The Presbyterian Healthcare Foundation plans to double its annual fundraising goal from $8 million to $16 million over the next five years.
The gift staff at the foundation, which is part of an integrated system of nine hospitals based in Albuquerque, New Mexico, will be looking for major donors to help promote it, said Rick Scott, the foundation’s president. accelerate the organization’s human resources processes. Expanding Presbyterian’s recruitment and retention efforts, he said, is vitally important amid the recent staffing upheaval.
The philanthropy helped fund equipment upgrades, key service lines and locations as well as nursing and staff education this year as Presbyterian’s capital budget came under strain, Scott added. .
“Charity has never been more important than healthcare. There is no doubt it will play a bigger role,” he said. “Historically in our world, philanthropy was considered good. We’re pivoting to solidify it as a must.”
It is expected that nationwide will be more dependent on donors due to the decreasing revenue of hospitals.
Finances are squeezed by higher staffing and supply costs, rising interest rates have increased borrowing costs, weakened COVID-19 relief funding and loss of investment income–The S&P 500 is down about 20% this year.
According to an analysis of 700 nonprofit hospitals from consulting firm Kaufman Hall, the average number of days for hospitals fell by 18 percent between June 2021 and July this year.
There is no meaningful change in donations to the nonprofit hospital, and donors may choose to delay their gift giving as the stock market declines, said industry consultant Paul Keckley. reduce and reduce their write-offs, said Paul Keckley, an industry consultant.
“Non-profit hospitals are not reporting an increase in philanthropy,” he said. “I’m sure that’s partly due to the stock market downturn. Planned giving has exploded in 2020. When the market goes down, people are holding their breath. “
At Presbyterian, it takes philanthropists longer to confirm large gifts, Scott said. That’s why it’s important to check with top donors, he says.
“Sometimes we make the mistake of not communicating enough with each other,” says Scott. “Early on during the pandemic, I called many donors just to see how they were doing, not to ask for gifts but just to have real genuine conversations.”
Kevin Holloran, senior director at Fitch Ratings, said that while the economic downturn may slow down healthcare-related donations, it does not limit overall philanthropy. “I hope that the same will be true of this development,” he said.
Massive donations to well-known systems are still being made as planned. The Mayo Clinic is based in Rochester, Minnesota. received a $100 million gift this month from the Fred C. and Katherine B. Andersen Foundation to expand the health system’s proton therapy business. New England Patriots owner Robert Kraft and his foundation have donated $50 million to develop the Boston-based Massachusetts General Hospital blood donation facility.
Organizations are also trying to raise money for environmental and behavioral health initiatives.
The Northern Colorado UCHealth Foundation, a nonprofit system of 12 hospitals based in Aurora, Colorado, recently launched a $12 million fundraising campaign to renovate Poudre Valley Hospital. A UCHealth spokesperson said UCHealth is trying to meet the state’s rapidly growing population through fundraising campaigns designed to enhance inpatient and behavioral health capacity.
Boston Medical Center, a 514-bed safety net hospital, opened an inpatient psychiatric care and substance use treatment center this month in Brockton, Massachusetts. An unnamed donor contributed $6 million to a $41 million project to install solar and geothermal energy systems.
Jeff Goldsmith, president of Health Futures, a consulting firm, said: “According to ratings agencies over the next year, nonprofit cash flows are expected to weaken enough to threaten bond debt contracts. .
“The bond market is getting tougher,” said Goldsmith. “It would make a lot of sense if hospitals went back to donors.”
According to ratings agency S&P, healthcare companies are more likely to default next year than any other industry.
Service providers are also bracing for an increase in bad debt as millions of Medicaid beneficiaries are expected to lose Medicaid coverage when the public health emergency ends. The Department of Health and Human Services estimates about 15 million people will be removed from the program. Without Medicaid coverage, fewer people would be able to pay for care.
Some hospitals will overcome financial difficulties more than others. Non-profit children’s hospitals isolated by academic links to medical schools and philanthropy are stronger than average, Fitch analysts said in an October report. . The average number of days in children’s hospitals in 2021 is 1.6 times higher than the average number of days in typical hospitals, Fitch data shows.
But many nonprofit hospitals that rely on investment income more than charity will now have to find partners, call on donors or cut costs, Keckley said.
“If business income suffers and it becomes more expensive to invest in healthcare with rising interest rates, you have to do some joint ventures with private equity firms and other stakeholders. other agencies, raise funds or significantly reduce capital expenditures in non-industry businesses. to maintain buoyancy,” he said.
Presbyterian’s Mr. Scott said. For every dollar invested in fundraising, he said, funds should receive an average return of about $4, citing data from the Healthcare Charity Association. By comparison, a surgical unit generates less than $2 for every dollar invested, he said.
“Given the financial challenges healthcare organizations are facing, we need to invest more in philanthropy than in retreat,” Scott said.
