The Healthcare Financial Management Association reduced its losses last year with help from a rebound in investment returns.
HFMA sees smaller shortfall
Form 990 shows group cut losses thanks to investments
The professional association, which largely earns its revenue from membership dues, publications and affiliate payments, reported a loss of roughly $73,300 for the fiscal year ended May 31, on revenue of $18.6 million, according to the group's recently filed 2009 Internal Revenue Service Form 990. In the prior year, the Westchester, Ill.-based group lost about $510,200 on revenue of $18.3 million.
Investment gains were largely responsible for narrowing the trade group's deficit, but the group also made cuts to some spending that held its expenses almost flat.
The HFMA's investment income totaled $481,142 in the year ended May 31, a reversal from the losses of $425,898 the prior year. Nonetheless, the gains remain well below the investment income of $743,700 for the year that ended in May 2008, when the association reported an overall profit of $2.1 million on revenue of $20.1 million. That year, the association also sold some investments, which increased its revenue by $1.3 million.
Revenue tabulated on its 2009 Form 990 from HFMA programs—education efforts, newsletters and other publications, and industry forums—increased by 2.8% to $18.2 million. The group's expenses decreased by less than 1%. That's despite an increase in salaries, compensation and benefits of 6.2%. The organization reported 88 employees last year, compared with 112 the prior year, but Ed Czopek, the HFMA's chief financial officer, said the decline was a result of changes in reporting rules that eliminated some part-time workers from the total.
Richard Clarke, president and CEO of the association, saw his total compensation—base pay, bonuses and incentives, other compensation, retirement and deferred compensation, and taxable benefits—decline 4% to $636,927. Clarke's base pay increased 5% to $407,098, but his bonus and incentive pay slipped 13% to $126,002. Retirement and deferred compensation dropped 59% to $17,219.
The association's remaining expenses dropped about 8.5%, with the largest reductions coming from its publications; staff education and recruiting fees; and office expenses.
The overall drop in expenses came as the HFMA spent $666,000 on the development of revenue cycle benchmarking and educational software, Czopek said (Nov. 1, p. 32).
The HFMA tax return does not include revenue and expenses from its yearly meeting, the Annual National Institute, or most of the association's educational seminars.
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