HFMA sees smaller short­fall

Form 990 shows group cut losses thanks to in­vest­ments

Modern Healthcare - - The Week In Healthcare - Melanie Evans

The Health­care Fi­nan­cial Man­age­ment As­so­ci­a­tion re­duced its losses last year with help from a re­bound in in­vest­ment re­turns. 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.

Clarke saw his to­tal com­pen­sa­tion fall 4% to $636,927.

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