The American Medical Association's physician practice services subsidiary is making a push to offer financial services to member physicians.
AMA Solutions has deals in the works with lender AT&T Capital Corp. and mutual fund manager Scudder, Stevens & Clark that would enable the for-profit subsidiary to market its services in exchange for reduced fees and other perks reserved for AMA member physicians.
AMA Solutions already markets AT&T Capital's equipment leasing programs. The new proposal is concentrated on AT&T Capital's $250 million-per-year Small Business Administration lending unit, second in size behind The Money Store.
By applying for SBA loans through Morristown, N.J.-based AT&T Capital, AMA member physicians would pay lower loan application fees than they would elsewhere, says Chris Hooker, AT&T Capital's vice president of national accounts. AT&T Capital sends the SBA a 2% or greater fee on the SBA-guaranteed amount of the loan, plus a $1,000 application fee. The company also charges closing, credit-check and other fees common in conventional loans.
Because AT&T Capital and AMA Solutions have not signed a contract yet, Hooker says he cannot comment on what fees AT&T Capital may waive or reduce for AMA member physicians.
However, AT&T Capital cannot violate federally mandated SBA standards like interest rates and loan eligibility, Hooker says. SBA rates range between 1.5% and 2.75% above prime, which is higher than AT&T Capital's conventional loan fees. The advantage of SBA lending is that borrowers can get longer terms.
Hooker says that AT&T Capital also will let member doctors be the first to receive the company's customized SBA application on computer disk, a product that has just been introduced.
Unlike the practice financing services offered through AT&T Capital, AMA Solutions' deal with Boston-based Scudder, Stevens & Clark, signed May 12, focuses on offering mutual funds and other services for physicians' personal pocketbooks.
AMA Solutions executive director Camille Oldenburg says that a long-term goal for the relationship with Scudder is to have the company offer its investment services to physician practices as well as the doctors themselves.
Meanwhile, AMA Solutions is investigating contracting with law firms to offer prepaid legal services to physicians. Oldenburg says AMA Solutions likely will spend the next four to six months talking to various law firms before negotiations begin.