Executive Compensation at the AMA (2022)

The American Medical Association (AMA) is a non-profit 501 (c) (6) – a professional association and the largest association of physicians – whose primary purpose is to:

• publish the Journal of the American Medical Association (JAMA) – a peer reviewed medical journal that includes original research, reviews, and editorials of medicine;
• maintain a code of medical ethics,
• create and maintain physician data which is sometimes referred to as master files; and
• update and maintain medical classification codes (referred to as CPT codes) used by the government, medical practices, hospitals, and insurance companies in return for royalty fees.

Although the AMA is a professional association, membership dues are surprisingly not a large source of revenue for the organization. There are about 1.1 million physicians in the US, but only about 270,000 physicians (practicing, retired, residents, and medical students) belong to the AMA. Membership rates vary ($20-$420). As such, dues account for a very small portion (about $34 million or 8%) of the revenue stream for the AMA.

There are 21 independent voting members (trustees) on the governing board (Board of Trustees), although 24 are listed on the Form 990 (2022), which appears to be due to timing differences.  All board members received compensation although the amounts vary from $34,000 to nearly $300,000.  16 of the 24 (67%) trustees are male while 8 of the 24 (33%) are female.

The AMA reported total revenue of $447 million in 2022 (compared to $493 million in 2021) of which only $34 million (8%) came from membership dues. By far, the biggest source of revenue was from “royalties” which totaled $269 million (60% of revenue) followed by subscriptions, reprints, education programs and credentialing ($85 millions or 19% of revenue), inventory sales ($19 million or 4%), investment income and gain on the sale of assets ($20 million or 4%), and advertising ($15 million or 3%).  In essence, 79% of revenue comes from 2 sources: royalties, subscriptions, reprints, education program and credentialing.

Royalties is a general term for the fees paid by any doctor, group, practice, hospital, or payers (i.e. insurance companies, Medicare, Medicaid, etc) who uses the CPT (Current Procedural Terminology) Codes/Booklets/Etc (a medical code set established and maintained by the AMA) that the AMA established to classify medical, surgical, and diagnostic services.  This is by far the largest source of income to the AMA who holds the copyright for the CPT Coding system. Therefore, any person or organization that uses the codes must pay license fees (royalties) for the use of the codes.

Expenses totaled $359 million (not including $11 million in depreciation) with the largest expense reported to be compensation.  1,361 employees received $210 million in compensation which equates to an average compensation of nearly $154,000 (note:  the AMA also spent at least $3 million more on outsource staffing).  However, only 655 employees received more than $100,000 with the 16 most highly compensated reported to be:

• $2,914,728:  James L Madara, EVP and CEO
• $2,550,156:  Howard C Bauchner, SVP, Editor in Chief
• $1,591,948:  Kenneth Sharigian, Chief Strategic Officer
• $1,363,218:  Thomas J Easley, SVP, Publisher
• $1,343,982:  Laurie A S McGraw, SVP, Health Solution
• $1,304,823:  Phil Fontanarosa, VP and Acting Editor in Chief, JAMAA
• $1,273,791:  Thomas Giannulli, SVP, Chief Medical Info Officer
• $1,092,138:  Todd D Unger, SVP and Chief Experience Officer
• $1,055,759:  Denise M Hagerty, SVP and CFO
• $  875,544:  C Todd Askew, SVP, Advocacy
• $  871,953:  Karen Maybank, SVP, Chief Health Equity Officer
• $  304,976:  Gerald Harmon, President, Past President
• $  297,560 :  Jack Resneck, President-Elect, President
• $  253,452:  Sandra Adamson Fryhofer, Chair Elect/Chair
• $  200,555:  Jesse M Ehrenfeld, Trustee/Chair Elect
• $  194,843:  S Bobby Mukkamala, Chair/Past Chair

The 16 most highly compensated employees received more than $16 million, which equates to an average compensation of $1 million.  However, it is interesting to note the gaps in compensation appear to be because the individuals at the bottom of the list are trustees who sit on the Board.

The most highly compensated employee was James Madara who received nearly $3 million in compensation in 2022 and $20 million from 2015-2022.

The 11 most highly compensated employees received more than $70 million in compensation from 2015-2022 (note:  highly compensated employees in 2015-2021 but not in 2022 are not included in the list below):

James Madara:  Total Compensation 2015-2022:  $20 million

• 2022:  $2,914,728
• 2021:  $2,646,192
• 2020:  $2,902,055
• 2019:  $2,483,665
• 2018:  $2,536,019
• 2017:  $2,245,446
• 2016:  $2,269,117
• 2015:  $2,035,378

Howard Bauchner:  Total Compensation 2015-2022:  $9 million

• 2022:  $2,550,156
• 2021:  $1,163,902
• 2020:  $1,116,913
• 2019:  $1,007,225
• 2018:  $1,057,572
• 2017:  $  922,457
• 2016:  $  843,012
• 2015:  $  687,290

Kenneth Sharigian:  Total Compensation 2015-2022:  $10 million

• 2022:  $1,591,948
• 2021:  $1,541,212
• 2020:  $1,531,973
• 2019:  $1,340,374
• 2018:  $1,130,659
• 2017:  $1,027,918
• 2016:  $  893,246
• 2015:  $  902,470

Thomas Easley:  Total Compensation 2015-2022:  $8 million

• 2022:  $1,363,218
• 2021:  $1,244,549
• 2020:  $1,169,153
• 2019:  $1,053,055
• 2018:  $  900,763
• 2017:  $  745,367
• 2016:  $  680,726
• 2015:  $  646,592

Laurie McGraw:  Total Compensation 2017-2022:  $8 million

• 2022:  $1,343,982
• 2021:  $1,166,385
• 2020:  $1,215,052
• 2019:  $1,168,413
• 2018:  $1,054,269
• 2017:  $  900,977

Phil Fontanarosa:  Total Compensation 2021-2022:  $2.4 million

• 2022:  $1,304,823
• 2021:  $1,129,031

Thomas Giannulli:  Total Compensation 2021-2022:  $2.3 million

• 2022:  $1,273,791
• 2021:  $1,117,127

Todd Unger:   Total Compensation 2019-2022:  $4 million

• 2022:  $1,092,138
• 2021:  $1,037,506
• 2020:  $  970,250
• 2019:  $  978,376

Denise Hagerty:  Total Compensation 2015-2022:  $6 million

• 2022:  $1,055,759
• 2021:  $  945,462
• 2020:  $  821,308
• 2019:  $  790,596
• 2018:  $  730,874
• 2017:  $  681,904
• 2016:  $  691,027
• 2015:  $  693,782

C Todd Askew:  Total Compensation 2022:  $0.9 million

• 2022:  $875,544

Karen Maybank:  Total Compensation 2022:  $0.9 million

• 2022:  $871,953

12 of the 16 (75%) most highly compensated employees are male while 4 of the 16 (25%) are female.

The AMA paid for first class or charter travel and health or social club dues or initiation fees.  In addition, the AMA has various deferred compensation plans. Please refer to the Form 990, Schedule J, Part III, Supplemental Information for more information on first class travel, health or social club dues and the retirement plans.

138 independent contractors received more than $100,000 in compensation with the 5 most highly compensated reported to be:

• $1.9 million:  Silverchair, of Charlottesville, VA for IT services
• $1.8 million:  City Staffing, of Chicago, IL for staffing services
• $1.3 million:  Forward Health Group, of Madison WI for IT services
• $1.0 million:  Creative Circle, of Chicago, IL for staffing services
• $0.9 million:  Silverchair Science, of Charlottesville, VA for IT services

In summary, the AMA’s golden goose is its medical classification coding system – the CPT Coding System, which is the primary source of the organization’s revenue, followed by subscriptions, reprints and credentialing. 1,361 employees worked for the AMA in 2022; their compensation ($210 million) accounted for the largest expense although millions more was also spent on outsource staffing.  The top executives are compensated millions ($16 million to 16 executives in 2022 and more than $70 million to these employees from 2015-2022) and the organization paid for first class travel and paid for health or social club club dues or initiation fees.

To read the IRS Form 990 (2022), click here.