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implications from New York for the nation
The strategies employed by New York hospitals in establishing foundations to promote philanthropy provide some valuable perspectives for hospitals across the nation.
Over the past few decades, the U.S. not-for-proñt healthcare sector has undergone signiñcant change as many smaller community hospitals have closed or become part of larger healthcare systems. One area that has not changed is the importance of philanthropy for hospitals, and how many hospitals use a separate fundraising foundation to implement their fundraising strategies.
As not-for-proñt hospitals continue to merge and change, however, they are challenged to determine the appropriate strategy for these separate foundations: Is it best to have one parent foundation for the entire system? Is it best to have separate local foundations? Or is it better to implement a hybrid model?
Insights into how hospitals are addressing these questions can be gleaned from a recent study that examined foundation strategies of hospitals in New York State, which have implications for the entire country.3
A Closer Look at Hospital Philanthropy
Before determining which strategies and structures work best for a given organization, it helps to understand the current giving trends for the industry.
A report on healthcare giving in the United States issued by the Association for Healthcare Philanthropy (AHP) in December 2016 discloses that hospitals and healthcare systems raised more than $9.6 billion in FY15-a 0.2 percent increase over FY 2014. The report notes that donations to not-for-profit hospitals and healthcare systems in the United States increased by $19 million from FY14 to FYi5-b The exhibit below right provides a view of a decade in annual giving for health care, which shows the recent years trending back up.
Fundraising is a key revenue source for many hospitals and is on the rise for healthcare organizations. It's clear that healthcare organizations need to continue to focus on building and cultivating relationships with individual donors, while maintaining a diversified fundraising approach.
Impact of Hospital Mergers on Foundation Model
After a hospital merger, the health system's management and finance leaders must decide howto structure the merged organization's philanthropic foundation. Hospital systems have two primary strategic options in such an instance: to have either a parent or a local hospital foundation. In the parent model,...