More than $8.9 billion was donated to non-profit hospitals and healthcare systems in 2011 — an all-time high. According to a report from the Association for Healthcare Philanthropy (AHP), that is an 8.2 percent increase over the previous year. The recent numbers continue a trend that started in 2010 when non-profit hospitals saw an eight percent rise in donations compared with 2009 to more than $8 billion. Individual donations totaled nearly 60 percent of that amount, according to the AHP. That was a significant increase over 2009, when donations fell 11 percent or $944 million.
During 2011, the cost of fundraising rose to 31 cents per dollar collected, a two percent rise over the previous year. Healthcare systems raised $3.24 for every dollar they spent. University-connected hospitals were the most prolific, with $7.58 raised for each dollar spent. Approximately 19 percent of donated funds supported community benefits and charity care; an additional 8.6 percent funded training and research.
Annual giving was the primary fundraising source, followed by capital campaigns and special events. Approximately 70 percent of money raised was in the form of cash contributions, while the remainder was pledges primarily in the form of bequests and planned gifts.
Susan J. Doliner, chair of the AHP board of directors, notes that “It’s interesting to see that the funds raised continue to be predominantly in support of construction and renovations, equipment and program operations. Stay tuned, as this finding shines a light on the future gap in resources healthcare organizations will face as we begin the implementation of new healthcare financing models.” The uptick in donations is good news for hospitals and healthcare systems working to accommodate millions of new patients when the Patient Protection and Affordable Care Act (ACA) becomes fully effective in 2014. At present, healthcare systems are relying on capital campaigns to finance new construction rather than bank loans or other debt. Only 17 percent are using debt, a decline from the 20 percent reported in 2010. Another 42 percent are financing new facilities with cash reserves. The use of tax-free bonds is at its lowest level in six years, comprising just 21 percent of new construction financing.