ref><ref>{{cite web|url=https://about.kaiserpermanente.org/who-we-are/fast-facts|title=Fast Facts|website=Kaiserpermanente.org|access-date=31 December 2019}}</ref><ref name=kpataglance>{{cite web| url=https://ataglance.kaiserpermanente.org/| publisher=Kaiser Permanente| title=Kaiser Permanente At a Glance| access-date= August 2, 2021| archive-url=https://web.archive.org/web/20190416113721/https://ataglance.kaiserpermanente.org/| archive-date=April 16, 2019| url-status=live}}</ref> As of December 31, 2022, the ] Kaiser Foundation Health Plan and Kaiser Foundation Hospitals entities reported an operating loss of $1.3 billion in net income on $95.4 billion in operating revenues.<ref name=kp2018stats>{{cite web| url=https://about.kaiserpermanente.org/news/kaiser-foundation-health-plan-and-hospitals-2022-financial-results/| publisher=Kaiser Permanente| title=Kaiser Permanente 2022 Annual Report| access-date=Mar 27, 2023}}</ref>

The two types of organizations which make up each regional entity are:
* Kaiser Foundation Health Plans (KFHP) work with employers, employees, and individual members to offer prepaid health plans and insurance. The ]s are not-for-profit and provide infrastructure for and invest in Kaiser Foundation Hospitals and provide a tax-exempt shelter for the for-profit medical groups.
* Permanente Medical Groups are physician-owned organizations, which provide and arrange for medical care for Kaiser Foundation Health Plan members in each respective region. The medical groups are for-profit partnerships or professional corporations and receive nearly all of their funding from Kaiser Foundation Health Plans. The first medical group, The Permanente Medical Group (TPMG), formed in 1948 in Northern California, is one of the largest doctors groups in the United States with 11,225 medical professionals and 186 locations at the beginning of 2023.<ref>{{cite web |url=https://www.nursinghomedatabase.com/doctors-group/8921910225/permanente-medical-group-inc|title=PERMANENTE MEDICAL GROUP INC Reviews, Ratings, and Physician Information |access-date=2023-02-17}}</ref> Permanente physicians become stockholders in TPMG after three years at the company.<ref>{{cite web|url=https://www.nytimes.com/1983/07/31/business/the-king-of-the-hmo-mountain.html|title=THE KING OF THE H.M.O. MOUNTAIN|date=July 31, 1983|work=The New York Times}}</ref>

In addition, Kaiser Foundation Hospitals (despite the plural name, a single legal entity) operates medical centers in California, Oregon,<ref>{{Cite web|title=Where Our Hospitalists Provide Care {{!}} Kaiser Permanente Washington|url=https://wa.kaiserpermanente.org/html/public/services/hospitalist|access-date=2020-08-28|website=wa.kaiserpermanente.org}}</ref> and Hawaii, and ] facilities in the remaining Kaiser Permanente regions. The hospital foundation entity is not-for-profit and relies on the Kaiser Foundation Health Plans for funding. It also provides infrastructure and facilities that benefit the for-profit medical groups.

===Regional entities===
Kaiser Permanente is administered through eight regions, including one parent and six subordinate ] entities, one hospital entity, and nine separate, affiliated medical groups:
{{cot|Various legal entities serve the areas of the US where Kaiser operates: California (the largest two), Colorado, Georgia, Hawaii, mid-Atlantic, Pacific Northwest, and Washington.}}
<!--Reduced ] by collapsing the minutae.-->
* ], 3,351,449 members<ref name=fast>{{cite web| title=Fast Facts about Kaiser Permanente| url=http://xnet.kp.org/newscenter/aboutkp/fastfacts.html| publisher=Kaiser Permanente| date=November 22, 2013| access-date=January 22, 2014}}</ref>
** Kaiser Foundation Health Plan, Inc. (KFHP)
** Kaiser Foundation Hospitals (KFH)
** The Permanente Medical Group, Inc. (TPMG)
* ], 3,499,035 members
** Kaiser Foundation Health Plan, Inc. (KFHP)
** Kaiser Foundation Hospitals (KFH)
** Southern California Permanente Medical Group (SCPMG)
* ], 531,908 members
** Kaiser Foundation Health Plan of Colorado (KFHPCO)
** Colorado Permanente Medical Group, P.C. (CPMG)
* ], 222,074 members
** Kaiser Foundation Health Plan of Georgia, Inc. (KFHPGA)
** The Southeast Permanente Medical Group, Inc. (TSPMG)
* ], 226,900 members
** Kaiser Foundation Health Plan, Inc. (KFHP)
** Kaiser Foundation Hospitals (KFH)
** Hawaii Permanente Medical Group, Inc. (HPMG)
* ] (vicinity of ], including ] and ]), 581,000 members
** Kaiser Foundation Health Plan of the Mid-Atlantic States Inc. (KFHPMA)
** Mid-Atlantic Permanente Medical Group, P.C. (MAPMG)
* ] (Northwest ] and Southwest ]), 480,386 members
** Kaiser Foundation Health Plan of the Northwest (KFHPNW)
** Kaiser Foundation Hospitals (KFH)
** Northwest Permanente, P.C. Physicians and Surgeons (NWP)
* Washington (except Southwest Washington), 681,386 members
**Kaiser Foundation Health Plan of Washington
**Washington Permanente Medical Group (] before 2017)
{{cob|}}
In addition to the regional entities, in 1997, the then-twelve Permanente Medical Groups created The Permanente Federation ], a separate entity, which focuses on standardizing patient care and performance under one name and system of policies.<ref>The Permanente Federation LLC was formed under the laws of the ] on January 8, 1997. Delaware business entity number 2704178. The entity is with the California Secretary of State. Retrieved February 4, 2020.</ref> Around the same time, The Permanente Company was also chartered as a vehicle to provide investment opportunities for the for-profit Permanente Medical Groups.<ref name=crosson>{{cite news| title=A New Moment in the History of Kaiser Permanente| url=http://www.thepermanentejournal.org/files/Fall1997/history.pdf| work=Permanente Journal| date=Fall 1997 |volume=1 |issue=2| last=Crosson, MD| first=Francis J.| publisher=Kaiser Permanente| access-date=January 22, 2014}}</ref> One of the ventures of the Permanente Company is Kaiser Permanente Ventures, a venture capital firm that invests in emerging medical technologies.<ref name=about>{{cite web| url=http://www.kpventures.com/about-us.aspx| publisher=Kaiser Permanente Ventures| title=About Us| access-date=January 22, 2014| url-status=dead| archive-url=https://web.archive.org/web/20140129194904/http://www.kpventures.com/about-us.aspx| archive-date=January 29, 2014| df=mdy-all}}</ref>
]

===Lobbying entity===

A mutual benefit corporation named "Kaiser Foundation for the Advancement of Integrated Health Care" was established on December 27, 2017. The specific purpose of the corporation is "to advocate for and promote the integrated models of health care".<ref> of Kaiser Foundation for the Advancement of Integrated Health Care.</ref> The corporation's founder, Maryann Bodayle, has served as the "Governance Administrator" of Kaiser Foundation Health Plan, Inc. since 2013.


==History== ==History==
]
Kaiser was founded in 1933 at ] in ]. Garfield opened the Contractors General Hospital, with twelve beds, to treat construction workers building the ] in the ]. The hospital was in a precarious financial state. Harold Hatch, an insurance agent, proposed that the insurance companies pay the hospital a total amount, in advance, for each worker covered. The financial relationship between the insurance companies and the hospital worked, and allowed Garfield to build on a new idea: ].


===Early years===
Observing the concept developed by Hatch and Garfield in the Mojave Desert, Henry Kaiser persuaded Garfield to open a prepaid practice for his construction workers who, in 1938, were building the ] in Washington state. This coverage was later extended to the families of the workers. In 1942, Kaiser established health plans for workers and families at ]s in ] and ], and at a ] in ]. In 1945, Kaiser extended membership to the public, as membership had dropped to 11,000 following ]. When the shipyards closed in 1946, membership dropped to 25,000, from a height of 200,000.
The history of Kaiser Permanente dates to 1933 and a tiny hospital in the town of ]. At that time, ] and several other large construction contractors had formed an insurance consortium called Industrial Indemnity to meet their ] obligations. Sidney Garfield had just finished his residency at ] at a time when jobs were scarce; he was able to secure a contract with Industrial Indemnity to care for 5,000 construction workers building the ] in the ]. Soon enough, Garfield's new hospital was in a precarious financial state (with mounting debt and the staff of three going unpaid), due in part to Garfield's desire to treat all patients regardless of ability to pay, as well as his insistence on equipping the hospital adequately so that critically injured patients could be stabilized for the long journey to full-service hospitals in Los Angeles.<ref name=hendricks>{{cite book| first=Rickey| last=Hendricks| title=A Model for National Health Care: The History of Kaiser Permanente| location=New Brunswick, NJ| publisher=Rutgers University Press| year=1993| pages=13–17| isbn=978-0813519296}}</ref>{{rp|19–26}}


However, Garfield won over two Industrial Indemnity executives, Harold Hatch and Alonzo B. Ordway. It was Hatch who proposed to Garfield the specific solution that would lead to the creation of Kaiser Permanente: Industrial Indemnity would prepay 17.5% of premiums, or $1.50 per worker per month, to cover work-related injuries, while the workers would each contribute five cents per day to cover non-work-related injuries. Later, Garfield also credited Ordway with coming up with the general idea of prepayment for industrial health care and explained that he did not know much at the time about other similar ]s except for the ].<ref>Hendricks, 26-27</ref>
Between 1952 and 1955, membership grew to 500,000, as Kaiser worked with ] leaders to extend health care to all unionized employees. In 1958, Kaiser added Hawaii to its initial three regions in Northern California, Southern California, and Oregon. Membership reached one million by 1963. In 1969, Kaiser added regions in Colorado and Ohio. Nine years later, in 1976, membership reached three million.


Hatch's solution enabled Garfield to bring his budget back into the positive, and to experiment with providing a broader range of services to the workers besides pure emergency care. By the time work on the aqueduct concluded and the project was wrapped up, Garfield had paid off all of his debts, was supervising ten physicians at three hospitals, and controlled a financial reserve of $150,000.<ref>Hendricks, 28</ref>
By 1977, all six of Kaiser's regions had become federally-qualified HMOs. Some believe President Nixon specifically had Kaiser in mind when he signed the ], as the organization is mentioned in an ] discussion of the Act.<ref></ref> In 1980, Kaiser acquired a non-profit group practice to create the Mid-Atlantic region, encompassing the District of Columbia, Maryland, and Virginia. In 1985, Kaiser added Georgia.


Garfield returned to Los Angeles for further study at County-USC with the intent of entering private practice. However, in March 1938, Consolidated Industries (a consortium led by the Kaiser Company) initiated work on a contract for the upper half of the ] in Washington state, and took over responsibility for the thousands of workers who had worked for a different construction consortium on the first half of the dam. Edgar Kaiser, Henry's son, was in charge of the project. To smooth over relations with the workers (who had been treated poorly by their earlier employer), Hatch and Ordway persuaded Edgar to meet with Garfield, and in turn Edgar persuaded Garfield to tour the Grand Coulee site. Garfield subsequently agreed to reproduce at Grand Coulee Dam what he had done on the Colorado River Aqueduct project. He immediately spent $100,000 on renovating the decrepit Mason City Hospital and hired seven physicians.<ref>Hendricks, 28-35</ref>
The geographic reach of the organization has changed over time. Kaiser ultimately abandoned outposts in ], ], and the ]. In 1998 Kaiser sold its ] operations, where reported problems had become so severe that Kaiser directed its lawyers to attempt to block the release of a Texas Department of Insurance report. This prompted the state attorney general to threaten to . In ], the Industrial Union Department of the ] issued a 1996 report critical of Kaiser's quality; soon thereafter Kaiser closed the North Carolina health plans in four years later. Kaiser also sold its unprofitable Northeast division in 2000.


Unlike the workers on Garfield's first project, many workers at Grand Coulee Dam had brought dependents with them. The unions soon forced the Kaiser Company to expand its plan to cover dependents, which resulted in a dramatic shift from ] into ] and enabled Garfield to formulate some of the basic principles of Kaiser Permanente. It was also during this time that Henry Kaiser personally became acquainted with Garfield and forged a friendship which lasted until Kaiser's death.<ref>Hendricks, 36-38</ref>
In 1995, Kaiser celebrated its 50th anniversary as a public health plan. Two years later, membership reached nine million. In 1997, Kaiser established an agreement with the AFL-CIO to explore a new approach to the relationship between management and ], known as the Labor-Management Partnership.


===World War II===
In 1999, a number of groups successfully sued Kaiser in regard to its “In the Hands of Doctors” advertising campaign. The lawsuit revealed that Kaiser doctors were not fully in control of decision-making and that they had been persuaded to limit care with financial bonuses.
]


In 1939, the Kaiser Company began work on several huge shipbuilding contracts in Oakland, and by the end of 1941 would control four major shipyards on the West Coast. During 1940, the expansion of the American defense-industrial complex in preparation for entrance into ] resulted in a massive increase in the number of employees at the Richmond shipyard.<ref>Herman, Arthur. ''Freedom's Forge: How American Business Produced Victory in World War II,'' pp. 176-91, Random House, New York, NY. {{ISBN|978-1-4000-6964-4}}.</ref> In January 1941, Henry Kaiser asked Garfield to set up an insurance plan for the Richmond workers (this was merely contract negotiation with insurance companies), and a year later Kaiser asked Garfield to duplicate at Richmond what he had done at Desert Center and Mason City.<ref>Hendricks, 40-47</ref> Unlike the two other projects, the resulting entity lived on after the construction project that gave birth to it, and it is the direct ancestor of today's Kaiser Permanente.<ref name=autogenerated4>Hendricks, 63</ref>
During the 1990s, Kaiser hired various ] firms to magnify their brand. These firms include ] to position their brand in Washington, D.C., to secure tax incentives and a special hearing for government grants, and Edelman PR for general public relations and crisis management. In 2004, Kaiser hired ] to develop a $40-million-dollar ad campaign called "]". The campaign, which focuses on the theme of ], was the first since Kaiser's “In the Hands of Doctors” campaign.


On March 1, 1942, Sidney R. Garfield & Associates opened its offices in Oakland to provide care to 20,000 workers, followed by the opening of the Permanente Health Plan on June 1.<ref>Hendricks, 49</ref> From the beginning, Kaiser Permanente strongly supported ] and attempted to educate its members about maintaining their own health.<ref>Hendricks, 58</ref>
== International Reputation ==

In 2005 the British ] conducted a study that compared Kaiser to the British ].<ref>{{cite journal | author=Feachem RG, Sekhri NK, White KL | title=Getting more for their dollar: a comparison of the NHS with California's Kaiser Permanente | journal=BMJ | year=2002 | pages=135-41 | volume=324 | issue= | id=PMID 11799029}}</ref> The outcome of this study was . An editorial in the ] initially indicated that Kaiser managed similar costs to the NHS, but this generated argument, and it was generally accepted that the NHS was cheaper and more efficient whereas Kaiser may be more rapid.
In July, the Permanente Foundation formed to operate Northern California hospitals that would be linked to the outpatient ]s, followed shortly thereafter by the creation of Northern Permanente Foundation for Oregon and Washington and Southern Permanente Foundation for California. The name Permanente came from ], which flowed past Henry Kaiser's ] on ] in ]. Kaiser's first wife, Bess Fosburgh, liked the name. An abandoned Oakland facility was modernized as the 170-bed Permanente Hospital opened on August 1, 1942 (this facility evolved over the decades into today's flagship ]). Three weeks later, the 71-bed Richmond Field Hospital opened. Six first aid stations were set up in the shipyards to treat industrial accidents and minor illness. Each first aid station had an ambulance ready to rush patients to the surgical field hospital if required. Stabilized patients could be moved to the larger hospital for recuperative care.<ref name=PdK/> The Northern Permanente Hospital opened two weeks later to serve workers at the Kaiser shipyard in ].<ref>Hendricks, 49-50</ref> Shipyard workers paid seven cents per day for comprehensive health care coverage, and within a year, the shipyard health plan employed sixty physicians with salaries between $450 and $1,000 per month. These physicians established ] to offer similar health coverage to the families of shipyard workers.<ref name=PdK>{{cite journal |last=de Kruij |first=Paul |year=1943 |title=Tomorrow's Health Plan -- Today! |journal=] |volume=42 |issue=253 |pages=61–64 |publisher=The Reader's Digest Association }}</ref> In 1944, Kaiser decided to continue the program after the war and to open it up to the general public.<ref name=autogenerated4 />

Meanwhile, during the war years, the ] (AMA) (which opposed managed care organizations from their very beginning) tried to defuse demand for managed care by promoting the rapid expansion of the ] ] networks.<ref>Hendricks, 79</ref>

''Courage to Heal'', a novel by KP Historical Society President and Medical Director Emeritus of KP San Diego ], is based on the story of Garfield's life, his struggles with the AMA, and the origins of Kaiser Permanente.

===Postwar growth===
In 1943, Henry J. Kaiser and Dr. Sidney R. Garfield opened a 50-bed hospital, housing six physicians for the 3000 employees and their families at the new Kaiser Steel Mill in Fontana, California, offering a pre-paid health care plan for $0.60/week for adults, and $0.30/week for children. In 1945, the Kaiser Permanente health plan was opened to the public.

In 1948, Kaiser established the Henry J. Kaiser Family Foundation (also known as ]), a U.S.-based nonprofit, private operating ] focusing on the major health care issues facing the nation.<ref name=aboutKFF>{{cite web|title=More About the Kaiser Family Foundation|url=http://kff.org/more-about-the-kaiser-family-foundation/|website=kff.org|access-date=June 17, 2015}}</ref> The Foundation, not associated with Kaiser Permanente or ], is an independent voice and source of facts and analysis for policymakers, the media, the health care community, and the general public.<ref name=aboutKFF />

The end of World War II brought about a huge plunge in Kaiser Permanente membership; for example, 50,000 workers had left the Northern California yards by July 1945. Membership bottomed out at 17,000 for the entire system but then surged back to 26,000 within six months as Garfield aggressively marketed his plan to the public.<ref>Hendricks, 65</ref> Sidney Garfield & Associates had been a ], but in 1948, it was reorganized into a partnership, Permanente Medical Group.<ref>Hendricks, 185</ref>

During this period, a substantial amount of growth came from union members; the unions saw Kaiser Permanente care as more affordable and comprehensive than what was available at the time from private physicians under the fee-for-service system. For example, '']'' magazine had reported in 1944 that 90% of the U.S. population could not afford fee-for-service health care. Kaiser Permanente membership soared to 154,000 in 1950, 283,000 in 1952, 470,000 in 1954, 556,000 in 1956, and 618,000 in 1958.<ref>Hendricks, 66-75</ref>

From 1944 onward, both Kaiser Permanente and Garfield fought off numerous attacks from the AMA and various state and local medical societies. Henry Kaiser came to the defense of both Garfield and the ]s he had created.<ref>Hendricks, 96-101, 142-150</ref>

In 1951, the organization acquired its current name when Henry Kaiser unilaterally directed the trustees of the health plans, hospital foundations, and medical groups to add his name before Permanente.<ref>Hendricks, 111</ref> However, the physicians in the Permanente Medical Group were proud professionals who deeply resented the implication that they were directly controlled by Kaiser, and successfully forced him to back off with respect to their part of the organization. That same year, Kaiser Permanente also began experiments with large-scale multiphasic screening to identify unknown conditions and to facilitate treatment of known ones.<ref>Hendricks, 123-124</ref> Simultaneously, although no one questioned his medical competence, Garfield's deficiencies as an executive were becoming apparent as the organization expanded far beyond his ability to manage it properly.<ref>Hendricks, 133</ref>

With his wartime glory receding into history, Henry Kaiser became fascinated with the health care system created for him by Garfield and began to directly manage Kaiser Permanente and Garfield. This resulted in a financial disaster when Kaiser splurged on the new Walnut Creek hospital; his constant intermeddling led to significant friction at every level of the organization. The situation was not helped by Kaiser's marriage to Garfield's head administrative nurse (who had helped care for Kaiser's first wife on her deathbed), convincing Garfield to marry the sister of that nurse, and then having Garfield move in next door to him. Clifford Keene (who would eventually serve as president of Kaiser Permanente) later recalled that this arrangement resulted in a rather dysfunctional and combative family in charge of Kaiser Permanente.<ref>Hendricks, 165-167</ref>

Keene was an experienced Permanente physician whom Garfield had personally hired in 1946. During 1953 he had been trying to get a job at ], but on the morning of December 5, 1953, with internal tensions worsening day by day, Garfield met with Keene at the ] in San Francisco and asked him to turn around the organization. It took Keene 15 years to realize that Kaiser had forced Garfield to ask Keene to become his replacement. Due to the chaos on the board, Keene at first took control with the vague title of Executive Associate, but it soon became clear to everyone that he was actually in charge and Garfield was to become a lobbyist and "ambassador" for the ] concept.<ref>Hendricks, 174-180</ref>

However, even with Garfield relieved of day-to-day management duties, the underlying problem of Henry Kaiser's authoritarian management style continued to persist. After several tense confrontations between Kaiser and Permanente Medical Group physicians, the doctors met with Kaiser's top adviser, Eugene Trefethen, at Kaiser's personal estate near Lake Tahoe on July 12, 1955. Trefethen came up with the idea of a contract between the medical groups and the ]s and hospital foundations that would set out roles, responsibilities, and financial distribution.<ref>Hendricks, 189-190</ref> Trefethen, already a successful attorney, went on to a successful career with Kaiser Permanente and in retirement ].

While Keene and Trefethen struggled to fix the damage from Kaiser's ] and Garfield's ineffectual management, Henry Kaiser moved to ] in 1956 and insisted on expanding Kaiser Permanente into ] in 1958. He quickly ruined what should have been a simple project, and only a last-minute intervention by Keene and Trefethen in August 1960 prevented the total disintegration of the Hawaii organization.<ref>Hendricks, 199-203</ref> By that year, Kaiser membership had grown to 808,000.<ref>Hendricks, 209</ref>

===Managed care era===

Having overseen Kaiser Permanente's successful transformation from Henry Kaiser's health care experiment into a large-scale self-sustaining enterprise, Keene retired in 1975.<ref>Hendricks, 205</ref> By 1976, membership reached three million. In 1977, all six of Kaiser Permanente's regions had become federally qualified ].

In 1980, Kaiser acquired a nonprofit group practice to create its Mid-Atlantic region, encompassing the District of Columbia, Maryland, and Virginia. In 1985, Kaiser Permanente expanded to Georgia.<ref>{{cite journal |last1=Gitternman |first1=Daniel P. |title=The Rise and Fall of a Kaiser Permanente Expansion Region |journal=Milbank Quarterly |volume=81 |issue=4 |pages=567–601 |date=December 2003 |doi=10.1046/j.0887-378X.2003.00295.x |pmid=14678480 |pmc=2690244 }}</ref>

===Regional evolution===

By 1990, Kaiser Permanente provided coverage for about a third of the population of the cities of San Francisco and Oakland; total Northern California membership was over 2.4 million.<ref>Hendricks, 209, 215</ref>

Elsewhere, Kaiser Permanente did not do as well, and its geographic footprint changed significantly in the 1990s. The organization ] or closed outposts in ], ], and the ]. In 1998, Kaiser Permanente sold its Texas operations, where reported problems had become so severe that the organization directed its lawyers to attempt to block the release of a Texas Department of Insurance report. This prompted the state attorney general to threaten to revoke the organization's license.<ref name=olmos>{{cite news| title=Kaiser Is Facing Threat of a Shutdown in Texas| url=https://www.latimes.com/archives/la-xpm-1997-04-03-fi-44759-story.html| last=Olmos| first=David| date=April 3, 1997| work=Los Angeles Times| access-date=January 22, 2014}}</ref> Kaiser Permanente closed ]s in Charlotte and Raleigh-Durham<ref name=freudenheim>{{cite news| title=Kaiser Permanente Is Shutting Down Its H.M.O. In The Northeast| url=https://www.nytimes.com/1999/06/19/business/kaiser-permanente-is-shutting-down-its-hmo-in-the-northeast.html| last=Freudenheim| first=David| work=]| date=June 19, 1999| access-date=January 22, 2014}}</ref> in North Carolina four years later. The organization also sold its unprofitable Northeast division in 2000. The Ohio division was sold to ] in 2013.<ref name=magaw>{{cite news| url=http://www.crainscleveland.com/article/20130904/FREE/130909940| title=Kaiser Permanente's Ohio operations to be renamed HealthSpan| last=Magaw| first=Timothy| date=September 4, 2013| work=]| publisher=crainscleveland.com| access-date=January 22, 2014}}</ref>

In 1995, Kaiser Permanente celebrated its fiftieth anniversary as a public ]. Two years later, national membership reached nine million. In 1997, the organization established an agreement with the AFL-CIO to explore a new approach to the relationship between management and ], known as the Labor Management Partnership. Going into the new millennium, competition in the managed care market increased dramatically, raising new concerns. The Southern California Permanente Medical Group saw declining rates of new members as other managed care groups flourished.

In 2017, Kaiser acquired ], which serves clients in the state of Washington outside of Southwest Washington. Group Health was started in part from funds from longshoremen in Washington state, who were left out when Kaiser chose not to expand north of the Portland area.<ref>{{Cite web |title=Kaiser Permanente and Group Health Cooperative: Working Together Since 1950 |url=https://about.kaiserpermanente.org/content/internet/kp/kpcomms/en/who-we-are/our-history/kaiser-permanente-and-group-health-cooperative-working-together-.html |access-date=2023-04-15 |website=about.kaiserpermanente.org |language=en}}</ref>

On April 26, 2023, Kaiser announced it would acquire ]. As part of the deal, Geisinger would operate as an independent subsidiary, folded into a new non-profit group called ].<ref>{{cite news |last=Abelson |first=Reed |date=April 26, 2023 |title=Kaiser Permanente to Acquire Geisinger |url=https://www.nytimes.com/2023/04/26/health/kaiser-permanente-geisinger.html |newspaper=]}}</ref><ref>{{Cite web |title=Kaiser Permanente and Geisinger come together to launch Risant Health |url=https://www.geisinger.org/about-geisinger/news-and-media/news-releases/2023/04/26/15/46/kaiser-permanente-and-geisinger-come-together-to-launch-risant-health |access-date=2023-04-26 |website=www.geisinger.org |date=April 26, 2023 |language=en}}</ref> On June 21, 2024, it was announced that Risant Health would acquire ], a hospital system based in Greensboro, North Carolina.<ref>{{cite news |last=Johnson |first= Lillian |date= 21 June 2024|title= Risant Health, nonprofit created by Kaiser Permanente, to acquire Cone Health. Dr. Mary Jo Cagle explains why. |url= https://www.bizjournals.com/triad/news/2024/06/21/cone-health-greensboro-nc-risant-kaiser-permanente.html/|work= ] |location= |access-date= 21 June 2024}}</ref>

===KP HealthConnect===
In 2002, Kaiser Permanente abandoned its attempt to build its own clinical information system with ], writing off some $452 million in software assets. This ] failure led to major changes in the organization's approach to digital records. Under George Halvorson's direction, Kaiser looked closely at two ] vendors, ] and ], ultimately selecting Epic as the primary vendor for a new system, branded KP HealthConnect. Although Kaiser's approach shifted to "buy, not build," the project was unprecedented for a civilian system in size and scope. Deployed across all eight regions over six years and at a cost of more than $6 billion,<ref name=rauber>{{cite news| url=http://sanfrancisco.bizjournals.com/sanfrancisco/stories/2009/08/10/daily55.html| first=Chris| last=Rauber| title=More details on Kaiser Permanente job cuts, 650 to come in SoCal| work=San Francisco Business Times| date=August 12, 2009| access-date=January 22, 2014}}</ref> by 2010, it was the largest civilian electronic medical record system, serving more than 8.6 million Kaiser Permanente members, implemented at a cost exceeding a half million dollars per physician.<ref name=monegain>{{cite news| title=Kaiser KP HealthConnect rollout done| url=http://www.healthcareitnews.com/news/kaiser-kp-healthconnect-rollout-done| last=Monegain| first=Bernie| date=March 29, 2010| work=Healthcare IT News| publisher=healthcareitnews.com| access-date=January 22, 2014}}</ref> As of 2020 KP HealthConnect supports 12.2 million members.

===International reputation===

Early in the 21st century, the ] and ] became impressed with some aspects of the Kaiser operation and initiated a series of studies involving several health care organizations in England.<ref name=feachem>{{cite journal| title=Getting more for their dollar: a comparison of the NHS with California's Kaiser Permanente| last1=Feachem| first1=Richard G.A.| last2=Sekhri| first2=Neelam K.| last3=White| first3=Karen L.| journal=]| date=January 19, 2002| pages=135–143| volume=324| issue= 330| pmid=11799029| doi=10.1136/bmj.324.7330.135| pmc=64512}}</ref><ref name=bbc>{{cite news| title=NHS 'worse value than US provider'| url=http://news.bbc.co.uk/1/hi/health/1764713.stm| work=]| publisher=BBC.co.uk| date=January 17, 2002| access-date=January 22, 2014}}</ref> Visits occurred and suggestions of adopting some KP policies are currently active. The management of hospital bed-occupancy by KP, by means of integrated management in and out of hospital and monitoring progress against care pathways has given rise to trials of similar techniques in eight areas of the UK.

In 2002, a controversial study by California-based academics published in the ] compared Kaiser to the British ], finding Kaiser to be superior in several respects.<ref name=feachem/> Subsequently, a group of health policy academics who were experts on the NHS published a competing analysis claiming that Kaiser's costs were actually substantially higher than the NHS and for a younger and healthier population.<ref name=smith>{{Cite journal| issn=0960-1643| volume=54| issue=503| pages=415–21; discussion 422| last=Talbot-Smith| first=Alison |author2=Gnani, Shamini |author3=Pollock, Allyson M | author4-link=Denis Pereira Gray|author4=Pereira Gray, Denis | title=Questioning the claims from Kaiser| journal=The British Journal of General Practice| year=2004| pmid=15186560| pmc=1266198}}</ref>

===2023 strike===
From October 4 to 7, 2023, more than 75,000 Kaiser Permanente workers ].<ref>{{cite news|url=https://abcnews.go.com/Health/75000-health-care-workers-begin-strike-kaiser-permanente/story?id=103716474|title=More than 75,000 health care workers begin strike at Kaiser Permanente|first1=Mary|last1=Kekatos|first2=Marilyn|last2=Heck|first3=Jolie|last3=Lash|publisher=ABC News|date=October 4, 2023|accessdate=October 5, 2023}}</ref><ref>{{cite news|url=https://www.npr.org/2023/10/07/1204450951/kaiser-permanente-strike-ends-without-resolution-but-workers-are-prepared-to-str|title=Kaiser Permanente strike ends without resolution, but workers are prepared to strike again|first=Jackie|last=Forter|publisher=NPR|date=October 7, 2023|accessdate=October 7, 2023}}</ref> This has been regarded as the largest health care worker strike in U.S. history.<ref>{{cite news|url=https://www.cnn.com/2023/10/04/business/thousands-of-kaiser-permanente-workers-go-on-strike/index.html|title=75,000 Kaiser Permanente workers walk off the job. It's the largest health care worker strike in US history|first=Samantha|last=Delouya|publisher=CNN|date=October 4, 2023|accessdate=October 5, 2023}}</ref> A new four-year contract would later be ratified by 98.5% of the 85,000 members of the Coalition of Kaiser Permanente Unions on November 9, 2023.<ref>{{cite news|url=https://apnews.com/article/kaiser-permanente-health-care-workers-ratify-contract-ce2c3d5ee7554543956488c0372fa57b|title=Kaiser Permanente workers ratify contract after strike over wages and staffing levels|publisher=Associated Press|date=November 9, 2023|accessdate=November 9, 2023}}</ref>


==Quality of care== ==Quality of care==


In the California Healthcare Quality Report Card 2013 Edition, Kaiser Permanente's Northern California and Southern California regions, KP received four out of four possible stars in Meeting National Standards of Care. KP North and South also received three out of four stars in Members Rate Their HMO.<ref name=opa>{{cite web| title=HMO Quality Ratings Summary 2013 Edition| url=http://reportcard.opa.ca.gov/rc2013/hmorating.aspx| publisher=California Office of the Patient Advocate| access-date=January 22, 2014}}</ref> KP's performance has been attributed to three practices: First, KP places a strong emphasis on preventive care, reducing costs later on. Second, its doctors are salaried rather than paid per service, which removes the main incentive for doctors to perform unnecessary procedures. Thirdly, KP attempts to minimize the time patients spend in high-cost hospitals by carefully planning their stay and by shifting care to outpatient clinics. This practice results in lower costs per member, cost savings for KP and greater doctor attention to patients. A comparison to the UK's ] found that patients spend 2–5 times as much time in NHS hospitals as compared to KP hospitals.<ref>{{cite journal|title=Getting more for their dollar: a comparison of the NHS with California's Kaiser Permanente | pmc=64512 | pmid=11799029|volume=324|date=January 2002|vauthors=Feachem RG, Sekhri NK, White KL |journal=] | issue=7330 |pages=135–41 |doi=10.1136/bmj.324.7330.135}}</ref><ref name=economist>{{cite news| title=The health of nations| url=https://www.economist.com/node/2895909| publisher=Economist.com| date=July 15, 2004| newspaper=]| access-date=January 22, 2014}}</ref>
Kaiser, more than any other HMO, has come under fire from advocacy groups such as and , who claim Kaiser withholds information about costly medical services to control costs. These critics argue that Kaiser reduces obligations for medical care by 'managing' the information provided to patients regarding available services and how to access them. Alleged strategies include promoting less-costly preventive procedures while suppressing information about other elective and/or expensive services; presenting services as relatively easy (e.g., primary care) or difficult (e.g., specialists) to utilize; and using delays for cost containment strategy. Such delays are accomplished through engaging in an elaborate referral process, limiting the number of contracted specialists, restricting appointment availability (or making appointments inconvenient), and by increasing office visit waiting periods.<ref> PubMed, 1994</ref>


In June 2013, the California Department of Managed Health Care (DMHC) levied a $4 million fine, the second largest in the agency's history, against Kaiser for not providing adequate mental health care to its patients. Alleged violations of California's timely access laws included failures to accurately track wait times and track doctor availability amid evidence of inconsistent electronic and paper records. It was also found by the DMHC that patients received written materials circulated by Kaiser dissuading them from seeking care, a violation of state and federal laws. DMHC also issued a cease and desist order for Kaiser to end the practices.<ref>{{cite web|last1=Nicol|first1=Jake|title=A Flawed Model for Care|url=http://www.eastbayexpress.com/oakland/a-flawed-model-for-care/Content?oid=4042723&showFullText=true|website=www.eastbayexpress.com|date=August 13, 2014|access-date=March 22, 2015}}</ref><ref name=KHN2015>{{Cite web|url=https://khn.org/news/kaiser-permanente-faulted-again-for-mental-health-care-in-california/|title=Kaiser Permanente Faulted Again For Mental Health Care Lapses In California|first=Jenny|last=Gold|date=February 25, 2015}}</ref> DMHC conducted a follow-up investigation which published in April 2015. The report found Kaiser had put systems in place to better track how patients were being cared for but still had not addressed problems with actually providing mental health care that complied with state and federal laws.<ref name=KHN2015/> Kaiser's challenges on this front were exacerbated by a long, unresolved ] with the union representing therapists.<ref name=KHN2015/>
Critics have also objected to overcrowded ]s and long wait times, that have resulted in a number of deaths. In the year 2000, the state of California imposed a record fine of $1 million dollars on Kaiser for repeated delays in care that resulted in the death of Margaret Utterback.. The elderly may be especially vulnerable to the issues surrounding quality of care. In 2004, a patient sued Kaiser under California law for "]" and was awarded $100,000 in arbitration.


Kaiser appealed the findings, the order, and the fine, and sought to keep the proceedings closed, but in September 2014, in the face of the administrative judge's order to keep the proceedings open, and facing the beginning of public testimony, Kaiser withdrew the appeal and paid the $4 million. It also issued a statement which denied much of the wrongdoing. Kaiser faces ongoing inspections by DMHC and three class-action lawsuits related to the issues identified by the DMHC.<ref>Cynthia H. Craft for the Sacramento Bee. September 9, 2014 </ref>
Kaiser behavioral medicine practices have also been questioned since they favor drug-based symptom control over one-on-one therapy in order to save costs. Adolescent care for depressed patients consists of prescription drugs and group therapy, even though, with the exception of Prozac, no antidepressant has been approved for children by the FDA, and they all carry "black box" warnings. Critics complaint that Kaiser has been lax in upholding the FDA requirement that when antidepressants are prescribed, they must be accompanied by full disclosure to the patient and parents, including the FDA medical guide. Critics also charge that complaints against Kaiser and questioning drug therapy have resulted in pressure on patients, including reporting parents to Child Protective Services for "medical negligence" and preventing parents who might complain Kaiser's group therapy, from attending those sessions, thus denying children part of their prescribed care.


==Research and publishing==
Kaiser's critics have also raised concerns that doctors get bonuses for providing inferior care. In 2002, Kaiser call center representatives were given bonuses for limiting doctor visits. The critics have also alleged ] in the organization's quality claims, since the main quality measurement organization, the ] (NCQA) is funded and overseen by a coalition of HMOs .
Kaiser operates a Division of Research, which annually conducts between 200 and 300 studies, and the Center for Health Research, which in 2009 had more than 300 active studies. Kaiser's bias toward prevention is reflected in the areas of interest—vaccine and genetic studies are prominent. The work is funded primarily by federal, state, and other outside (non-Kaiser) institutions.<ref name=research>{{cite web| title=About the Division of Research| url=http://www.dor.kaiser.org/external/DORExternal/about/index.aspx| publisher=Kaiser Permanente| access-date=January 22, 2014}}</ref>


Kaiser has created and operates a voluntary ] of donated blood samples from members along with their medical record and the responses to a lifestyle and health survey.<ref name="nia research bank">{{cite web |url=https://www.nia.nih.gov/research/resource/kaiser-permanente-kp-research-bank |title=Kaiser Permanente (KP) Research Bank |access-date=November 8, 2018 |publisher=National Institute on Aging, US Department of Health & Human Services}}</ref> As of November 2018, the Kaiser Permanente Research Bank had over 300,000 samples, with a goal of 500,000. De-identified data is shared with both Kaiser researchers and researchers from other institutions.<ref name="For researchers">{{cite web |url=https://researchbank.kaiserpermanente.org/our-research/for-researchers/ |access-date=November 8, 2018 |publisher=Kaiser Permanente |title=For Researchers}}</ref><ref name="researchFAQ">{{cite news |url=https://researchbank.kaiserpermanente.org/faq/ |access-date=November 8, 2018 |publisher=Kaiser Permanente |title=Frequently Asked Questions|newspaper=Kaiser Permanente Research Bank }}</ref>
While critics have exposed significant problems in patient care, enrollee satisfaction with assorted Kaiser plans varies significantly by region. A 2004 ] study of planholders showed below average ratings in the Colorado and DC/MD/VA regions for two measures of patient care: patient care and the quality of their primary care physician. The same survey gave a top rating to Kaiser's Northern California region for customer service, while giving average ratings for patient care measures. .


==Kaiser Permanente Bernard J. Tyson School of Medicine==
Critics of Kaiser's Thrive advertising campaign have also raised concerns about advertising ] and ].
{{main|Kaiser Permanente Bernard J. Tyson School of Medicine}}


Kaiser Permanente announced its plan to start a medical school in December, 2015, and the school welcomed its inaugural class in June, 2020.<ref>{{Cite web|url=https://khn.org/news/kaiser-permanente-to-open-medical-school-in-southern-california/|title=Kaiser Permanente To Open Medical School In Southern California|last=KQED|first=Lisa Aliferis|date=2015-12-17|website=Kaiser Health News|language=en-US|access-date=2020-01-03}}</ref> The vision for the school is to redesign physician education around the pillars of patient-centered care, population health, quality improvement, team-based care, and health equity.<ref>{{Cite web|url=https://about.kaiserpermanente.org/our-story/news/announcements/kaiser-permanente-bernard-j-tyson-school-of-medicine|title=Kaiser Permanente Bernard J. Tyson School of Medicine|website=about.kaiserpermanente.org|language=en|access-date=2020-01-03}}</ref>
]'s annual ranking of ] commercial health plans list Kaiser Hawaii at No. 45 (out of over 250 health plans), Kaiser Northern California at No. 58, and Kaiser Southern California at No. 88 in 2005.<ref></ref>


Mark Schuster was named the medical school's Founding Dean and CEO in 2017. The Kaiser Permanente Bernard J. Tyson School of Medicine was renamed from the Kaiser Permanente School of Medicine in November 2019 in honor of late Kaiser Permanente Chairman and CEO ].<ref>{{Cite press release|url=https://www.prnewswire.com/news-releases/kaiser-permanente-school-of-medicine-to-be-named-in-honor-of-late-chairman-and-ceo-bernard-j-tyson-300960379.html|title=Kaiser Permanente School of Medicine to be Named in Honor of Late Chairman and CEO Bernard J. Tyson|last=Permanente|first=Kaiser|website=www.prnewswire.com|language=en|access-date=2020-01-03}}</ref> The medical school received preliminary ] accreditation in February 2019 and received full LCME accreditation in June 2024. The school will waive all tuition for the full four years of medical school for its first five classes.<ref>{{Cite news|url=https://permanente.org/kaiser-permanente-school-of-medicine-to-open-summer-2020/|title=Kaiser Permanente School of Medicine to open summer 2020|date=2019-02-19|website=Permanente Medicine|language=en-US|access-date=2020-01-03}}</ref>   
== Dispute handling ==
In order to contain costs Kaiser requires agreement by those enrolling in the schemes that disputes including patient ] claims to submit to arbitration rather than litigating through the court system.


==Controversies ==
This has triggered some discussion and dissent<ref>Chris Rauber. ''San Francisco Business Times.'' February 20, 1998.</ref>. Some cases proceed to court and one argument is over whether the requirement to go through dispute resolution is enforceable.


===Patient dumping===
Kaiser implemented an Office of Independent Administrators (OIA) to oversee the arbitration process<!--in date....-->. The degree to whcih this is independent has been questioned <ref>The Foundation for Taxpayer & Consumer Rights. News Release. January 8, 2003.</ref>.


In 2006 Kaiser settled five cases for alleged ]—the delivery of homeless hospitalized patients to other agencies or organizations in order to avoid expensive medical care—between 2002 and 2005. ] city officials had filed civil and criminal legal action against Kaiser Permanente for patient dumping, which was the first action of its kind that the city had taken.<ref name="npr"/> The city's decision to charge Kaiser Permanente reportedly was influenced by security camera footage, allegedly showing a 63-year-old patient, dressed in hospital gown and slippers, wandering toward a mission on Skid Row (this footage was prominently featured in the ] 2007 documentary '']''). At the time that the complaint was filed, city officials said that 10 other hospitals were under investigation for similar issues.<ref name="npr">{{cite web| series=All Things Considered| url=https://www.npr.org/templates/story/story.php?storyId=6497254| title=Kaiser Faces Charges for Dumping Homeless Patient| last1=Jaffe| first1=Ina| last2=Block| first2=Melissa|date=November 16, 2006| work=]| agency=]| access-date=January 23, 2014}}</ref> Kaiser settled the case, paying $5,000 in civil penalties and agreeing to spend $500,000 on services for the homeless.<ref>Bob Herman for Modern Healthcare. August 28, 2014 </ref> During that same period, the ]' ] settled 102 cases against U.S. hospitals that resulted in a monetary payment to the agency.<ref name=oig>{{cite web| title=Archives — Patient Dumping 2002-2007| url=http://oig.hhs.gov/reports-and-publications/archives/enforcement/patient_dumping_archive.asp| publisher=HHS Office of Inspector General| access-date=January 23, 2014}}</ref><ref name=marquez>{{cite news| title=Trend: 'Dumping' Homeless on L.A.'s Skid Row| url=https://www.abcnews.go.com/GMA/story?id=1761873&page=1| last=Marquez| first=Miguel| work=]| date=March 24, 2006| access-date=January 23, 2014}}</ref>
Wilfredo Engalla is a lead case. In 1991, Engalla died of ] nearly five months after submitting a written demand for arbitration. The ] found<ref></ref> that Kaiser had a financial incentive to wait until after Engalla died; his spouse could recover $500,000 from Kaiser if the case was arbitrated while he was alive, but only $250,000 after he died. contends that Kaiser continues to oppose HMO arbitration reform<ref>The Foundation for Taxpayer & Consumer Rights. News Release. April 26, 2000.</ref>


===Organ transplant program===
Patients and consumer interest groups continue to fight for the right to file lawsuits against Kaiser. Recent lawsuits include attempt to use proof of a physician lie to overturn an Arbitration decision.


In 2004, Northern California Kaiser Permanente initiated an in-house program for kidney ]. Prior to opening the transplant center, Northern California Kaiser patients would generally receive transplants at medical centers associated with the University of California (] and ]). Upon opening the transplant center, Kaiser required that members who are transplant candidates in Northern California obtain services exclusively through its internal KP-owned transplant center.
==Criticism==
===Privacy concerns===
Kaiser is among a handful of HMOs evaluating patient records compiled for the ], a federal program under the auspices of the US ], designed to gather ] data on millions of American citizens regarding ] and health outcomes related to mass ] programs.


While it was in operation, the Kaiser program had a 100% survival rate, which is better than other transplant centers. However, patients who needed a kidney were less likely to be offered one.<ref name=ornstein>{{cite news| title=Kaiser Put Kidney Patients at Risk| url=https://www.latimes.com/news/local/la-me-kaiser3may03,0,7436765,full.story?coll=la-home-headlines| archive-url=https://web.archive.org/web/20071024150048/http://www.latimes.com/news/local/la-me-kaiser3may03,0,7436765,full.story?coll=la-home-headlines| url-status=dead| archive-date=October 24, 2007| last1=Ornstein| first1=Charles| last2=Weber| first2=Tracy| work=Los Angeles Times| date=May 3, 2006| access-date=January 23, 2014}}</ref> Northern California Kaiser performed 56 transplants in 2005, and twice that many patients died while waiting for a kidney. At other California transplant centers, more than twice as many people received kidneys than died during the same period. Unlike other centers, the Kaiser program did not perform riskier transplants or use donated organs from elderly or other higher-risk people, which have worse outcomes. Northern California Kaiser closed the kidney transplant program in May 2006. As before, Northern California Kaiser now pays for pre-transplant care and transplants at other hospitals. This change affected approximately 2,000 patients.<ref name=colliver>{{cite news| title=Record Kaiser fine expected| url=http://www.sfgate.com/default/article/SAN-FRANCISCO-Record-Kaiser-fine-expected-2514228.php| last=Colliver| first=Victoria| work=San Francisco Chronicle| publisher=SFgate.com| date=August 10, 2006| access-date=January 23, 2014}}</ref><ref name=nbc>{{cite news| title=Agency ignored organ transplant problems| url=https://www.nbcnews.com/id/15376648/ns/health-health_care/t/agency-ignored-organ-transplant-problems/| archive-url=https://web.archive.org/web/20140202113739/http://www.nbcnews.com/id/15376648/ns/health-health_care/t/agency-ignored-organ-transplant-problems/| url-status=dead| archive-date=February 2, 2014| work=]| date=October 22, 2006| agency=Associated Press| access-date=January 23, 2014}}</ref>
Critics have also questioned Kaiser's heavy investment in developing an ]. Some critics take issue with Kaiser's decisions to put revenue-generating aspects of the technology before benefit to patients. A string of technology leaks and blunders have also spawned ] concerns. For example, in 2000 Kaiser sent 858 emails to the wrong recipients , in 2005 Kaiser printed patient medical record numbers (MRNs) on mailed magazines , and in 2006 two temps used information gained from Kaiser medical records to commit ID theft.


===Medical experimentation=== ===Mandatory arbitration===
Kaiser requires an agreement by planholders to submit patient ] claims to ] rather than litigating through the court system. This has triggered some opposition.<ref name=rauber.arbitration>{{cite news| first=Chris| last=Rauber| url=http://www.bizjournals.com/sanfrancisco/stories/1998/02/23/story4.html| title=Kaiser fires back in arbitration suit| work=San Francisco Business Times| date=February 20, 1998| access-date=January 22, 2014}}</ref>
Critics are also investigating Kaiser's use of patients for vaccine testing without obtaining consent. Between June 1990 and October 1991, Kaiser, along with the ] Department of Health and the CDC, injected 900 mostly black and latino babies with an experimental measles vaccine. Although the vaccine was licensed in other countries, parents were not informed that the vaccine was unlicensed in the U.S. <ref>{{cite news

|author = Glenn, Beth
===Labor unions===
|title = Bad Blood Once Again
While ] (M.D.) and ] (D.O.) are partners within the for-profit physician groups, many employees are members of various unions and guilds, depending on their role and service area.
|work = St. Petersburg Times

|page = 5D
KP's California operations were subject to four labor strikes in 2011 and 2012, involving nurses, mental health providers, and other professionals.<ref name=hay>{{cite news| title=Two Kaiser unions strike in Santa Rosa, Northern California| url=http://www.pressdemocrat.com/article/20120131/articles/120139883#page=1| work=]| last=Hay| first=Jeremy| date=January 31, 2012| publisher=pressdemocrat.com| archive-url=https://web.archive.org/web/20140201235026/https://www.pressdemocrat.com/article/20120131/articles/120139883#page=1 |archive-date=February 1, 2014|url-status=dead| access-date=May 18, 2024}}</ref> The National Union of Healthcare Workers (NUHW) accused Kaiser of deliberately stalling negotiations while profiting $2.1 billion in 2011 and paying its CEO George Halvorson $9 million annually. The workers were dissatisfied with proposed changes to pensions and other benefits.<ref name=granitebay>{{cite news| title=Kaiser workers on strike| url=http://www.thepresstribune.com/article/kaiser-workers-strike| work=Roseville Press-Tribune| date=January 31, 2012| publisher=thepresstribune.com| archive-url=https://web.archive.org/web/20141106185817/http://www.thepresstribune.com/article/kaiser-workers-strike| archive-date=November 6, 2014|url-status=dead|access-date=May 18, 2024}}</ref>
|date = ]

|accessdate = 2006-05-14
On November 11, 2014, an estimated 18,000 nurses went on strike at KP hospitals in Northern California over ] safeguards and patient-care standards during union contract talks. 21 hospitals and 35 clinics in the ] were affected.<ref>{{cite web|url=http://www.nbcbayarea.com/news/local/Kaiser-Nurses-to-Hold-2-Day-Strike-Over-Ebola-Protections-282214461.html|title=Kaiser Nurses Holding 2-Day Strike Over Staffing Levels, Ebola Protections|work=NBC Bay Area|date=November 11, 2014 }}</ref>
}}

</ref>
In October 2023, as many as 75,000 Kaiser healthcare workers went on a three-day strike at KP hospitals and clinics. The Union had accused Kaiser of failing to address critical staff shortages, and demanded higher pay for staff. In November 2023 the workers voted to ratify a new four-year contract that addressed the demands.<ref>{{cite web |title=Kaiser healthcare workers ratify new contract |url=https://www.reuters.com/business/healthcare-pharmaceuticals/kaiser-healthcare-workers-ratify-new-contract-2023-11-09/ |website=Reuters.com |publisher=Reuters}}</ref>

On October 21, 2024, 2,400 Kaiser Permanente Southern California mental health therapists, psychologists, and psychiatric nurses went on strike for equity. The National Union of Healthcare Workers members are striking for adequate staffing and time to complete all patient care tasks, pay increases that are equitable to other Kaiser employees and that keep up with inflation, and the restoration of pension benefits to match what 95% or more Kaiser employees are already receiving. This strike is ongoing as of 12/25/2024. <ref>{{Cite web|url=https://home.nuhw.org/2024/12/03/kaiser-mental-health-care-strike-day-43/|title=Kaiser Mental Health Care Strike: Day 43|date=December 3, 2024|access-date=December 8, 2024}}</ref>

The California Department of Managed Healthcare () has begun investigating Kaiser's contingency plan during the strike. Kaiser reports that they have comprehensive plans to ensure patient access to care, and this is currently being closely monitored by the .<ref>{{cite web
|title=Press Release: California Department of Managed Health Care Investigates Kaiser Permanente Strike Contingency Plan
|url=https://www.dmhc.ca.gov/Resources/Newsroom/PressReleases/October21,2024.aspx
|website=DMHC
|publisher=California Department of Managed Health Care
|date=21 October 2024
|access-date=8 December 2024
}}</ref>

=== Strikes and Labor Disputes ===
Kaiser Permanente has experienced numerous labor disputes and strikes across its history, often centered on staffing levels, wages, and working conditions. These disputes have involved several unions, including the ] (NUHW), the ] (AHCU), and the Coalition of Kaiser Permanente Unions (CKPU). Below is a comprehensive account of major strikes involving these unions.

==== National Union of Healthcare Workers (NUHW) Strikes ====
The National Union of Healthcare Workers (NUHW) has led several significant strikes involving Kaiser Permanente employees. These strikes often focused on issues such as staffing shortages, patient care, and working conditions.

* '''January 12–16, 2015:''' Approximately 2,600 mental health clinicians and 700 optical workers in California conducted a five-day strike to protest staffing shortages and patient care issues.<ref>{{cite web |title=NUHW to Strike Kaiser on Jan 12-16 |url=https://nuhw.org/press-release/nuhw-to-strike-kaiser-on-jan-12-16/ |publisher=National Union of Healthcare Workers |access-date=December 8, 2024}}</ref>

* '''December 10–14, 2018:''' Approximately 4,000 mental health clinicians and other healthcare professionals in California participated in a five-day strike advocating for improved patient care and working conditions.<ref>{{cite news |last=Karlamangla |first=Soumya |title=Kaiser Permanente mental health workers strike over patient care concerns |url=https://www.latimes.com/business/la-fi-kaiser-mental-health-strike-20181210-story.html |work=Los Angeles Times |date=December 10, 2018 |access-date=December 8, 2024}}</ref>

* '''March 18–22, 2019:''' NUHW-represented mental health clinicians conducted a five-day strike addressing issues related to patient care and staffing.<ref>{{cite news |last=Anderson |first=Melanie |title=Kaiser Permanente mental health clinicians strike |url=https://www.sacbee.com/news/local/health-and-medicine/article236569613.html |work=The Sacramento Bee |date=March 18, 2019 |access-date=December 8, 2024}}</ref>

* '''November 11–15, 2019:''' Mental health clinicians and healthcare professionals held a five-day strike to protest staffing shortages and advocate for better patient care.<ref>{{cite web |title=Kaiser workers announce five-day statewide strike |url=https://nuhw.org/kaiser-workers-announce-five-day-statewide-strike-ramp-up-social-media-campaign/ |publisher=National Union of Healthcare Workers |date=October 31, 2019 |access-date=December 8, 2024}}</ref>

* '''August 15 – October 18, 2022:''' Nearly 2,000 mental health therapists in Northern California engaged in a 10-week strike, concluding with a tentative agreement addressing patient care and staffing concerns.<ref>{{cite news |title=Kaiser Permanente therapists reach deal after 10-week strike |url=https://www.healthcaredive.com/news/kaiser-strike-mental-health-california-hawaii-deal/634917/ |work=Healthcare Dive |date=October 25, 2022 |access-date=December 8, 2024}}</ref>

* '''August 29, 2022 – February 16, 2023:''' Approximately 50 mental health clinicians in Hawai'i conducted a 172-day strike, the longest mental health strike in U.S. history, to secure a first contract.<ref>{{cite web |title=Mental health therapists at Kaiser Permanente in Hawaii ratify contract, ending 172-day strike |url=https://nuhw.org/mental-health-therapists-at-kaiser-permanente-in-hawaii-ratify-contract-ending-172-day-strike/ |publisher=National Union of Healthcare Workers |date=February 16, 2023 |access-date=December 8, 2024}}</ref>

* '''October 21, 2024 – Present:''' Over 2,400 mental health professionals in Southern California began an open-ended strike focusing on staffing shortages and increased workloads.<ref>{{cite news |title=Kaiser mental health workers go on strike in Southern California over staffing, workloads |url=https://apnews.com/article/3b2347ba23ca5ba7fff0afafc314bb26 |work=Associated Press |date=October 21, 2024 |access-date=December 8, 2024}}</ref>

==== Alliance of Health Care Unions (AHCU) Strikes ====
* '''November 2021:''' Over 30,000 AHCU members planned a strike over staffing shortages and a proposed two-tier wage system. A tentative agreement was reached on November 13, 2021, averting the strike.<ref>{{cite web |title=Kaiser health care worker strike averted as tentative deal is reached |url=https://www.cbsnews.com/news/kaiser-permanente-union-nurses-health-care-workers-deal-reached-strike-averted/ |website=CBS News |date=November 13, 2021}}</ref>

==== Coalition of Kaiser Permanente Unions (CKPU) Strikes ====
* '''October 4–7, 2023:''' From October 4 to 7, 2023, approximately 75,000 healthcare workers conducted a three-day strike, making it the largest healthcare worker strike in U.S. history. The strike focused on staffing shortages and wage concerns. A tentative agreement was reached on October 13, 2023, setting minimum hourly wages at $25 in California and $23 in other states and providing a 21% wage increase over four years.<ref>{{cite web |title=Kaiser Permanente workers ratify contract after strike over wages and staffing levels |url=https://apnews.com/article/kaiser-permanente-health-care-workers-ratify-contract-ce2c3d5ee7554543956488c0372fa57b |website=AP News |date=November 9, 2023}}</ref>

==== Other Major Strikes ====
* '''2011–2012:''' KP's California operations experienced four labor strikes involving nurses, mental health providers, and other professionals. The NUHW accused Kaiser of stalling negotiations while profiting $2.1 billion in 2011 and paying its CEO George Halvorson $9 million annually.<ref name=granitebay>{{cite news| title=Kaiser workers on strike| url=http://www.thepresstribune.com/article/kaiser-workers-strike| work=Roseville Press-Tribune| date=January 31, 2012}}</ref>
* '''November 11, 2014:''' Approximately 18,000 nurses went on strike over Ebola safeguards and patient-care standards during union contract talks, affecting 21 hospitals and 35 clinics in Northern California.<ref>{{cite web|url=http://www.nbcbayarea.com/news/local/Kaiser-Nurses-to-Hold-2-Day-Strike-Over-Ebola-Protections-282214461.html|title=Kaiser Nurses Holding 2-Day Strike Over Staffing Levels, Ebola Protections|work=NBC Bay Area|date=November 11, 2014 }}</ref>
* '''October 2023:''' Approximately 75,000 healthcare workers went on a three-day strike, demanding higher pay and addressing staff shortages. A new four-year contract was ratified in November 2023.<ref>{{cite web |title=Kaiser healthcare workers ratify new contract |url=https://www.reuters.com/business/healthcare-pharmaceuticals/kaiser-healthcare-workers-ratify-new-contract-2023-11-09/ |website=Reuters.com}}</ref>

=== Regulatory Oversight ===
During the ongoing 2024 Southern California mental health strike, the California Department of Managed Healthcare (DMHC) began investigating Kaiser’s contingency plans to ensure compliance with patient care standards.<ref>{{cite web |title=Press Release: California Department of Managed Health Care Investigates Kaiser Permanente Strike Contingency Plan |url=https://www.dmhc.ca.gov/Resources/Newsroom/PressReleases/October21,2024.aspx |website=DMHC}}</ref>


===Cash reserves===
In 2002, ], president of the ] testified before the California Senate Committee on Health and Human Services that the pharmaceutical giant ] had paid Kaiser to compare the effects of two experimental vaccines on children in a way that manipulated test results.
Jamie Court, president of the ] has said that Kaiser's retained profits are evidence that Kaiser policies are overpriced and that health insurance regulation is needed.<ref>{{Cite web|url=https://www.eastbaytimes.com/2007/08/04/kaiser-reports-income-boost/|title=Kaiser reports income boost|date=August 4, 2007}}</ref>


State insurance regulations require that insurers maintain certain minimum amounts of ] to ensure that they are able to meet their obligations; the amount varies by insurer, based on its risk factors, such as its investments, how many people it insures, and other factors; a few states also have caps on how large the reserves can be.<ref name=DenverReserves/>
===Patient Dumping===
Kaiser and other hospitals as well as prisons and police in ] area has been accused of discharging indigent patients to ].<ref></ref> Kaiser has paid a for patient dumping.


Kaiser has been criticized by activists and state regulators for the size of its cash reserves. As of 2015, it had $21.7 billion in cash reserves, which was about 1,600% the amount required by California state regulations.<ref name=Mercury2014>Tracy Seipel for Mercury News. March 19, 2015 </ref> Its reserves had been a target of advertising by ] supporting Proposition 45 in ].<ref name=Mercury2014/> At the end of 2010 Kaiser held $666 million in reserves, which was about 1,300% of the minimum required under Colorado state law.<ref name=DenverReserves>Michael Booth for The Denver Post. March 13, 2011. </ref> Those funds were in Kaiser's risk-based capital account, held to pay for disasters or major projects.<ref name=DenverReserves/> In 2008, the Colorado regulator required Kaiser to spend down its reserves; after negotiations Kaiser agreed to spend $155 million of its reserves giving credits to its clients and building clinics in underserved parts of the state.<ref name=DenverReserves/>
===Kidney Transplantation===
Kaiser Northern California has been criticized for its mishandling of patients and organs available for ].<ref></ref> On May 13, 2006, Kaiser announced that it will discontinue its start-up kidney transplant program after less than two years of operation, due to administrative problems and failure to communicate with regulatory agencies that removed patients from the organ list. These administrative failures created undue delays for those awaiting kidney transplantation. During the transplant program's first year, 56 transplants were performed (with around 2000 people on the wait list) and twice that number of people died waiting for a kidney. At other California transplant centers more than twice as many people received kidneys than died during the same period. Kaiser suspended the program after being hit with a series of .


===COVID-19===
===Labor Management Partnership (LMP)===
Kaiser was cited by the ] twelve times and fined nearly $500,000 for violations early in the ] pertaining to staff safety following outbreaks of COVID in its hospitals across the state, particularly in the ]. Kaiser appealed the citations.<ref></ref> Kaiser was responsible for more than 10% of all COVID violations in California.<ref></ref> A COVID-19 outbreak sickened 92 people at ] on Christmas Day 2020.<ref>{{cite web |title=15 Kaiser San Jose patients test positive for coronavirus after Christmas Day outbreak |date=2021-01-14 |website=] |archive-url=https://web.archive.org/web/20230419132046/https://www.latimes.com/california/story/2021-01-13/kaiser-san-jose-patients-positive-covid19-christmas-day-outbreak |archive-date=2023-04-19 |url-status=live |url=https://www.latimes.com/california/story/2021-01-13/kaiser-san-jose-patients-positive-covid19-christmas-day-outbreak}}</ref><ref></ref> Kaiser San Leandro received the largest portion of fines, nearly $90k, for delays in reporting COVID infections and for failure to ration medical equipment according to pandemic regulations.<ref></ref>
Some Kaiser union members criticize Kaiser's Labor-Management Partnership (LMP) as an arrangement that's disadvantageous for workers. For instance, some members complain that union leaders bargain with management, and then present the outcome to workers as a non-negotiable ].


===Nonprofit Status=== ==See also==
{{Portal|Medicine}}
Critics have argued Kaiser should not have this legal status, because a significant portion of Kaiser's excess income is distributed to for-profit medical groups.
*]
*]


==References== ==References==
{{Reflist|30em}}
<div class="references-small">
<references/>
</div>


==External links== ==External links==
* {{commons category-inline}}
* - Official website
* {{Official website|https://healthy.kaiserpermanente.org/}}
* - The Kaiser Papers (personal accounts, news, etc.). Critical of Kaiser.
* , which represents the Permanente Medical Groups
* - Kaiser Papers Hawaii: Help for Kaiser Permanente Hawaii Members, member of ]. Critical of Kaiser.
* - "Kaiser Permanente bucks the HMO trend" * A project by OSHPD
* Report on successful Kaiser Permanente initiatives including declaration by Louise Liang falsely attributing Vioxx discovery to KP HealthConnect even though it was not yet in production use in Northern California
* - web site that offers criticism of Kaiser's Thrive campaign, member of ]. Critical of Kaiser.
* Home page of a group scrutinizing managed care and its failures, contains links to several pages about issues involving Kaiser Permanente
* - blog that examines allegations of Kaiser corruption and fraud. Critical of Kaiser.
* Transcripts of oral history interviews conducted by ] ] with KP executives, attorneys, and clinicians, including Keene and Trefethen.
* - anti-HMO organization. Critical of Kaiser.


{{Oakland, California|state=collapsed}}
{{California Trauma Centers}}
{{Kaiser Permanente}}
{{Henry J. Kaiser}}
{{Authority control}}


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Latest revision as of 12:53, 25 December 2024

American integrated managed care company

Kaiser Permanente
Headquarters (the Ordway Building) in downtown Oakland
Company typeConsortium of for-profit and not-for-profit entities.
IndustryHealthcare
FoundedJuly 21, 1945; 79 years ago (1945-07-21)
Founders
HeadquartersOrdway Building
Oakland, California, U.S.
Number of locations40 hospitals and 618 medical facilities (2022)
Area served
Key peopleGreg A. Adams (Chairman & CEO)
see section below
ServicesInsurance, Hospital, Healthcare
RevenueIncrease $100.8 billion USD (2023)
Operating incomeIncrease $329 million USD (2023)
Members12.5 million (2022)
Number of employees235,785 employees (including 73,618 nurses and 24,605 physicians as of 2023)
ParentKaiser Foundation Health Plan, Inc.
Subsidiaries
  • Geisinger Health System
  • The Permanente Federation, LLC
  • St Dominic's Hospital
  • The Permanente Medical Group, Inc.
  • Avivia Health
  • Buenaventura Medical Group Inc
  • Southern California Permanente Medical Group
  • 1800 Harrison Foundation
  • Kaiser Foundation Hospitals
  • The Southeast Permanente Medical Group, Inc.
  • Kaiser Permanente of Georgia, Inc.
  • Kaiser Permanente Center for Gun Violence Research and Education
Websitekaiserpermanente.org kp.org

Kaiser Permanente (/ˈkaɪzər pɜːrməˈnɛnteɪ/; KP) is an American integrated managed care consortium, based in Oakland, California, United States, founded in 1945 by industrialist Henry J. Kaiser and physician Sidney Garfield. Kaiser Permanente is made up of three distinct but interdependent groups of entities: the Kaiser Foundation Health Plan, Inc. (KFHP) and its regional operating subsidiaries; Kaiser Foundation Hospitals; and the regional Permanente Medical Groups. As of 2023, Kaiser Permanente operates in eight states (Hawaii, Washington, Oregon, California, Colorado, Maryland, Virginia, Georgia) and the District of Columbia, and is the largest managed care organization in the United States.

Kaiser Permanente operates 40 hospitals and more than 616 medical offices, with over 300,000 personnel, including more than 98,000 physicians and nurses.

Each Permanente Medical Group operates as a separate for-profit partnership or professional corporation in its individual territory, and while none publicly reports its financial results, each is primarily funded by reimbursements from its respective regional Kaiser Foundation Health Plan entity. KFHP is one of the largest not-for-profit organizations in the United States.

KP's quality of care has been highly rated and attributed to an emphasis on preventive care, its doctors being salaried rather than paid on a fee-for-service basis, and an attempt to minimize the time patients spend in high-cost hospitals by carefully planning their stay. However, Kaiser has had disputes with its employees' unions; repeatedly faced civil and criminal charges for falsification of records and patient dumping; faced action by regulators over the quality of care it provided, especially to patients with mental health issues; and faced criticism from activists and action from regulators over the size of its cash reserves.

Structure and governance

Kaiser Permanente provides care throughout eight regions in the United States. Two or three (four, in the case of California) distinct but interdependent legal entities form the Kaiser system within each region. This structure was adopted by Kaiser Permanente physicians and leaders in 1955.

Governance

Each entity of Kaiser Permanente has its own management and governance structure, although all of the structures are interdependent and cooperative to a great extent. There are multiple affiliated nonprofits registered with the U.S. Internal Revenue Service. According to Form 990 governance questions, Kaiser Foundation Hospitals and Kaiser Foundation Health Plan do not have members with the power to appoint or elect board members, meaning that the board itself nominates and appoints new members.

James A. Vohs was appointed CEO in 1978 and chairman in 1980, and he would serve until his retirement in 1992. He was the first chairman to not be a member of the Kaiser family.

David M. Lawrence served as chairman and CEO until his retirement in 2002.

George Halvorson became the chairman and CEO until his retirement in December 2013.

On November 5, 2012, the board of directors announced that Bernard J. Tyson, Kaiser's president and chief operating officer for the last two years, would replace Halvorson, marking the first time an African American was appointed as chairman. Tyson died in November 2019. Greg A. Adams assumed the role of chairman and CEO in December 2019.

Operations

As of 2022, Kaiser Permanente had 12.6 million health plan members, 216,776 employees, 23,597 physicians, 63,847 nurses, 39 medical centers, and 724 medical facilities. As of December 31, 2022, the nonprofit Kaiser Foundation Health Plan and Kaiser Foundation Hospitals entities reported an operating loss of $1.3 billion in net income on $95.4 billion in operating revenues.

The two types of organizations which make up each regional entity are:

  • Kaiser Foundation Health Plans (KFHP) work with employers, employees, and individual members to offer prepaid health plans and insurance. The health plans are not-for-profit and provide infrastructure for and invest in Kaiser Foundation Hospitals and provide a tax-exempt shelter for the for-profit medical groups.
  • Permanente Medical Groups are physician-owned organizations, which provide and arrange for medical care for Kaiser Foundation Health Plan members in each respective region. The medical groups are for-profit partnerships or professional corporations and receive nearly all of their funding from Kaiser Foundation Health Plans. The first medical group, The Permanente Medical Group (TPMG), formed in 1948 in Northern California, is one of the largest doctors groups in the United States with 11,225 medical professionals and 186 locations at the beginning of 2023. Permanente physicians become stockholders in TPMG after three years at the company.

In addition, Kaiser Foundation Hospitals (despite the plural name, a single legal entity) operates medical centers in California, Oregon, and Hawaii, and outpatient facilities in the remaining Kaiser Permanente regions. The hospital foundation entity is not-for-profit and relies on the Kaiser Foundation Health Plans for funding. It also provides infrastructure and facilities that benefit the for-profit medical groups.

Regional entities

Kaiser Permanente is administered through eight regions, including one parent and six subordinate health plan entities, one hospital entity, and nine separate, affiliated medical groups:

Various legal entities serve the areas of the US where Kaiser operates: California (the largest two), Colorado, Georgia, Hawaii, mid-Atlantic, Pacific Northwest, and Washington.
  • Northern California, 3,351,449 members
    • Kaiser Foundation Health Plan, Inc. (KFHP)
    • Kaiser Foundation Hospitals (KFH)
    • The Permanente Medical Group, Inc. (TPMG)
  • Southern California, 3,499,035 members
    • Kaiser Foundation Health Plan, Inc. (KFHP)
    • Kaiser Foundation Hospitals (KFH)
    • Southern California Permanente Medical Group (SCPMG)
  • Colorado, 531,908 members
    • Kaiser Foundation Health Plan of Colorado (KFHPCO)
    • Colorado Permanente Medical Group, P.C. (CPMG)
  • Georgia, 222,074 members
    • Kaiser Foundation Health Plan of Georgia, Inc. (KFHPGA)
    • The Southeast Permanente Medical Group, Inc. (TSPMG)
  • Hawaii, 226,900 members
    • Kaiser Foundation Health Plan, Inc. (KFHP)
    • Kaiser Foundation Hospitals (KFH)
    • Hawaii Permanente Medical Group, Inc. (HPMG)
  • Mid-Atlantic (vicinity of Washington, D.C., including Maryland and Virginia), 581,000 members
    • Kaiser Foundation Health Plan of the Mid-Atlantic States Inc. (KFHPMA)
    • Mid-Atlantic Permanente Medical Group, P.C. (MAPMG)
  • Northwest (Northwest Oregon and Southwest Washington), 480,386 members
    • Kaiser Foundation Health Plan of the Northwest (KFHPNW)
    • Kaiser Foundation Hospitals (KFH)
    • Northwest Permanente, P.C. Physicians and Surgeons (NWP)
  • Washington (except Southwest Washington), 681,386 members

In addition to the regional entities, in 1997, the then-twelve Permanente Medical Groups created The Permanente Federation LLC, a separate entity, which focuses on standardizing patient care and performance under one name and system of policies. Around the same time, The Permanente Company was also chartered as a vehicle to provide investment opportunities for the for-profit Permanente Medical Groups. One of the ventures of the Permanente Company is Kaiser Permanente Ventures, a venture capital firm that invests in emerging medical technologies.

One of Kaiser's six other office buildings in Oakland

Lobbying entity

A mutual benefit corporation named "Kaiser Foundation for the Advancement of Integrated Health Care" was established on December 27, 2017. The specific purpose of the corporation is "to advocate for and promote the integrated models of health care". The corporation's founder, Maryann Bodayle, has served as the "Governance Administrator" of Kaiser Foundation Health Plan, Inc. since 2013.

History

Kaiser Sunset Hospital complex in Los Angeles, California

Early years

The history of Kaiser Permanente dates to 1933 and a tiny hospital in the town of Desert Center, California. At that time, Henry J. Kaiser and several other large construction contractors had formed an insurance consortium called Industrial Indemnity to meet their workers' compensation obligations. Sidney Garfield had just finished his residency at Los Angeles County-USC Medical Center at a time when jobs were scarce; he was able to secure a contract with Industrial Indemnity to care for 5,000 construction workers building the Colorado River Aqueduct in the Mojave Desert. Soon enough, Garfield's new hospital was in a precarious financial state (with mounting debt and the staff of three going unpaid), due in part to Garfield's desire to treat all patients regardless of ability to pay, as well as his insistence on equipping the hospital adequately so that critically injured patients could be stabilized for the long journey to full-service hospitals in Los Angeles.

However, Garfield won over two Industrial Indemnity executives, Harold Hatch and Alonzo B. Ordway. It was Hatch who proposed to Garfield the specific solution that would lead to the creation of Kaiser Permanente: Industrial Indemnity would prepay 17.5% of premiums, or $1.50 per worker per month, to cover work-related injuries, while the workers would each contribute five cents per day to cover non-work-related injuries. Later, Garfield also credited Ordway with coming up with the general idea of prepayment for industrial health care and explained that he did not know much at the time about other similar health plans except for the Ross-Loos Medical Group.

Hatch's solution enabled Garfield to bring his budget back into the positive, and to experiment with providing a broader range of services to the workers besides pure emergency care. By the time work on the aqueduct concluded and the project was wrapped up, Garfield had paid off all of his debts, was supervising ten physicians at three hospitals, and controlled a financial reserve of $150,000.

Garfield returned to Los Angeles for further study at County-USC with the intent of entering private practice. However, in March 1938, Consolidated Industries (a consortium led by the Kaiser Company) initiated work on a contract for the upper half of the Grand Coulee Dam in Washington state, and took over responsibility for the thousands of workers who had worked for a different construction consortium on the first half of the dam. Edgar Kaiser, Henry's son, was in charge of the project. To smooth over relations with the workers (who had been treated poorly by their earlier employer), Hatch and Ordway persuaded Edgar to meet with Garfield, and in turn Edgar persuaded Garfield to tour the Grand Coulee site. Garfield subsequently agreed to reproduce at Grand Coulee Dam what he had done on the Colorado River Aqueduct project. He immediately spent $100,000 on renovating the decrepit Mason City Hospital and hired seven physicians.

Unlike the workers on Garfield's first project, many workers at Grand Coulee Dam had brought dependents with them. The unions soon forced the Kaiser Company to expand its plan to cover dependents, which resulted in a dramatic shift from industrial medicine into family practice and enabled Garfield to formulate some of the basic principles of Kaiser Permanente. It was also during this time that Henry Kaiser personally became acquainted with Garfield and forged a friendship which lasted until Kaiser's death.

World War II

Kaiser Field Hospital in Richmond, California. Defunct since 1995

In 1939, the Kaiser Company began work on several huge shipbuilding contracts in Oakland, and by the end of 1941 would control four major shipyards on the West Coast. During 1940, the expansion of the American defense-industrial complex in preparation for entrance into World War II resulted in a massive increase in the number of employees at the Richmond shipyard. In January 1941, Henry Kaiser asked Garfield to set up an insurance plan for the Richmond workers (this was merely contract negotiation with insurance companies), and a year later Kaiser asked Garfield to duplicate at Richmond what he had done at Desert Center and Mason City. Unlike the two other projects, the resulting entity lived on after the construction project that gave birth to it, and it is the direct ancestor of today's Kaiser Permanente.

On March 1, 1942, Sidney R. Garfield & Associates opened its offices in Oakland to provide care to 20,000 workers, followed by the opening of the Permanente Health Plan on June 1. From the beginning, Kaiser Permanente strongly supported preventive medicine and attempted to educate its members about maintaining their own health.

In July, the Permanente Foundation formed to operate Northern California hospitals that would be linked to the outpatient health plans, followed shortly thereafter by the creation of Northern Permanente Foundation for Oregon and Washington and Southern Permanente Foundation for California. The name Permanente came from Permanente Creek, which flowed past Henry Kaiser's Kaiser Permanente Cement Plant on Black Mountain in Cupertino, California. Kaiser's first wife, Bess Fosburgh, liked the name. An abandoned Oakland facility was modernized as the 170-bed Permanente Hospital opened on August 1, 1942 (this facility evolved over the decades into today's flagship Kaiser Oakland Medical Center). Three weeks later, the 71-bed Richmond Field Hospital opened. Six first aid stations were set up in the shipyards to treat industrial accidents and minor illness. Each first aid station had an ambulance ready to rush patients to the surgical field hospital if required. Stabilized patients could be moved to the larger hospital for recuperative care. The Northern Permanente Hospital opened two weeks later to serve workers at the Kaiser shipyard in Vancouver, Washington. Shipyard workers paid seven cents per day for comprehensive health care coverage, and within a year, the shipyard health plan employed sixty physicians with salaries between $450 and $1,000 per month. These physicians established California Physicians Service to offer similar health coverage to the families of shipyard workers. In 1944, Kaiser decided to continue the program after the war and to open it up to the general public.

Meanwhile, during the war years, the American Medical Association (AMA) (which opposed managed care organizations from their very beginning) tried to defuse demand for managed care by promoting the rapid expansion of the Blue Cross and Blue Shield preferred provider organization networks.

Courage to Heal, a novel by KP Historical Society President and Medical Director Emeritus of KP San Diego Paul Bernstein, MD, is based on the story of Garfield's life, his struggles with the AMA, and the origins of Kaiser Permanente.

Postwar growth

In 1943, Henry J. Kaiser and Dr. Sidney R. Garfield opened a 50-bed hospital, housing six physicians for the 3000 employees and their families at the new Kaiser Steel Mill in Fontana, California, offering a pre-paid health care plan for $0.60/week for adults, and $0.30/week for children. In 1945, the Kaiser Permanente health plan was opened to the public.

In 1948, Kaiser established the Henry J. Kaiser Family Foundation (also known as Kaiser Family Foundation), a U.S.-based nonprofit, private operating foundation focusing on the major health care issues facing the nation. The Foundation, not associated with Kaiser Permanente or Kaiser Industries, is an independent voice and source of facts and analysis for policymakers, the media, the health care community, and the general public.

The end of World War II brought about a huge plunge in Kaiser Permanente membership; for example, 50,000 workers had left the Northern California yards by July 1945. Membership bottomed out at 17,000 for the entire system but then surged back to 26,000 within six months as Garfield aggressively marketed his plan to the public. Sidney Garfield & Associates had been a sole proprietorship, but in 1948, it was reorganized into a partnership, Permanente Medical Group.

During this period, a substantial amount of growth came from union members; the unions saw Kaiser Permanente care as more affordable and comprehensive than what was available at the time from private physicians under the fee-for-service system. For example, Fortune magazine had reported in 1944 that 90% of the U.S. population could not afford fee-for-service health care. Kaiser Permanente membership soared to 154,000 in 1950, 283,000 in 1952, 470,000 in 1954, 556,000 in 1956, and 618,000 in 1958.

From 1944 onward, both Kaiser Permanente and Garfield fought off numerous attacks from the AMA and various state and local medical societies. Henry Kaiser came to the defense of both Garfield and the health plans he had created.

In 1951, the organization acquired its current name when Henry Kaiser unilaterally directed the trustees of the health plans, hospital foundations, and medical groups to add his name before Permanente. However, the physicians in the Permanente Medical Group were proud professionals who deeply resented the implication that they were directly controlled by Kaiser, and successfully forced him to back off with respect to their part of the organization. That same year, Kaiser Permanente also began experiments with large-scale multiphasic screening to identify unknown conditions and to facilitate treatment of known ones. Simultaneously, although no one questioned his medical competence, Garfield's deficiencies as an executive were becoming apparent as the organization expanded far beyond his ability to manage it properly.

With his wartime glory receding into history, Henry Kaiser became fascinated with the health care system created for him by Garfield and began to directly manage Kaiser Permanente and Garfield. This resulted in a financial disaster when Kaiser splurged on the new Walnut Creek hospital; his constant intermeddling led to significant friction at every level of the organization. The situation was not helped by Kaiser's marriage to Garfield's head administrative nurse (who had helped care for Kaiser's first wife on her deathbed), convincing Garfield to marry the sister of that nurse, and then having Garfield move in next door to him. Clifford Keene (who would eventually serve as president of Kaiser Permanente) later recalled that this arrangement resulted in a rather dysfunctional and combative family in charge of Kaiser Permanente.

Keene was an experienced Permanente physician whom Garfield had personally hired in 1946. During 1953 he had been trying to get a job at U.S. Steel, but on the morning of December 5, 1953, with internal tensions worsening day by day, Garfield met with Keene at the Mark Hopkins Hotel in San Francisco and asked him to turn around the organization. It took Keene 15 years to realize that Kaiser had forced Garfield to ask Keene to become his replacement. Due to the chaos on the board, Keene at first took control with the vague title of Executive Associate, but it soon became clear to everyone that he was actually in charge and Garfield was to become a lobbyist and "ambassador" for the HMO concept.

However, even with Garfield relieved of day-to-day management duties, the underlying problem of Henry Kaiser's authoritarian management style continued to persist. After several tense confrontations between Kaiser and Permanente Medical Group physicians, the doctors met with Kaiser's top adviser, Eugene Trefethen, at Kaiser's personal estate near Lake Tahoe on July 12, 1955. Trefethen came up with the idea of a contract between the medical groups and the health plans and hospital foundations that would set out roles, responsibilities, and financial distribution. Trefethen, already a successful attorney, went on to a successful career with Kaiser Permanente and in retirement became a famous vintner.

While Keene and Trefethen struggled to fix the damage from Kaiser's micromanagement and Garfield's ineffectual management, Henry Kaiser moved to Oahu in 1956 and insisted on expanding Kaiser Permanente into Hawaii in 1958. He quickly ruined what should have been a simple project, and only a last-minute intervention by Keene and Trefethen in August 1960 prevented the total disintegration of the Hawaii organization. By that year, Kaiser membership had grown to 808,000.

Managed care era

Having overseen Kaiser Permanente's successful transformation from Henry Kaiser's health care experiment into a large-scale self-sustaining enterprise, Keene retired in 1975. By 1976, membership reached three million. In 1977, all six of Kaiser Permanente's regions had become federally qualified health maintenance organizations.

In 1980, Kaiser acquired a nonprofit group practice to create its Mid-Atlantic region, encompassing the District of Columbia, Maryland, and Virginia. In 1985, Kaiser Permanente expanded to Georgia.

Regional evolution

By 1990, Kaiser Permanente provided coverage for about a third of the population of the cities of San Francisco and Oakland; total Northern California membership was over 2.4 million.

Elsewhere, Kaiser Permanente did not do as well, and its geographic footprint changed significantly in the 1990s. The organization spun off or closed outposts in Texas, North Carolina, and the Northeast. In 1998, Kaiser Permanente sold its Texas operations, where reported problems had become so severe that the organization directed its lawyers to attempt to block the release of a Texas Department of Insurance report. This prompted the state attorney general to threaten to revoke the organization's license. Kaiser Permanente closed health plans in Charlotte and Raleigh-Durham in North Carolina four years later. The organization also sold its unprofitable Northeast division in 2000. The Ohio division was sold to Catholic Health Partners in 2013.

In 1995, Kaiser Permanente celebrated its fiftieth anniversary as a public health plan. Two years later, national membership reached nine million. In 1997, the organization established an agreement with the AFL-CIO to explore a new approach to the relationship between management and labor, known as the Labor Management Partnership. Going into the new millennium, competition in the managed care market increased dramatically, raising new concerns. The Southern California Permanente Medical Group saw declining rates of new members as other managed care groups flourished.

In 2017, Kaiser acquired Group Health Cooperative, which serves clients in the state of Washington outside of Southwest Washington. Group Health was started in part from funds from longshoremen in Washington state, who were left out when Kaiser chose not to expand north of the Portland area.

On April 26, 2023, Kaiser announced it would acquire Geisinger Health System. As part of the deal, Geisinger would operate as an independent subsidiary, folded into a new non-profit group called Risant Health. On June 21, 2024, it was announced that Risant Health would acquire Cone Health, a hospital system based in Greensboro, North Carolina.

KP HealthConnect

In 2002, Kaiser Permanente abandoned its attempt to build its own clinical information system with IBM, writing off some $452 million in software assets. This information technology failure led to major changes in the organization's approach to digital records. Under George Halvorson's direction, Kaiser looked closely at two medical software vendors, Cerner and Epic Systems, ultimately selecting Epic as the primary vendor for a new system, branded KP HealthConnect. Although Kaiser's approach shifted to "buy, not build," the project was unprecedented for a civilian system in size and scope. Deployed across all eight regions over six years and at a cost of more than $6 billion, by 2010, it was the largest civilian electronic medical record system, serving more than 8.6 million Kaiser Permanente members, implemented at a cost exceeding a half million dollars per physician. As of 2020 KP HealthConnect supports 12.2 million members.

International reputation

Early in the 21st century, the NHS and UK Department of Health became impressed with some aspects of the Kaiser operation and initiated a series of studies involving several health care organizations in England. Visits occurred and suggestions of adopting some KP policies are currently active. The management of hospital bed-occupancy by KP, by means of integrated management in and out of hospital and monitoring progress against care pathways has given rise to trials of similar techniques in eight areas of the UK.

In 2002, a controversial study by California-based academics published in the British Medical Journal compared Kaiser to the British National Health Service, finding Kaiser to be superior in several respects. Subsequently, a group of health policy academics who were experts on the NHS published a competing analysis claiming that Kaiser's costs were actually substantially higher than the NHS and for a younger and healthier population.

2023 strike

From October 4 to 7, 2023, more than 75,000 Kaiser Permanente workers went on strike. This has been regarded as the largest health care worker strike in U.S. history. A new four-year contract would later be ratified by 98.5% of the 85,000 members of the Coalition of Kaiser Permanente Unions on November 9, 2023.

Quality of care

In the California Healthcare Quality Report Card 2013 Edition, Kaiser Permanente's Northern California and Southern California regions, KP received four out of four possible stars in Meeting National Standards of Care. KP North and South also received three out of four stars in Members Rate Their HMO. KP's performance has been attributed to three practices: First, KP places a strong emphasis on preventive care, reducing costs later on. Second, its doctors are salaried rather than paid per service, which removes the main incentive for doctors to perform unnecessary procedures. Thirdly, KP attempts to minimize the time patients spend in high-cost hospitals by carefully planning their stay and by shifting care to outpatient clinics. This practice results in lower costs per member, cost savings for KP and greater doctor attention to patients. A comparison to the UK's National Health Service found that patients spend 2–5 times as much time in NHS hospitals as compared to KP hospitals.

In June 2013, the California Department of Managed Health Care (DMHC) levied a $4 million fine, the second largest in the agency's history, against Kaiser for not providing adequate mental health care to its patients. Alleged violations of California's timely access laws included failures to accurately track wait times and track doctor availability amid evidence of inconsistent electronic and paper records. It was also found by the DMHC that patients received written materials circulated by Kaiser dissuading them from seeking care, a violation of state and federal laws. DMHC also issued a cease and desist order for Kaiser to end the practices. DMHC conducted a follow-up investigation which published in April 2015. The report found Kaiser had put systems in place to better track how patients were being cared for but still had not addressed problems with actually providing mental health care that complied with state and federal laws. Kaiser's challenges on this front were exacerbated by a long, unresolved labor dispute with the union representing therapists.

Kaiser appealed the findings, the order, and the fine, and sought to keep the proceedings closed, but in September 2014, in the face of the administrative judge's order to keep the proceedings open, and facing the beginning of public testimony, Kaiser withdrew the appeal and paid the $4 million. It also issued a statement which denied much of the wrongdoing. Kaiser faces ongoing inspections by DMHC and three class-action lawsuits related to the issues identified by the DMHC.

Research and publishing

Kaiser operates a Division of Research, which annually conducts between 200 and 300 studies, and the Center for Health Research, which in 2009 had more than 300 active studies. Kaiser's bias toward prevention is reflected in the areas of interest—vaccine and genetic studies are prominent. The work is funded primarily by federal, state, and other outside (non-Kaiser) institutions.

Kaiser has created and operates a voluntary biobank of donated blood samples from members along with their medical record and the responses to a lifestyle and health survey. As of November 2018, the Kaiser Permanente Research Bank had over 300,000 samples, with a goal of 500,000. De-identified data is shared with both Kaiser researchers and researchers from other institutions.

Kaiser Permanente Bernard J. Tyson School of Medicine

Main article: Kaiser Permanente Bernard J. Tyson School of Medicine

Kaiser Permanente announced its plan to start a medical school in December, 2015, and the school welcomed its inaugural class in June, 2020. The vision for the school is to redesign physician education around the pillars of patient-centered care, population health, quality improvement, team-based care, and health equity.

Mark Schuster was named the medical school's Founding Dean and CEO in 2017. The Kaiser Permanente Bernard J. Tyson School of Medicine was renamed from the Kaiser Permanente School of Medicine in November 2019 in honor of late Kaiser Permanente Chairman and CEO Bernard J. Tyson. The medical school received preliminary LCME accreditation in February 2019 and received full LCME accreditation in June 2024. The school will waive all tuition for the full four years of medical school for its first five classes.   

Controversies

Patient dumping

In 2006 Kaiser settled five cases for alleged patient dumping—the delivery of homeless hospitalized patients to other agencies or organizations in order to avoid expensive medical care—between 2002 and 2005. Los Angeles city officials had filed civil and criminal legal action against Kaiser Permanente for patient dumping, which was the first action of its kind that the city had taken. The city's decision to charge Kaiser Permanente reportedly was influenced by security camera footage, allegedly showing a 63-year-old patient, dressed in hospital gown and slippers, wandering toward a mission on Skid Row (this footage was prominently featured in the Michael Moore 2007 documentary Sicko). At the time that the complaint was filed, city officials said that 10 other hospitals were under investigation for similar issues. Kaiser settled the case, paying $5,000 in civil penalties and agreeing to spend $500,000 on services for the homeless. During that same period, the Department of Health and Human Services' Office of the Inspector General settled 102 cases against U.S. hospitals that resulted in a monetary payment to the agency.

Organ transplant program

In 2004, Northern California Kaiser Permanente initiated an in-house program for kidney transplantation. Prior to opening the transplant center, Northern California Kaiser patients would generally receive transplants at medical centers associated with the University of California (UC San Francisco and UC Davis). Upon opening the transplant center, Kaiser required that members who are transplant candidates in Northern California obtain services exclusively through its internal KP-owned transplant center.

While it was in operation, the Kaiser program had a 100% survival rate, which is better than other transplant centers. However, patients who needed a kidney were less likely to be offered one. Northern California Kaiser performed 56 transplants in 2005, and twice that many patients died while waiting for a kidney. At other California transplant centers, more than twice as many people received kidneys than died during the same period. Unlike other centers, the Kaiser program did not perform riskier transplants or use donated organs from elderly or other higher-risk people, which have worse outcomes. Northern California Kaiser closed the kidney transplant program in May 2006. As before, Northern California Kaiser now pays for pre-transplant care and transplants at other hospitals. This change affected approximately 2,000 patients.

Mandatory arbitration

Kaiser requires an agreement by planholders to submit patient malpractice claims to arbitration rather than litigating through the court system. This has triggered some opposition.

Labor unions

While Doctors of Medicine (M.D.) and Doctors of Osteopathic Medicine (D.O.) are partners within the for-profit physician groups, many employees are members of various unions and guilds, depending on their role and service area.

KP's California operations were subject to four labor strikes in 2011 and 2012, involving nurses, mental health providers, and other professionals. The National Union of Healthcare Workers (NUHW) accused Kaiser of deliberately stalling negotiations while profiting $2.1 billion in 2011 and paying its CEO George Halvorson $9 million annually. The workers were dissatisfied with proposed changes to pensions and other benefits.

On November 11, 2014, an estimated 18,000 nurses went on strike at KP hospitals in Northern California over Ebola safeguards and patient-care standards during union contract talks. 21 hospitals and 35 clinics in the San Francisco Bay Area were affected.

In October 2023, as many as 75,000 Kaiser healthcare workers went on a three-day strike at KP hospitals and clinics. The Union had accused Kaiser of failing to address critical staff shortages, and demanded higher pay for staff. In November 2023 the workers voted to ratify a new four-year contract that addressed the demands.

On October 21, 2024, 2,400 Kaiser Permanente Southern California mental health therapists, psychologists, and psychiatric nurses went on strike for equity. The National Union of Healthcare Workers members are striking for adequate staffing and time to complete all patient care tasks, pay increases that are equitable to other Kaiser employees and that keep up with inflation, and the restoration of pension benefits to match what 95% or more Kaiser employees are already receiving. This strike is ongoing as of 12/25/2024.

The California Department of Managed Healthcare (DMHC) has begun investigating Kaiser's contingency plan during the strike. Kaiser reports that they have comprehensive plans to ensure patient access to care, and this is currently being closely monitored by the DMHC.

Strikes and Labor Disputes

Kaiser Permanente has experienced numerous labor disputes and strikes across its history, often centered on staffing levels, wages, and working conditions. These disputes have involved several unions, including the National Union of Healthcare Workers (NUHW), the Alliance of Health Care Unions (AHCU), and the Coalition of Kaiser Permanente Unions (CKPU). Below is a comprehensive account of major strikes involving these unions.

National Union of Healthcare Workers (NUHW) Strikes

The National Union of Healthcare Workers (NUHW) has led several significant strikes involving Kaiser Permanente employees. These strikes often focused on issues such as staffing shortages, patient care, and working conditions.

  • January 12–16, 2015: Approximately 2,600 mental health clinicians and 700 optical workers in California conducted a five-day strike to protest staffing shortages and patient care issues.
  • December 10–14, 2018: Approximately 4,000 mental health clinicians and other healthcare professionals in California participated in a five-day strike advocating for improved patient care and working conditions.
  • March 18–22, 2019: NUHW-represented mental health clinicians conducted a five-day strike addressing issues related to patient care and staffing.
  • November 11–15, 2019: Mental health clinicians and healthcare professionals held a five-day strike to protest staffing shortages and advocate for better patient care.
  • August 15 – October 18, 2022: Nearly 2,000 mental health therapists in Northern California engaged in a 10-week strike, concluding with a tentative agreement addressing patient care and staffing concerns.
  • August 29, 2022 – February 16, 2023: Approximately 50 mental health clinicians in Hawai'i conducted a 172-day strike, the longest mental health strike in U.S. history, to secure a first contract.
  • October 21, 2024 – Present: Over 2,400 mental health professionals in Southern California began an open-ended strike focusing on staffing shortages and increased workloads.

Alliance of Health Care Unions (AHCU) Strikes

  • November 2021: Over 30,000 AHCU members planned a strike over staffing shortages and a proposed two-tier wage system. A tentative agreement was reached on November 13, 2021, averting the strike.

Coalition of Kaiser Permanente Unions (CKPU) Strikes

  • October 4–7, 2023: From October 4 to 7, 2023, approximately 75,000 healthcare workers conducted a three-day strike, making it the largest healthcare worker strike in U.S. history. The strike focused on staffing shortages and wage concerns. A tentative agreement was reached on October 13, 2023, setting minimum hourly wages at $25 in California and $23 in other states and providing a 21% wage increase over four years.

Other Major Strikes

  • 2011–2012: KP's California operations experienced four labor strikes involving nurses, mental health providers, and other professionals. The NUHW accused Kaiser of stalling negotiations while profiting $2.1 billion in 2011 and paying its CEO George Halvorson $9 million annually.
  • November 11, 2014: Approximately 18,000 nurses went on strike over Ebola safeguards and patient-care standards during union contract talks, affecting 21 hospitals and 35 clinics in Northern California.
  • October 2023: Approximately 75,000 healthcare workers went on a three-day strike, demanding higher pay and addressing staff shortages. A new four-year contract was ratified in November 2023.

Regulatory Oversight

During the ongoing 2024 Southern California mental health strike, the California Department of Managed Healthcare (DMHC) began investigating Kaiser’s contingency plans to ensure compliance with patient care standards.

Cash reserves

Jamie Court, president of the Foundation for Taxpayer and Consumer Rights has said that Kaiser's retained profits are evidence that Kaiser policies are overpriced and that health insurance regulation is needed.

State insurance regulations require that insurers maintain certain minimum amounts of cash reserves to ensure that they are able to meet their obligations; the amount varies by insurer, based on its risk factors, such as its investments, how many people it insures, and other factors; a few states also have caps on how large the reserves can be.

Kaiser has been criticized by activists and state regulators for the size of its cash reserves. As of 2015, it had $21.7 billion in cash reserves, which was about 1,600% the amount required by California state regulations. Its reserves had been a target of advertising by Consumer Watchdog supporting Proposition 45 in California's 2014 elections. At the end of 2010 Kaiser held $666 million in reserves, which was about 1,300% of the minimum required under Colorado state law. Those funds were in Kaiser's risk-based capital account, held to pay for disasters or major projects. In 2008, the Colorado regulator required Kaiser to spend down its reserves; after negotiations Kaiser agreed to spend $155 million of its reserves giving credits to its clients and building clinics in underserved parts of the state.

COVID-19

Kaiser was cited by the California Division of Occupational Safety and Health twelve times and fined nearly $500,000 for violations early in the COVID-19 pandemic pertaining to staff safety following outbreaks of COVID in its hospitals across the state, particularly in the Bay Area. Kaiser appealed the citations. Kaiser was responsible for more than 10% of all COVID violations in California. A COVID-19 outbreak sickened 92 people at Kaiser San Jose Medical Center on Christmas Day 2020. Kaiser San Leandro received the largest portion of fines, nearly $90k, for delays in reporting COVID infections and for failure to ration medical equipment according to pandemic regulations.

See also

References

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