The 'new' hospital philanthropy: From capital projects to population health

A shift away from capital projects to preventive health programs

Hospital leaders are "rethinking" traditional strategies to use philanthropy to fund specific programs and capital expansion in favor of "more ambitious projects" related to health reform and population health management, Beth Kutscher reports for Modern Healthcare.

After a slight decline in 2009, the recovering economy has freed up more dollars for health care philanthropy. The Association for Healthcare Philanthropy reports that charitable giving increased by 8.2% between 2010 and 2011, reaching a record $8.94 billion in charitable gifts to health care organizations.

However, "fundraisers are being asked to redefine what philanthropy will mean in health care," says David Flood, chief development officer at Intermountain Healthcare in Salt Lake City. The 21-hospital system has shifted its focus from construction projects to installing a health care IT infrastructure and expanding outpatient services.

"It's not unusual to have donations made to support building projects," says EVP and CFO Bert Zimmerli, adding, "I'd say we covered the gamut, historically. We want to absolutely continue to do that, but we also want to raise our vision a bit."

Similarly, CentraCare Health System in Minnesota has refocused donations to focus on preventive health, like its Better Living: Exercise and Nutrition Daily (BLEND) program. "It's the opposite of treating conditions as they come here," said Greg Klugherz, CentraCare's VP and CFO. The program supports food labeling and nutritional scoring to promote healthy lifestyles. Khugherz added that it has enabled the system "to be more of a protagonist outside of our normal health care options."

"Philanthropy tends to be a very small piece of the pie, but it really takes a hospital from good to great," said Wilmington Trust's Walter Dillingham Jr. Philanthropy generally represents about 3% of revenue at the hospital, but he says, "[o]ur belief, and the belief of many others, is that as margins (get thinner at hospitals) philanthropy will be even more important going forward" (Kutscher, Modern Healthcare, 7/20 [subscription required]).


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