By holding the line on expenses in a year in which revenues were flat, the Joint Commission on Accreditation of Healthcare Organizations managed to improve its bottom line last year.
It turned a $4.3 million profit on revenues of $96.2 million, according to the JCAHO's annual tax filing with the Internal Revenue Service. The filing, Form 990, is publicly available.
Last year's profits are the second- highest annual net earnings recorded by the Oakbrook Terrace, Ill.-based healthcare accrediting agency, following 1993's record of $5.2 million.
The profits were generated in the first full year following the hospital industry's rebellion against the JCAHO, which was criticized for pushing products and services many hospitals contended weren't worth the money. The industry's dissatisfaction boiled over in December 1994, when the board of the American Hospital Association issued a vote of "no confidence" in the JCAHO and pressured the organization into making major operational changes in 1995.
Seven representatives of the AHA sit on the JCAHO's 28-member board of commissioners.
But whatever beefs hospitals have had with the JCAHO, they didn't express them at the gate last year.
For example, the Joint Commission enjoyed a nearly 7% jump in revenues from accreditation survey fees. They rose to $76.1 million last year from $71.3 million in 1995.
The JCAHO said it performed 8,278 surveys last year, up nearly 4% over the previous year's 7,997 surveys.
And the Joint Commission's board rewarded JCAHO President Dennis O'Leary, M.D., with a 6.1% salary increase to $390,123 last year. That figure doesn't include another $28,571 in expense account allowances and contributions to his benefits plans.
In fact, the money the JCAHO spent on executive compensation jumped a whopping 27% to nearly $3 million last year from about $2.3 million in 1995, the tax filing showed.
Karen Timmons, the Joint Commission's longtime executive vice president and chief operating officer, received a 3% increase in salary to $250,847 last year.
The jump in executive compensation occurred despite a slight drop in the organization's overall expenses. The JCAHO's total expenditures dipped to about $92 million last year from about $92.5 million in 1995.