Fundraising flat at hospitals, health systems

Nonprofit hospitals and health care systems in the U.S. raised over $8.9 billion in fiscal 2012, unchanged from a year earlier and 7 percent more than in fiscal 2010, a new report says.

The biggest sources of philanthropy in fiscal 2012 for those institutions were major gifts, grants from corporations and foundations, and annual giving, with each of those strategies generating about 20 percent of donated dollars, says the 2012 AHP Report on Giving from the Association for Healthcare Philanthropy.

Special events accounted for 14.9 percent of donations, and planned giving accounted for 9.5 percent.

Four of five organizations with fundraising expenses of at least $2 million, and organizations that employed seven or more full-time direct fundraising staff, were in the top 25 percent of health care organizations based on total fundraising “production,” says the report, which was based on a survey of nearly 1,700 institutions.

Among the most successful development programs, it says, major gifts accounted for nearly a third of all donations, annual giving accounted for less than a fifth of all donations, and contributions from corporations and foundations accounted for 24.1 percent.

For every dollar spent on fundraising programs, the median return on investment was $3.22 in fiscal 2012, down 2 cents from fiscal 2011.

The cost to raise a dollar was flat at a median of 31 cents.

Among all institutions surveyed, roughly 25 percent of funds contributed were used to pay for construction and renovation projects, compared to 21 percent for patient care programs, 12.9 percent for capital equipment purchases, and 10.8 percent for  general operations.

At teaching and academic hospitals and children’s hospitals, 16 cents for every dollar raised went toward medical research, compared to less than 6 cents per dollar among all institutions surveyed.

Among all institutions, 4.2 percent of donations, on average, were spent on charitable care, compared to 10.3 percent at children’s hospitals, 5.5 percent at tertiary hospitals, and 4.4 percent at community hospitals.

Todd Cohen

Giving to health care grows

Donations to U.S. nonprofit hospitals and health care systems grew 8.2 percent to $8.94 billion in fiscal 2011, while the cost of raising those dollars hovered near post-recession highs, a new report says.

The total raised in cash plus pledges was up 4 percent from $8.59 billion in fiscal 2008, the previous record-high set before the economy collapsed, and represented the second year of growth since fiscal 2009, went it fell to $7.64 billion, says the AHP Report on Giving from the Association for Healthcare Philanthropy.

Cash accounted for 71.2 percent of the funds raised in fiscal  2011, down from 75.1 percent in fiscal 2010, while pledges represented 28.8 percent, says the report, based on a web-based survey that generated 469 usable responses in April.

The number of donors grew over 2 percent in fiscal 2011, while the number of gifts grew 4 percent.

Institutions responding to the survey raised a median $3.24 for each dollar spent, up 19 cents from fiscal 2010, with academic institutions raising a median $7.58 per dollar spent, the highest of any subgroup.

The overall return on investment was down from $4.22 raised per dollar spent in fiscal 2004 and $4.17 in fiscal 2006.

Fundraising costs grew less than 3 percent in fiscal 2011, down slightly from an increase of 4 percent in fiscal 2010

The cost to raise a dollar fell to 31 cents, down 2 cents from fiscal 2010 but still above the pre-recession level of 29 cents in fiscal 2007.

Fundraising productivity higher at bigger organizations.

Organizations with seven or more full-time employees raised a median $4.33 for each dollar spent, compared to $2.60 for those with only one employee.

Organizations that were 10 to 15 years old raised a median $4.40 for each dollar spent, compared to $3.22 for programs older than 15 years old, and $1.77 for programs five years old or younger.

Philanthropic resources most often funded construction and renovations, equipment purchases and general operations.

Community benefit programs and charitable care received nearly 19 percent of all donated dollars, compared to 8 percent for research and teaching.

Todd Cohen