KPS reports first profits in four years
June 11, 2008 · Updated 10:56 AM
"After a long time of seeing red, Kitsap Physicians Service is now starting to see some black.The troubled health insurance provider reported profits at the close of the first quarter this year, the first it has seen in four years.It's a unique situation because there was a lot of community support behind them, said Jim Stevenson, public affairs director for the Office of the Insurance Commissioner.The OIC placed KPS in receivership on Aug. 2, 1999, assuming control of operations of the insurance provider. Since then, KPS started a belt-tightening campaign to increase its solvency. Layoffs and attrition have helped cut its workforce from 200 to 85. KPS had promised leaving employees they would have the first opportunity to come back if KPS rehires. KPS also discontinued participation in all state-sponsored plans, a liability Stevenson said KPS had to get rid of.The biggest drain was the company's decision to invest in large state contracts, Stevenson said. There has been this misconception the past 10 years that the bigger you get, the better. That's not always true.In a statement released May 25 to area newspapers, KPS President Elizabeth Gilje said the company has total revenues of $18.7 million for the quarter and a net operating income of $140,000. It's a strong start, Gilje said. This is concrete evidence that we are on the right track and that KPS Health Plans' rehabilitation plan is proceeding in a strategic path that aims to build success on success.KPS also announced that David Peel, the former chief financial officer of the First Choice Health Network Inc., has been named vice president of finance at KPS. Although the profits are a good sign, OIC's Stevenson said he remains cautious. Receivership is a long-term proposition, Stevenson said. There is obviously a long way to go."