The American Medical Associations expenses were up while its revenue and membership were down in 2008, according to its recently released annual report, but it could have been worse.
Down, but not out
AMA’s revenue, membership fall in ’08, expenses up
Revenue at the 162-year-old, Chicago-based physician organization dropped about 2.6%, to $282 million from $289.5 million in calendar 2007; general and administrative expenses rose 7.9%, to $226.1 million from $209.5 million; and membership decreased about 2% to about 236,000 from 241,000; the report said.
Operating profits dropped sharply, 89.8%, to $2.5 million from $24.4 million in 2007, the report said. It was noted that, although the margin was slimmer, it was also the ninth-straight year the AMA finished in the black. It was noted that this was better than the $8.9 million loss that had been forecasted, asalthough revenue was $4.9 million lower than expectedexpenses was $16.3 million less than predicted, the report said.
The AMA also reported that the organizations reserves fell 15.5% to $284.8 million compared with $337 million in 2007 as the market value of the AMAs stock portfolio dropped by $77.8 million.
The AMA declined to comment on the report, citing a policy of not pre-empting discussion of informational reports being presented at its annual House of Delegates meeting, which is being held June 13-17 in Chicago.
In April, the AMA had announced that it would eliminate 100 selected open and existing positions from its roughly 1,200-employee staff. The financial results of these job cuts are not calculated into the 2008 report. What was calculated was $1.3 million savings in occupancy costs resulting from the consolidating of office space and leasing one less floor at the AMAs Chicago headquarters.
The $7.5 million decline in revenue was linked to a $6.4 million decline in publishing income because of lower advertising (down $3.1 million or 10.9% less than in 2007), subscription and reprint sales. Revenue from membership dues declined nearly 2.9%, down to $43.9 million last year from $45.2 million in 2007.
The 2008 expenses listed $15.6 million in costs related to the AMAs Voice for the Uninsured campaign, compared with $8.4 million spent on the campaign in 2007.
The report also mentioned the AMAs advocacy efforts, and listed the four-year extension of the State Childrens Health Insurance Program and the staving off of a planned 10.6% cut in Medicare physician payments as direct results of those efforts. Also noted was the implementation of green measures that make a difference in healthcare today and create a sustainable tomorrow.
Environment sustainability was a theme voiced by the immediate past president of the AMA, Ronald Davis, who died at age 52 on Nov. 6, 2008, after being diagnosed with pancreatic cancer that February. The report includes a page paying tribute to Davis, noting his accomplishments as a preventive medicine specialist that included spearheading the AMAs anti-smoking efforts.
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