Excerpt from Hoover Profile of the AMA ~ self-serving political activities

AMA history of dirty politics excerpted from as the Hoover Profile of Businesses in the US

This is an excerpt from the 2005 Hoover Profile, which was originally posted on Answer.com. Its report on the AMA was scrubbed from the Internet in 2008, so none of its links work.

“The AMA registered its opinion on compulsory health insurance in 1920, when its House of Delegates passed a resolution condemning any national health insurance policy. The group feared that government would interfere in the relationship between doctor and patient, and that physicians would not be adequately compensated for their services under a compulsory insurance system.

Throughout the 1920s, the AMA opposed changes in the way physicians were paid. It disapproved of contract medical practices, in which, for example, a mining company paid a doctor a salary to look after its workers at a mining camp. It also disapproved of group hospital plans, whereby employers or groups would pay a lump fee to hospitals to cover hospitalization costs for its workers or members.

By 1933, the Great Depression had exacerbated already existing problems in the nation’s medical care. Huge numbers of unemployed could not afford to pay doctors, and there was no national policy for dealing with this crisis.

The AMA worked with the Roosevelt administration in drawing up some legislation that affected health care. For instance the AMA approved the administration’s plan to have the government pay for medical care for federal employees under the Civil Works Administration, enacted in 1933.

But the AMA continued to oppose any broader form of national health insurance. The AMA had formed a Bureau of Medical Economics in 1931, which spoke out against any insurance plans that might change the way doctors were compensated.

The group put out pamphlets, spoke on the radio, and supplied high-school debating teams with material backing the AMA’s position against compulsory insurance.

The Social Security Act was passed in 1933, giving all Americans retirement benefits. But largely because of the vociferous opposition of the AMA, the act lacked any national compulsory health insurance.

The AMA continued to oppose group health insurance practices in the 1930s, until in 1938 a federal prosecutor pressed charges against the group for threatening to expel doctors who worked for a non-profit cooperative Group Health Association in Washington, D.C. The case was long and complex, and eventually, the AMA paid a fine.

Meanwhile, the AMA continued to crusade against quack medicines. In 1936 the AMA began offering its Seal of Acceptance to food manufacturers who passed standards of safety and hygiene and who did not advertise unproved benefits of their products.

The association also spoke out on issues of general nutrition. It recommended enriching milk with vitamin D in 1936, and promoted the use of iodized salt to prevent hypothyroid disease. In 1938 the AMA published a book called The Normal Diet. This was the first comprehensive and authoritative listing of what Americans should be eating.

The AMA continued to work on familiar issues during World War II and after. The group promoted public health issues such as the fluoridation of drinking water and the curbing of drunk driving.

At the same time, the AMA continued to lobby Washington against national health insurance. When President Truman again raised the idea of mandatory national health insurance in 1948, the AMA quickly spoke out against it. The AMA began levying dues from its members for the first time in 1949, which gave the organization ready cash to pay for publicity.

Over the 1950s, the association spent millions of dollars on various campaigns to influence opinion against national medical insurance.

This fight intensified in the 1960s, when John F. Kennedy came to office pledging to provide medical insurance for the indigent aged, a program that became known as Medicare. The AMA spent heavily to block Medicare. The group claimed 180,000 physician members at that time, and all received posters and pamphlets for their offices to inform patients of their doctor’s opposition to Medicare.

Its writers produced speeches for members’ use, put out radio advertisements and full-page ads in big-city newspapers, and came up with instructions for the AMA’s Women’s Auxiliary to begin a letter-writing campaign.

In 1961 the AMA began contributing money to politicians’ election campaigns. As a nonprofit organization, the AMA could not contribute money directly, but it set up an organization called the American Medical Political Action Committee, or AMPAC, to filter money to its candidates.

AMPAC apparently had vast resources from the beginning and is still one of the wealthiest political action committees in the nation.

The AMA brought in revenue through annual membership dues and by selling advertising in its publications. Ad revenues rose in the 1960s, peaking in 1967 with $13.6 million, which was more than 40 percent of the organization’s total revenue.

As a result, pharmaceutical companies cut their advertising budgets, and the AMA found its income shrinking. The AMA raised membership dues to take up the slack, bringing them up from $45 to $70 in 1967.

Inflation and the lack of advertising revenue put the association in a perilous financial position at the end of the 1960s, and the AMA began the 1970s in the red.

In the early 1970s the AMA began to lose members when several state chapters stopped requiring their members to be AMA members as well.

The AMA began operating under a strict fiscal plan that aimed for increasing membership fees to cover operating costs for a period of five years.

Though the number of regular members declined in the late 1970s, growing numbers of residents and students signed up. In 1975 the AMA had just over 179,000 total members. 8,700 were residents, and 8,100 students. By 1982, total membership was 213,400. The number of residents and students had risen sharply, to 27,900 and 26,900, respectively.

Sammons also overhauled the association’s publishing ventures. A single group vice-president for publishing became responsible for all publications, and all were reviewed. As a result, some ceased to publish, and others were sold. By 1979, the AMA’s publishing division was financially sound. It began bringing in money through new projects with broad consumer appeal, such as the AMA Family Medical Guide, published in 1982.

The group spent lavishly on its public outreach campaigns, backed by money from its for-profit arms such as its successful publishing division.

At the same time, the AMA had taken increasingly conservative political stances, and its political involvement in Washington often displayed mixed motives. For instance, although the group endorsed gun control as a public-health issue, its political action committee also gave generously to the campaigns of politicians who were outspoken supporters of the National Rifle Association.

In 1997, the AMA suffered a scandal when it revealed an arrangement it had signed with the Sunbeam Corporation, a small-appliance manufacturer, to give the firm’s goods an AMA seal of approval in exchange for royalties. AMA members protested that the arrangement tarnished the group’s image. The AMA was forced to break the deal with Sunbeam and eventually had to pay substantial damages to the company.

The fracas meant a new loss of members, and that, combined with the payment to Sunbeam, sent the AMA into the red once again. The group also lost money in 1999, ending the year with a loss of $5.4 million. Revenue from dues continued to shrink, and the organization had also had to spend millions to prepare its computers for the year 2000.

The group continued to struggle with ways to attract and retain members in the 2000s. At a meeting in June 2000, the AMA revealed a new plan, to let doctors pay a one-time fee to join for life.

At the same time, the AMA entertained proposals to drop dues altogether, and automatically grant membership to all American physicians. By 2000, the AMA claimed only about 30 percent of American doctors as members. The organization had struggled with dwindling membership for decades, and the trend did not seem as if it would reverse easily.

Faced with this probability, the AMA looked for ways to trim its budget and to bring in more money.

At its 2000 national meeting, the group announced it would begin to peddle its information technology services. The AMA’s executive vice-president, E. Ratcliffe Anderson, claimed in an article in Modern Healthcare (June 19, 2000) that the AMA was ‘probably the most data-rich entity anywhere in the world of medicine.’

Information technology initiatives, such as a new online health network called ‘Your Practice Online,’ would bring the group the financial success it needed in order to continue to fund its work.