Note from the Editor in Chief: The Foundation for Physical Therapy (FPT) has helped to launch the research careers and support the established research activities of many PTJ authors. But there was another reason that I asked Dr Shields to discuss the recent changes in the relationship between FPT and APTA. I believe that this information is relevant to all of our readers—national and international, physical therapist and non–physical therapist, researcher and non-researcher. The experience of FPT and APTA serves as a “case report” to illustrate the importance of knowing the rules, clarifying roles, and preventing conflict of interest when entering into agreements as individuals or as organizations. This case is relevant to those of you who sit on the board of an entity with tax-exempt status, to scientists who seek research funding from an upstanding private foundation, and to donors who expect “above board” behavior. —RLC
In 2002, the Sarbanes-Oxley Act (SOX) (Pub.L. 107-204, 116 Stat 745) was passed in direct response to a number of high-profile cases of accounting improprieties in major corporations.1 Governing boards were not being informed of key financial decisions that affected their companies. The goal of SOX was to codify board, governance, management, and auditor responsibilities to assure accountability to the stakeholders of these major corporations. Since 2002, many organizations have adopted SOX guidelines through bylaws that clarify the legal expectations of governing boards. In addition, in 2008, the US Internal Revenue Service (IRS) made significant changes to Form 990, which is required for organizations that receive tax-exempt status.2 IRS officials have repeatedly expressed the belief that the existence of an independent governing board, combined with well-crafted governance bylaws, increases the likelihood that an organization will act in a tax-compliant manner.3 In consideration of both of these imperatives, the APTA Board of Directors and the Foundation for Physical Therapy (FPT) Board of Trustees agreed to proactively clarify the governance of FPT.
Both APTA and FPT leadership recognized the fact that the tax-exempt status bestowed on charitable research organizations such as FPT—classified as a 501(c)(3)—comes with the expectation that the organization's board is accountable and transparent and has direct oversight in governing the organization's operations. In addition, as a tax-exempt organization, FPT has several restrictions related to advocacy, membership, and services. The services received as a part of membership dues to APTA are quite different from any deliverables from a donation made to a charitable research foundation. For these reasons, a clear distance between political ends of a membership organization and goals of a research foundation is healthy for a profession.
The APTA and FPT leadership have an excellent relationship grounded by a mutual respect for each organization's shared mission, and both organizations embraced the need to develop new bylaws. Representatives from both APTA and FPT met for several months to improve the clarity of the bylaws, to recognize the FPT's independent nature, and to promote sound and transparent governance for the future. Approved by the APTA Board at the June 2009 annual meeting, the new bylaws clearly communicate the healthy and collaborative but independent nature that supports a philosophical partnership between the 2 organizations. Three clarifications characterize the new bylaws. The FPT Trustees (1) nominate and approve the appointment of their new board members, (2) are granted general powers to manage the organization with oversight of all employees, and (3) initiate any future changes in the Foundation bylaws and Articles of Incorporation. Collectively, the bylaws provide the clarity needed to demonstrate the ongoing oversight that is expected in managing a nonprofit, tax-exempt corporation.
The primary goal of FPT is to fund credible scientific research. The methodology to meet this goal is the most important product that FPT offers to the physical therapy community. The FPT is vigilant in educating donors that gifts do not purchase favors regarding the funding process and that the competitive scientific review process is what determines the ultimate recipient of research grants. Donors have the capacity to restrict or endow funds for broad areas of research; however, they cannot “earmark” funds for individuals, section members, or state chapters, as that would conflict with the competitive scientific review process that is the cornerstone of the independent funding of credible research. As a tax-exempt organization, FPT must serve the greater good of the community4—which it accomplishes by funding competitively selected physical therapy research.
Membership organizations such as APTA are “not-for-profit” corporations and, at times, need to acquire data independently to best represent the membership regarding national issues related to health care policy. Fortunately, however, our profession also has an operationally distinct Foundation that can issue “calls for proposals” to fund contemporary research of interest to both organizations, via a competitive review process, with transparent procedures in place to determine how the decision is made to fund investigators or groups. The FPT's scientific review process is critical to minimizing an important source of concern to the public: the independent peer-review process, though never perfect, helps address such issues as “hidden sources of funding” and other forms of bias that may infiltrate any agency.9 Frequent, open rotation of scientific review committee members and transparent oversight of the review process are essential to the integrity of research-funding organizations. We are fortunate to have so many outstanding clinical scientists in our profession willing to volunteer time to assist in this vital process.
The FPT and APTA have a true partnership that is “philosophically linked,” but with an acknowledged need to be “organizationally distinct.” Embedded in memoranda from the early 1990s are reflections by Eugene Michels,5 who served on APTA's staff for 11 years and commented on this exact issue: “The FPT has no political ends.” “Because of its Object and Functions, the APTA rightly has political ends to which it directs its efforts and resources.” “Research believed to be directed by a membership organization may be perceived as biased towards the organization's purpose.” This concern still resonates today when we consider research carried out by the Tobacco Institute,6 drug studies conducted by the pharmaceutical industry,7 or research sponsored by the orthopedic industry.8 Although privately funded research is necessary and beneficial, bias raises questions about the findings. Interestingly, there is a higher rate of positive findings in studies supported by industry, causing some to speculate on the credibility of those studies.6–8
The FPT is poised to embark on funding high-impact comparative effectiveness research studies. The importance of solid evidence is critical to the future of health care, as treatments shown to be ineffective are abandoned in favor of those that are effective. As our profession embraces evidence-based practice, phasing out ineffective treatments in favor of more effective ones, we make a long-term investment in our own professional credibility, a goal that reflects the common philosophy of both APTA and FPT. As an independent, tax-exempt, charitable research foundation, FPT fosters this goal by supporting physical therapy research without restricting or withholding the dissemination of the outcomes. Industry may choose to withhold research findings because they may jeopardize their product; however, a published scientific report demonstrating that a frequently used treatment is not effective is valuable knowledge and contributes to the greater good of society. The FPT's new bylaws clarify the responsibilities and commitment of FPT's Board of Trustees to oversee the mission to advance credible research to the public.
Because of our philosophical linkages, APTA and FPT will always work synergistically for the common good in physical therapy. Indeed, APTA and FPT will continue to work in close proximity to minimize costs and enhance efficiencies. Even to those within the profession, the new bylaws will not be readily apparent as each organization continues to work together to advance research. But there will be a clear separation in governance and management that is necessary to meet reporting requirements for tax-exempt charitable research foundations.
The FPT can now proudly share these bylaws with new trustees, students, faculty, public, corporations, the National Institutes of Health (NIH), and the IRS. Our Board of Trustees can clearly articulate and demonstrate, on paper, our longstanding commitment toward managing a credible charitable research organization devoted to the discovery of new knowledge in physical therapy. This is vital as our nation strives to reform health care and as regulatory agencies continue to increase their vigilance in evaluating tax-exempt charitable organizations. APTA showed vision, insight, and long-term commitment to physical therapy research by proactively developing and approving these bylaws.
The FPT has grown and continues to grow because of the longstanding support of the physical therapy community, which has embraced the concept that “all boats rise with a rising tide” and, therefore, advancing knowledge in the field—even if it does not always advance an individual's specific agenda—is of value to the profession. We are fortunate to have some of the most outstanding scientists in the world advancing evidence in our profession, many of whom received their initial support from the Foundation.
Imagine the satisfaction of the visionaries who started and sustained FPT when they see the number of physical therapists funded by NIH today or the evidence accumulating in our field at an exponential rate. We owe much gratitude to those leaders who created FPT over 30 years ago; it is as though they knew that evidence would guide the future of our profession in the 21st century. By virtue of these new bylaws, APTA demonstrates its unimpeachable integrity and commitment to a Foundation to support research for many years to come.
- American Physical Therapy Association
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