When the financial markets took a nosedive, so did the Duke Endowment's asset value. And just like the rest of the economy, the Endowment has yet to recover. As a result, the Endowment cut its health-related funding, limiting grants to programs focusing on "essential health services and health care for the uninsured." Programs finding themselves on the short end of Duke's funding stick include community outreach programs and workforce development programs. (See Duke Endowment: Grants for Higher Education).
Endowments, in broad strokes, aren't really that complicated. They begin with a little seed money; in this case, $100,000 from the Duke family. That money is then invested, and guidelines are established regarding how much of the total asset value of the endowment can be spent. Since the endowment is invested in public stock markets, when those markets take a hit — as they have in recent years — the total asset value of the endowment declines. The result is that there are fewer dollars to dole out and funding cuts are made. In Duke's case, it's limited the health care grants it will make to non-profit hospitals, academic health centers, health education centers in the Carolinas and health organizations in counties that do not have an existing non-profit hospital.
Duke Endowment officials haven't stated when or if the funding will be back to its pre-recession levels, only that its health care grants will remain limited until "economic conditions become more favorable." Pre-recession, the Duke Endowment's total asset value was flirting with $3.5 billion. Once the recession was underway, the endowment lost nearly $1 billion in value and continues to struggle with an average of less than five percent investment returns in 2011.
Unfortunately, the best route for those who have lost funding from Duke is to seek it elsewhere. This economic downturn (the Bureau of Labor and Statistics says it ended in 2009) or whatever euphemism politicians want to call it, has grown roots that are long and deep. Though its assets are worth billions, the Duke Endowment just doesn't have the extra money lying around to grant to all of the health care programs it once funded.