Private Philanthropy — Another Key to Hospital Financial Stability

By Jim Mahon, PhD

 

If necessity is the mother of invention, then it is time to pay a visit to her cousin, replication – replication, as in borrowing from the higher education playbook in generating more charitable donations from individuals and families.

 

Colleges and universities have traditionally placed a much higher premium on generating both annual and planned gifts than the majority of hospitals. Rather than expounding on the many legitimate reasons why this is the case, let’s focus on steps the Board, the Executive Suite, and the Chief Development Officer (CDO) can take.

 

Step 1: How philanthropic is your culture?

 

According to a survey by the Governance Institute, only 18% of hospital Boards have a written policy outlining individual directors’ responsibilities for supporting the organization’s philanthropic efforts.

·         Is charitable commitment/charitable connection a primary criterion for Board member recruitment and performance?

·         How many trustees have donor-advised funds? Are any of those funds coming to the hospital?

·         What percentage of the Board makes an annual gift, and how many gifts are five figures or more?

·         How many planned gifts have been made by the Board and C-suite? A $10,000 charitable gift annuity can be a reasonable starting point.

·         What percentage of the annual operating budget comes from charitable gifts?

 

Step 2: Have you done an opportunity assessment in the last 2-3 years?

 

Even if you are not conducting a formal campaign, consider one-on-one interviews with your 100-200 most influential constituents. Ascertain their visions for the hospital and their philanthropic commitment to seeing that vision become reality. These interviews will yield a goldmine of opportunities for generating charitable dollars for both current and long-term needs, not to mention some great ideas for new initiatives.

 

Step 3: Is your Chief Development Officer empowered to be a player?

 

A fancy-schmancy title like CEO of the Hospital Foundation means little if your chief fundraiser is perceived as a lieutenant or special events coordinator. The Chief Development Officer at a college or university is usually right up with the Provost or Chief Academic Officer on the power grid. Many higher education Presidents were CDOs in their previous positions. How many hospital CEOs do you know that came by that path?

 

Either empower or hire a CDO that has full access to the Board and the requisite skills to work with Trustees and the C-Suite to create a true culture of philanthropy. The pay-offs will be worth it!

 

Read more about hospital fund development.

 

 

Jim Mahon is a Principal at Compass Group, Inc., and has previously served as a Chief Development Officer in both the higher education and healthcare fields.

 

 

Filed Under: Featured Articles • Financial Performance

Tags: Featured Articles, hospital foundation management, hospital fund development