For the fourth year in a row, the American Medical Association made money, turning in a 72 percent increase in operating profits last year, the group’s annual report shows.
The Chicago-based national doctor group said the run in the black is the longest in more than a decade as the group holds the line on expenses in a period of flat revenue from member dues and advertising in its publications, which are among the biggest contributors to the balance sheet.
The 157-year-old AMA reported a $20.1 million operating profit in 2003, compared with $11.7 million in 2002. Revenue rose 2.3 percent, to $256.3 million from $250.5 million a year earlier.
“We have successfully weathered an economic downturn,” said Dr. Herman Abromowitz, the AMA’s finance chairman and secretary-treasurer.
“These results continue to demonstrate our significant efforts to improve efficiency and productivity while focusing our resources on our core mission,” he said.
With revenue from member dues dipping to $49 million from $50.2 million, the AMA continues to rely on its large publishing operation to improve sales and profitability, according to the group’s annual report. The group has lost members steadily in recent years but said the trend is beginning to subside.
Still, the AMA acknowledges its reliance on sources of revenue outside of membership to maintain a healthy balance sheet. Book and product sales jumped 6 percent, to $44.1 million from $41.7 million a year earlier, the report says. Advertising rose to $41.1 million in 2003 from $41.0 million a year earlier.
The AMA will present the report to its annual House of Delegates meeting next month in Chicago.
Eight states on plate: Downers Grove-based First Health Group Corp.’s pharmacy benefit management subsidiary landed new contracts with eight states to help manage their drug costs and benefits.
First Health Services will help Alaska, Hawaii, Minnesota, Missouri, Nevada, New Hampshire, Ohio and South Carolina develop preferred drug lists and negotiate supplemental rebates with pharmaceutical manufacturers. Terms of the contracts were not disclosed.
Pharmacy benefit managers are increasingly taking on a larger role as states have difficulty reining in their budgets for drugs under Medicaid health insurance programs for the poor and other pharmaceutical benefit programs.
“These states are eager to work with companies like First Health to help them manage their Medicaid and senior pharmacy programs,” said First Health Services spokesman Scott Allocco.
First Health said it assists states in managing more than $10 billion in drug spending.