July 8, 2013
APA and the APA Insurance Trust Announce New Business Relationship
WASHINGTON — The American Psychological Association (APA) and the American Psychological Association Insurance Trust (The Trust) are pleased to announce that they have agreed to restructure their long-standing relationship, and, together with the American Psychological Association Practice Organization (APAPO), enter into a new business arrangement.
This new relationship will enhance the ability of APA and APAPO to provide funding for mission-related advocacy and other projects and, at the same time, enable The Trust to strengthen the stability of its insurance programs through an expanded marketplace while continuing to offer a premier array of insurance and financial security products and risk-management services to its policyholders.
The Trust was established by APA in 1962 as a separate and distinct legal entity from APA, controlled by an independent Board of Trustees. Pursuant to the new business arrangement, The Trust will continue to operate as a separate, legal entity, and The Trust Charter will be revised to remove APA involvement in the internal governance of the Trust, including the elimination of the ex-officio Trustee appointments to the Trust Board for APA’s CEO and Treasurer. The new business arrangement will allow The Trust autonomy to deal with an array of business decisions it faces and is best qualified to make, such as what products to provide and to whom. While The Trust will continue to offer insurance and financial products and services to APA members and individuals associated with such members, The Trust will now also have the ability to offer products and services to non-APA members and other mental health and allied health providers.
Under the terms of the new business arrangement, APA will receive a one-time payment from The Trust totaling $6.25M, which will be paid over the next 24 months. Going forward, The Trust will operate as a program partner with APAPO and will be the sole authorized and preferred insurance provider for APA and APAPO members under a 5-year agreement, for an additional payment totaling $3.75M. The majority of these prospective payments — $3,525,000 — will be designated to the APAPO budget to support its mission. Taken together these payments from The Trust will provide a critical new revenue stream to APAPO and APA to fund their respective mission-related work, including advocacy for appropriate reimbursement for psychological services, research funding, mental health care access and quality in psychology education.
“We are very pleased to enter into this new agreement with The Insurance Trust,” said Norman B. Anderson, PhD, APA CEO. “This agreement reflects an evolution of our longstanding relationship, and it will be beneficial to APA, APAPO, The Trust and those we serve.”
“The Trust is excited about this new business arrangement with APA because of the many benefits to policyholders, APA members and psychologists,” said Jana N. Martin, PhD, The Trust CEO. “We are pleased to be able to provide support for APA members, especially those in independent practice; to expand our market to all psychologists and allied health providers; and to have a positive business relationship with APA and APAPO.”
Over the last two years, APAPO has assumed the responsibility for selecting and managing affinity and business-partner programs for all APA and APAPO members. The APAPO will manage the program partnership with The Trust.
The new business relationship between APA, APAPO and The Trust became effective on July 1, 2013.
For information about The Trust’s insurance offerings visit The Trust website.
APA Office of Public Communications