The American Medical Association reported an operating loss after taxes of $1.7 million in 1997, ending a two-year streak of positive margins.
Meanwhile, former Executive Vice President P. John Seward, M.D., who resigned in early December after approving a controversial product endorsement deal with Sunbeam Corp., took home a $472,272 compensation package that included a $39,600 bonus. Seward did not receive a bonus in 1996, and no explanation for the perk was contained in a report the AMA made available to its delegates last week.
An AMA spokseman said the bonus was a "lump-sum merit payment" made in the first quarter of 1997, based on the institution's performance in 1996.
The bonus could become an issue at the AMA House of Delegates annual meeting this month in Chicago, where some members are expected to question the financial impact of the Sunbeam deal.
According to an auditor's report also released to delegates, operating revenues were $236 million in 1997, compared with $221 million in 1996, when net income was $7.6 million. Assets climbed to $272 million from $236 million in 1996.
The AMA last reported an operating loss in 1994, when it lost $12.7 million.
The AMA's major revenue generator, membership dues, totaled $69.3 million down slightly from $69.5 million in 1996.
Revenue increases were seen in advertising, book and product sales, royalties, financial-services commissions and fees, and subscriptions, which totaled $141 million. That revenue growth was offset by increased expenses for salaries, direct publication, meetings and travel, computer equipment, interest, and nonpublication postage, printing and promotion.
Officers and trustees received $2.3 million, or an average of $109,800 each, up 4.5% from $2.2 million in 1996.
Compensation for the AMA's 20 trustees was raised as a concern in a report that will be considered at the delegates' meeting. The report, by a special House committee, concluded that generous compensation for representation work may detract from fiduciary chores.
According to the report, AMA officers and trustees devoted 65 to 227 "assignment days" last year on such paid activities. Top earners were President Percy Wootton, M.D., $231,191; President-elect Nancy Dickey, M.D., $223,023; and immediate past President Daniel Johnson Jr., M.D., $221,979.