Our model

Integrated care and coverage enable high-quality, connected, expert care.

Our model

Integrated care and coverage enable high-quality, connected, expert care.

Kaiser Permanente is one of America’s leading health care providers and nonprofit health plans. Our health plan finances the care delivered by the Permanente Medical Groups and our more than 23,000 physicians, 63,000 nurses, and 75,000 allied health professionals in our 39 hospitals and 719 medical facilities. We serve 12.4 million people in California, Colorado, the District of Columbia, Georgia, Hawaii, Maryland, Oregon, Virginia, and Washington.

Our business model combines all major parts of health coverage and care delivery into one coordinated experience. Unlike an insurance company, we are a membership based, prepaid, direct health care system. That means our members — whether they come to us through employer-sponsored or individual coverage, Medicare, or Medicaid — pay dues to access care and services that are coordinated across inpatient and outpatient settings, pharmacy, lab, imaging, and other ancillary services.

Our health care delivery system is accountable both to provide the most appropriate and necessary care to each individual and to serve as a steward of resources on behalf of our entire enrolled membership. This aligns incentives to promote keeping people healthy, rather than seeking to generate revenues when they are sick. 

Our model is different from how health care often works in America. This brief video provides the basics. 

Why Kaiser Permanente’s care and coverage model works

  • Provides population-wide management and financing through our prepaid health plan
  • Focuses on quality of care, not volume of services provided
  • Rewards high-value care and quality outcomes
  • Aligns incentives to keep costs reasonable
  • Invests in new technologies and innovations to advance quality of care
  • Addresses the social, environmental, and economic drivers of health in the communities we serve

Our approach enables us to hire and retain highly sought-after physicians and other medical personnel with a financial model that encourages them to provide the most effective care. This eliminates the pressures that can come from having to manage a business that is based on the volume of services they are able to provide. Instead, Kaiser Permanente’s physicians are salaried and utilize an evidence-based approach to the practice of medicine, which leads to better health outcomes and more effective and efficient care for our members.

Our integrated approach to providing physician-led health care and prepaid financing of coverage drives coordination of care across all settings and care teams. This enables quality outcomes by ensuring that our members receive the right care, at the right time, in the right setting, avoiding unnecessary costs by eliminating care complications and unnecessary or duplicate tests or procedures that occur when care is not coordinated. This is a significant factor in keeping our operating costs reasonable.

Our business model enables us to reinvest a significant amount of our operating revenue to continually advance the quality of care we provide. An example is pioneering electronic medical records in the 1960s and now using the power of that technology to innovate care through population health studies. Kaiser Permanente is also at the forefront in the use of telemedicine to provide care to our members. We provide convenient options including email, video, and phone consultations to move care whenever possible into less-expensive settings.

Kaiser Permanente’s model of a nonprofit health plan and hospital system integrated with a prepaid multispecialty medical group is recognized for the outcomes it achieves in pursuit of its mission: to provide high-quality, affordable health care services and to improve the health of the communities we serve. We also invest significantly in the geographies in which we operate by supporting community organizations and providing community and social health resources that contribute to creating some of the healthiest communities in the nation.