The American Medical Association, Chicago, expects an operating profit of about $200,000 this year, despite another year of significant decline in membership revenue, officials said at the organization's midyear meeting. It would be the third consecutive year in the black for the AMA, which earned about $4.9 million in 2001 and $2.7 million in 2000 after financial problems in the mid- to late-1990s brought on by a steep reduction in membership. Despite the otherwise bright fiscal news for the AMA, revenue from membership is projected to decrease by about $4.3 million in 2002, or about 7.9%, and by an additional $4 million in 2003. According to official numbers, the AMA's membership is about 278,000, but top officials acknowledge that the real total is about 260,000, the lowest figure in decades.
"Membership is a tough problem," said Michael Maves, M.D., the AMA's executive vice president and CEO since January. "It's much more difficult to solve than what I thought it would be." The AMA hired a marketing executive last fall to develop a plan to lure more dues-paying members; the new plan is expected to be unveiled in February, Maves said. The AMA's modest operating profit came during a year in which it was forced into some significant belt-tightening. Earlier this year, the AMA froze its pension plan for employees, replacing it with a defined-contribution program, or 401(k), a dramatic and controversial move that Maves indicated would save the organization about $10 million a year. "I did this with great reluctance," he said. "That's what was necessary to help preserve the health of this organization." -- by Michael Romano