After a public outcry, the American Medical Association recently canceled its contract to endorse Sunbeam Corp. medical devices, and it banned all future consumer product endorsements. But the group's backpedaling does not change fiscal reality: The AMA needs money.
There is a way for the organization to obtain the funds it needs without alienating the public or its members. The AMA should offer its services, for a fee, to analyze medical devices and products and provide a Good Housekeeping-like seal of AMA approval to those that are worthy.
The recent public spectacle certainly was not one of the AMA's finer moments. In early August, the group agreed to an exclusive endorsement deal with Sunbeam. In exchange for millions of dollars, the AMA would allow the company to place America's largest physician association's seal on such items as home blood pressure kits, heating pads and vaporizers.
This was not a joint product-development deal in which the AMA would offer its input to create better equipment for the patients it claims are its first priority. It was an endorsement deal, pure and simple. Just as Kodak had paid money to be designated the official film of the 1996 Olympics, so too would Sunbeam pay to market the official heating pad of the AMA.
Public outrage followed. Editorial writers, consumer advocates and patients waiting in doctors' offices all sounded a similar note. The AMA's shenanigans had made the country's doctors look like a bunch of fools. Some physicians I know canceled their AMA membership. I am a member, and I also thought of resigning. The AMA had cheapened itself. It had put its financial concerns above common sense. One observer noted that it was as if the AMA had set off a nuclear bomb of bad publicity.
Within days, the AMA canceled its contract with Sunbeam. The group announced that it would continue to print informational literature to be placed in the packaging of health products, but this would be on a nonexclusive and not-for-profit basis. Sunbeam is suing the AMA, charging breach of contract. Four senior AMA executives, including Executive Vice President P. John Seward, M.D., have departed following the ill-fated deal. A committee of physicians will investigate whether the trustees had prior knowledge of the contract.
In the wake of all this, the AMA House of Delegates decided earlier this month to ban all consumer product endorsements.
But that's an overreaction. The AMA did have pressing reasons to go after lucrative endorsement deals. The organization is facing a cash and membership squeeze. It charges 300,000 members nearly $500 each in annual dues. Most of those who join the AMA purchase a packaged state, local and national medical association membership -- with a tab that usually runs about $1,000. Doctors, faced with the realities of shrinking incomes under managed care, are becoming reluctant to pay this amount of dues money. The threat of membership atrophy is real.
The AMA needs money to fulfill its stated mission of providing advice, services and representation for physicians, as well as education and advocacy for patients. If the group keeps getting that money solely from membership dues, it risks continuing to lose members. And if that happens, the AMA becomes irrelevant.
There is an alternate means of generating the needed income. Rather then endorsing a specific product, the AMA should test and analyze a spectrum of products. Each manufacturer of home health and other medical items will pay for the opportunity of having their products scrutinized by the AMA. Products that meet a threshold of quality will receive the AMA "seal of approval." This, in turn, can be used by companies for promotion and advertising.
For the AMA to establish this service will require more work than simply handing over its seal in exchange for cash. The organization will have to decide which products are eligible for testing (home health products? over-the-counter medicines? fitness videos?). It will have to build or gain access to existing testing facilities, develop protocols for the tests and standards for "AMA certified" quality, hire specialists to execute these tasks and managers to supervise the process, and form a legal team to negotiate contracts with the healthcare companies whose products are being tested.
In short, the AMA must develop a services-oriented infrastructure to make this a viable enterprise. And for the venture to be sustainable it must have the veneer of professionalism. The group running the show therefore will have to be of a more sophisticated ilk than those who came up with the Sunbeam deal. All this will take time and effort, as well as upfront cash investments.
For the AMA, the rewards will be worthwhile. Many healthcare and medical device companies will be interested in this service. After all, Sunbeam was willing to pay for a blind endorsement, while the fees paid in this case will signify the AMA's testimony on behalf of the products' quality (assuming that the products pass the AMA's tests). If the group charges a premium price for the opportunity to earn its seal of approval, it will create a steady stream of income.
Healthcare is now a commercial enterprise. From health insurance to pharmaceuticals to hospitals to physicians themselves, aggressive commercialism in the form of advertising, cutthroat competition and close attention to the bottom line now rule the day in healthcare. These are the facts of today's healthcare economy. The AMA didn't start the trend with its endorsement deal. It just offered a particularly crass example of a reality that has developed over the past 10 years.
Just because the AMA is guilty of poor judgment and poorer taste doesn't mean the group is wrong to seek needed income. In today's complicated and rapidly changing healthcare market, it's useful for physicians, patients and policymakers alike to have a group that speaks in one voice for the majority of the nation's doctors.
The healthcare cacophony is great these days. The AMA's first job is to look after its members, so it is by no means impartial. But maintaining a loud physicians' voice within the chaos will serve as a necessary professional counterbalance to the sound of so many shouting only in favor of their own enrichment. In the end, not only doctors but also patients will benefit from physicians participating in the debate.
Maintaining a strong national voice takes money. The AMA has to join the modern era of for-profit healthcare in order to continue to function. An AMA seal of approval at least lets the group do it in a way that offers consumers some useful information.
Krieger is a plastic surgery resident at UCLA Medical Center and also works as a healthcare consultant.