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Case for Lower Dues

The Chicago Medical Society (CMS) Board of Trustees recently approved a 5% dues reduction for physicians who have been members for at least five years. This dues reduction effort joins the list of several other discount programs currently offered by CMS and the Illinois State Medical Society (ISMS). There are dues discounts for students, residents, members in their first four years of practice, trial members in the Partnership for Membership Growth, and for groups with as few as three physicians. The most loyal members of CMS asked for their own dues discount, and the Board of Trustees has responded.

One of the primary goals of dues reduction is to stimulate membership growth. Certainly, basic economic theory dictates that high price is a deterrent to the purchase of goods and services. Recent CMS experience demonstrates the effect of dues levels on membership recruitment and retention.

The Partnership for Membership Growth provides a recent example. When CMS/ISMS membership was offered at no cost, about 1,400 physicians signed up for the trial period. The  challenge now, of course, is to demonstrate the value of the Society so that  trial members want to become full dues-paying members.

In June, we hosted a resident recruitment day at Advocate Illinois Masonic Medical Center. CMS and the American Medical Association (AMA) had membership recruitment tables. Fortunately, the CMS/ISMS dues were being sponsored by a generous donor. As such, the residents had no financial obligation. Of the 16 residents who approached the recruitment table, all 16 signed up for CMS/ISMS membership. In contrast, the AMA had relatively modest dues of $45, but was only able to sign up four out of 16 residents.

Price is a very important component of membership recruitment. Ultimately, CMS must work to keep dues down and demonstrate the value of the organization.

Of course, lower dues will likely have some detrimental effect on CMS revenue. Using current projections, the proposed 5% dues reduction for five-year members could cost CMS up to $30,000. Some of this loss could be recouped if there is a beneficial effect of lower price on membership.

CMS is now in a much better position to deal with diminished dues revenue. After all, there are now two significant sources of non-dues revenue—the CMS Insurance Agency and rentals from the fully occupied CMS building. These sources of non-dues revenue and the reduction of expenses have improved the financial health of the Society. From 2005 through 2009, CMS experienced a deficit for five consecutive years, amounting to a cumulative loss of $1.49 million. In the past three years, CMS has reversed this trend and made $264,000.

It is the desire of the Board that the dues reduction programs be evaluated in terms of their impact on membership and the budget. There is strong sentiment for making the future dues reductions: (a) deeper; (b) more broad-based; and (c) matched by ISMS.

It has been noted that CMS/ISMS already have several dues discount programs. When accounting for the dues reductions to groups and to members in the first four years of practice, CMS already discounts 11.3% off the basic dues. Some trustees have suggested a revenue-neutral approach, with less targeted discounts and more across-the-board dues discounts, even up to 10%.

Whatever the mechanism for dues reduction, the CMS leadership has heard the call for lower dues and has responded. There is great interest among both members and leaders for continuing this trend.

Robert W. Panton, MD
President, Chicago Medical Society

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