Charitable giving has taken a significant downturn for the nation’s charity hospitals, as individual donations of at least $1 million to not-for-profit facilities in the first three months of 2007 are down 35 percent from the same period last year.
Factors such as the economy and last year’s strength in donations could be reasons behind the decline, said William McGinly, president and CEO of the Association for Healthcare Philanthropy. The organization represents not-for-profit hospitals and consists of 4,550 members in 2,200 institutions nationwide.
The strength of the economy traditionally has had the largest influence on charitable giving to healthcare organizations, and because the nation’s economy remains strong, giving may increase during the rest of the year, McGinly said. Since 1984, there have only been two years – 1987 and 2002 – in which healthcare philanthropy did not increase.
Overall donations to hospitals rose by 16 percent in 2006, to nearly $7.1 billion, McGinly said.
Philanthropy helps not-for-profits in areas such as charity care, construction projects and information technology implementations.
“The encouraging thing for us is we’re seeing much larger donations going to providers,” he said. The largest hospital donation ever made occurred just months ago when T. Denny Sanford, CEO of United National Corp., gave $400 million to the Sioux Falls, S.D.-based Sioux Valley Hospitals and Health System.
Michael Kittoe, chief financial officer for Delnor Community Hospital in Geneva, Ill., said his hospital receives most of its donations through specific campaigns.
“Right now we have a sophisticated medicine campaign that’s shooting for $10 million,” he said. “We’re at the $4 million mark already, and we’re spreading that campaign over two more years.”
While the majority of financial gifts to the hospital are designated funds, Kittoe said Delnor occasionally receives gifts with no specified destination. Such gifts are typically used for construction or new programs, he said.
Delnor receives about $1.5 million annually in donations. “We’re in a growing community,” he said. “As our community grows, we hope to grow (philanthropy) with it.”