Edward Toriello, MD
|From the Treasurer
Expanding our horizons to support programming, services
In this third column on the AAOS financial situation, I plan to focus on the future. As we enter a new millennium, it becomes imperative that the AAOS expand its horizons and look beyond traditional sources of revenue to fund our educational programs and member services.
For several years now, membership dues have averaged about a third (32 percent) of annual revenues. The Annual Meeting and sales of educational products made up an additional 40 percent of revenues, with the remaining income from management fees, investment income and facilities rentals. But two important factors will affect the future availability of funds from these sources.
The first is population. The number of younger orthopaedic surgeons is dropping; only about 15 percent of the fellowship is under age 40. Nearly 40 percent of the fellowship is between the ages of 50 and 65. As older fellows become Emeritus, and with fewer young fellows, the percentage of revenues from dues will drop dramatically.
The second factor is competition. At one time, the AAOS was the only source of educational materials on ortho- paedics. Now, there are several publishers, online services and instructional offerings available, all competing for your time, attention and dollars. Fellows must make hard decisions about whether to attend the AAOS Annual Meeting or a specialty society meeting, whether to participate in an AAOS Instructional Course Lecture or one sponsored by industry, whether to get CME credit through the AAOS or through some other source.
Tapping into corporate funds
Consequently, it is only prudent that the AAOS begin to examine other revenue sources and ideas. The Corporate Relations Advisory Group (CRAG) has helped to develop corporate funding sources within the orthopaedic industry. But these may become more difficult to identify as industry expands its own offerings. To tap new markets, the AAOS has joined with the Orthopaedic Research and Educational Foundation (OREF) in adding a professional corporate development director, Dane B. Duval, to our team.
Duval brings nine years of corporate development experience working with the City of Hope, a nonprofit, National Cancer Institute-designated Comprehensive Cancer Center located in Duarte, Calif. He also has more than 20 years solid corporate business experience in line management, administrative management, sales and sales management within the fields of commercial finance and leasing. His goals are to seek new business relationships and sources of revenue and to expand our current support base through corporate partnerships with industries historically not related to orthopaedics. We have already see the effectiveness of such partnerships in funding projects such as the Safe, Accessible Playground Builds in the Annual Meeting cities.
In addition to corporate outreach, the AAOS will make a more concerted effort to obtain government funds when appropriate. The Council on Education is developing an overall orthopaedic curriculum that may be underwritten by government sources that fund the improvement of educational processes.
Leveraging our expertise
Over the years, the AAOS and its staff have developed expertise in a number of areas, including publishing, association management and practice management. Now we are looking for ways to leverage that expertise to generate funds that can be used to support and expand our services to members.
The AAOS international department already generates nearly $700,000 from translation rights to, and English-language print sales of, AAOS materials and journals. We anticipate that this figure will continue to grow as we open and expand markets around the world. AAOS educational courses conducted in other countries often provide the first exposure of AAOS educational products to international orthopaedic surgeons.
In addition, the international department is looking for support to help develop distance-learning opportunities. Internet-based technologies, supported by real-time audio and video, can make it possible for AAOS instructors to conduct courses here in the States for physicians around the world. This would bring information to a greater number of physicians, lessen the need for overseas travel and reduce course-related costs significantly.
The AAOS recently made a significant book and CD donation to the new National Training Institute (NTI) in Cairo, Egypt, constructed by Project Hope in conjunction with a grant from the Pfizer Corporation. This is the first time the AAOS has worked with an agency like Project Hope, and we are exploring opportunities to work with the NTI to conduct education programs for orthopaedic surgeons throughout the PanArab region. In addition to making the AAOS an even more significant world force in orthopaedics, joint efforts like this can increase international memberships, promote peripheral sales of books and materials and attract attendance to the Annual Meeting.
On the home front, the AAOS has a highly developed program in print, electronic media and web publishing. As a result of this publishing experience, it may be possible for the Academy to provide project management, consulting and publishing services to other associations, perhaps even to specialty societies.
Finally, there is the possibility of providing practice management products and services to AAOS members through business arrangements with vendors. These products would have to meet several criteria, including quality, availability, relevance to orthopaedics, cost-savings for members and income generation for the Academy. We are currently examining two business arrangements with vendors to determine if either opportunity would be beneficial to our members.
As the AAOS explores each of these areas, we will keep the Fellowship informed of our progress. It is incumbent for us to expand and diversify our revenue base in order that we can continue to provide the large number of varied services to you our members without undue reliance on moneys received from dues.