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Hospital donations plummet nearly $1 billion

The ripple effect of the economic downturn is seen in charitable giving to hospitals and other institutions in 2009.

By — Posted Oct. 13, 2010

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Donors to hospitals and other health care institutions kept an even tighter hold on their purses and wallets in fiscal 2009 than in 2008, according to the Assn. for Healthcare Philanthropy.

"Whether the recession ended in 2009 is for economists to debate, but its ripple effect certainly continued to curtail the ability of donors to give," said William C. McGinly, PhD, AHP president and chief executive officer. "FY 2009 AHP Report on Giving" was issued on Sept. 27.

Nonprofit medical institutions raised more than $7.6 billion in fiscal 2009, according to AHP. The amount was $944 million less than fiscal 2008 and represented an 11% decline. Donations increased in 2008, when the recession was starting to make an impact, but growth was less than in 2007.

Those raising money for these institutions had to work harder for what they received. In 2008, a dollar spent on fundraising generated $3.51 in donations. In 2009, a dollar expended brought in $3.19.

"This downward trend is a very serious problem," said Gregory Pope, chair of AHP's board and vice president of philanthropy for Saint Thomas Health Services Foundation in Nashville, Tenn.

Declines in charitable giving are not limited to health organizations, according to other reports, but donations most likely will go up as the economy recovers.

A report released June 9 by the Giving USA Foundation found that charitable donations declined 3.6% in 2009. Another by Boston College's Center on Wealth and Philanthropy released May 27 found that giving by individuals decreased 4.9% in 2009, but researchers projected that these donations would increase 3% to 4.5% in 2010.

The majority of AHP members are hospitals, but the association also includes nonprofit health organizations and long-term-care facilities.

In September, the National Bureau of Economic Research reported that the recession that began in December 2007 ended in June 2009. However, it "did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month."

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