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AAN CONSIDERS COSTS, BENEFITS OF A POLITICAL ACTION COMMITTEE

The AAN is studying the formation of a political action committee (PAC), used by many medical societies and other professional organizations to increase their influence with Congressional health care policymakers.

Currently, the AAN works with a Washington, DC-based lobbying firm – Powers Pyle Sutter & Verville – to help advance its issues on Capitol Hill and before federal agencies, but it faces financial limits on these activities and for other related expenses that another type of tax-exempt organization, a 501(c)(6), would not.

The AAN faces a $1 million cap on expenditures for activities that federal law considers lobbying, or it risks losing its 501(c)(3) status. This is an amount that varies by organization and is based on their budget. Activities that are not considered lobbying include research, testifying and volunteering, while lobbying is defined as an attempt to influence legislation. Lobbying also includes making campaign contributions.

The AAN Board of Directors would first have to change the Academy's current nonprofit status as a 501(c)(3) organization – which cannot make campaign contributions or engage in some types of political events – to a 501(c)(6), which is legally permitted to form a PAC. The question of whether to proceed with a PAC could come before the board next January or at a subsequent meeting; the Board meets three times a year.

If approved by the AAN Board, the issue could then be put to a vote of the membership at the 2005 or 2006 AAN Annual Meeting, according to Catherine Rydell, AAN Executive Director and Chief Executive Officer. Should the Board fail to approve the formation of an organization that would precede the creation of a PAC, the membership will not be asked to vote on the issue.

Supporters of a PAC say that in an age of increasing government mandates and dwindling payments, it is essential for medical organizations to use all available means to be heard and affect change. The Board discussed various methods of forming a PAC at its meeting in January of this year, but trustees “were not clear on the perceived benefits,” said Ms. Rydell.

Board members agreed instead with Ms. Rydell's recommendation that Academy officials undertake a more detailed examination of the costs and possible advantages of a 501(c)(6) and a PAC before deciding how to proceed.

“I don't want the benefits of PACs to be oversold – or undersold,” Ms. Rydell told Neurology Today. “By taking its time, the AAN will be able to gather more facts about PACs before any vote is taken.”

UNDER STUDY FOR SEVERAL YEARS

The AAN Legislative Affairs Committee has supported forming a PAC for several years; its work on this issue led AAN President Sandra Olson, MD, to empanel a taskforce to further study the issue. The taskforce's final report, presented to the Board in January, recommended that the AAN take the necessary steps to form a PAC.

A PAC, the taskforce concluded, “would greatly enhance the AAN's ability to meet its legislative objectives and reach the AAN's strategic plan's call for increased visibility and influence in Washington, DC.” This would include being able to conduct and attend fundraisers for members of Congress – which is not allowed under AAN's current nonprofit status. Financial contributions would be targeted to have the most impact; the PAC could “decide what the five to ten key congressional votes are for neurologists and make decisions based on support or opposition to these votes,” according to the taskforce.

“You truly cannot buy a vote,” Ms. Rydell said. “What a PAC does is give you a tool to support people who support you. It gives you a way to show your gratitude by helping them with campaign expenses.”

THE RIGHT THING TO DO

The American College of Cardiology (ACC), which has 31,000 members, started on the road to its PAC about four years ago, first forming a 501(c)6 organization, with the intention of starting a PAC afterward.

As a 501(c)3, ACC was subject to a $2 million limit on its lobbying and advocacy expenditures. Such expenditures were unlimited if made by a 501(c)6, but campaign contributions are permitted only under a PAC, said ACC Chief Executive Officer Chris McEntee. “It probably took about a year to have a good debate about the pros and benefits,” she said of the process to form a PAC. “Members were concerned about whether this was buying votes. Those concerns were balanced by the vision of the future of others, who were able to say, ‘We need to do this for our members, in addition to keeping our strong commitment to education and to science.’”

As ACC was researching the issue, it became clear that it was “in the minority” by not having a PAC, she added. When asked by Neurology Today to cite examples of some of the PAC's successes, Ms. McEntee said PAC staff have a “sense that their phone calls are returned more quickly” and they have greater access to members of Congress.

The longer term impact of ACC's PAC, however, is dependent on how much money it can raise, Ms. McEntee said. In its first year of operation, the PAC raised $100,000, she said, meeting its goal. But maintaining that pace in the second year was more difficult, and officials are exploring novel ways to raise funds, she said.

Forming the PAC was appropriate for ACC, she said. “I would absolutely say we need the PAC, and anything new takes time to build up,” said Ms. McEntee. “But from the dollars we have been able to raise and give to candidates already, we really think it has been worth it. Overall our experience has been positive; the next step for us to is to really strengthen our fundraising for the PAC.”

SKINPAC TAKES OFF

Three years ago the American Academy of Dermatology (AAD) formed a 501(c)(6) organization, called American Academy of Dermatology Association, and a PAC, called SkinPAC. The costs to establish and operate SkinPAC are “pretty minimal” and “well worth the expense,” John Barnes, AAD Associate Executive Director for Government Affairs and Health Policy told Neurology Today.

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Ms. Catherine Rydell: “I dont want the benefits of PACs to be oversold – or undersold. By taking its time, the AAN will be able to gather more facts about PACs before any vote is taken.”

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Ms. Chris McEntee: “Members [of the American College of Cardiology] were concerned about whether this was buying votes. Those concerns were balanced by the vision of the future of others, who were able to say, ‘We need to do this for our members, in addition to keeping our strong commitment to education and to science.’”

The longer-term impact of the PAC is dependent on how much money it can raise, said an official of the American College of Cardiology.

“It is not just being able to form a PAC,” said Mr. Barnes of the benefits of the changes AAD made. “It is the ability to more aggressively lobby by having the 501(c)6. Without it your hands are tied, and you are not fully serving your membership.”

In 2003, SkinPAC raised $101,000, more than double the previous year, he said; 2004 dollars are expected to exceed the 2003 amount.

Before joining AAD, Mr. Barnes served as Chief of Staff for former US Representative Greg Ganske (R-IA). Mr. Barnes said he never took calls from PAC members because that would be “crossing a black line.” PAC members dealt only with campaign staff, he said, and he never knew whether an organization had a PAC or not.

Still, he said, PACs and SkinPAC have an essential role to play today, especially on the state and local level. He noted that it has been particularly successful in getting dermatologists back home involved in the political process by contributing to SkinPAC, and going to [local] events for Senators and Congressman. “It has renewed interest in government affairs,” he said. “There are more opportunities for dermatologists to get involved and to see the successes of that.”

A LEAP OF FAITH

The American College of Physicians-American Society of Internal Medicine (ACP-ASIM) may soon have a PAC, as the concept has made its way through the society's various governing bodies.

Like the AAN, ACP-ASIM members wrestled for years over whether to form a PAC. Before the two societies merged in 1998, the internal medicine society had a PAC, while ACP did not. In 2000, the merged organization's Board of Regents decided not to form a PAC.

But over time, “the mood of the members has changed,” explained ACP-ASIM President Charles Francis, MD. “Essentially the feeling among the membership is there is something to be gained over and above what ACP does in terms of advocacy” with a PAC in place.

ACP is a 501(c)3 organization. An ACP affiliate, ACP Services, is a 501(c)6, which permits it to form a PAC.

At its fall 2003 meeting, the ACP board of governors voted to ask its Board of Regents to recommend that ACP Services form a PAC, and its Board, after reviewing a study on the issue, voted in January of this year to recommend that move. At press time, the ACP Services' Board was scheduled to vote on the issue. But Dr. Francis himself is a reluctant supporter of a PAC, and hopes it does not tarnish the ACP-ASIM's reputation.

“The people who were against it did not feel it was necessary, and that it was not the best way for an organization with our history to try to influence” policymakers, said Dr. Francis, Director of the Office of Health Disparities for the New York Academy of Medicine. “I don't know that there's a right answer, but I have more less been persuaded there is no harm in having one – as long it behaves honorably.”