HOSPITALS AND HEALTH CENTERS

Overview

When hospital fundraisers reach out to individual donors, these donors are often approached with specific projects in need of funding, like a new recovery room or ambulance bay.

Many donors make substantial gifts on their own. With so many different variables in this giving space, it’s difficult to find any common denominators without looking back a few years. A recent study by the Association for Healthcare Philanthropy demonstrated that the more fundraisers a health institution employs, the more money they will raise.

Here at IP, we have reviewed major hospital and health center gifts from individual donors over the past seven years, and are analyzing new gifts nearly every week. This guide explores who's making the gifts, who's getting the money and what strings are attached to how it's spent.

Who’s Giving?

Because this area of individual giving is so varied and involves billions of dollars, it’s best to examine these large gifts by geographic region.

Over the time period we analyzed, 2008-2015, the most generous individual donors to hospitals and health centers were based in the western region of the United States, followed by the northeast and the midwest.

There are a number of reasons giving to hospitals and health centers is concentrated in the West and Northeast, chief among them being the higher concentrations of individual wealth in these regions.

The backgrounds of these donors are mixed. Individual gifts to hospitals don’t necessary follow the same patterns of giving as those to mental health or brain research, for example. That said, there are detectable patterns in this giving space.

We can trace most of the giving toward hospitals and health centers to fortunes made in finance and real estate. Individual donors with family wealth also make a strong appearance, as do those who earned their fortunes in manufacturing. Young tech billionaires, most of whom live out west and have built their fortunes fast, are all but absent from our long list of individual donors giving to hospitals and health centers around the country.

Young is the operative word here. Mark Zuckerberg and other tech philanthropists of a similar age aren't paying much attention to hospitals and health centers, but their older predecessors in the tech world do make our list. (Check out our Tech Philanthopy Guide to find out which tech billionaires are among the most generous).

Who's Getting?

Small hospitals largely unknown outside the communities they serve, like Christus Santa Rosa Health Systems, are getting $1 million-plus checks alongside healthcare giants like the Mayo Clinic. Of course, Christus Santa Rosa isn’t receiving the $100 million checks that Mayo receives, but the gifts are pretty comparable when considering the size and scale of each health system.

In the world of gifts to hospitals and health centers, gifts in the $50 - $100 million range occur with surprising regularity — at the very least, once or twice a year. Some individual donors are responsible for more than one mega gift in the same year.

David Koch recently gave $150 million to Memorial Sloan Kettering Cancer Center (MSK) in New York City, where he's been a member of the board of trustees for decades. The $150 million is the largest charitable donation in his and the center’s history, and will build a state-of-the-art outpatient medical facility to be known as the David H. Koch Center for Cancer Care.

T. Denny Sanford gave $100 million to what is now known as Sanford Health in Sioux Falls, South Dakota. This wasn't a gift pledged over time or a bequeathment — this was $100 million flowing directly into the South Dakota healh system. Prior to that, Sanford gave $50 million to the Sanford-Burnham Institute in Santa Barbara, California. This donation was made on a tight five year installment plan.

When analyzing gifts of $50 - $100 million, one name came up again and again: A.B. Hudson, the now deceased Kansas based oil tycoon. Hudson gave the Shriners Hospital for Children in Tampa, Florida $50 million, and then turned around the next year and gave the Shriners Hospital for Children in Cincinnati $60 million. Hudson was a lifelong member of the Shriners.

Additional individual donations in the $50 - $100 million range include a $60 million pledge from Jack and Barbara Nicklaus which renamed the Miami Children's Hospital, the Nicklaus Children's Hospital (NCH).

Bumping down a notch into the $25 - $50 million range, Conrad Prebys, who makes multiple appearances on our major donor list, gifted Scripps Health, San Diego, $45 million for the construction of a new cardiovascular institute. Subway Restaurant founder Peter Buck gave $30 million to Danbury Hospital.

Individuals writing checks for $10 to $25 million have the highest totals in terms of the number of donations made. Here are a few examples: 

  • Steven and Alexandra Cohen gave $15 million to the Stamford Hospital Foundation, for the establishment of the Cohen Children’s Institute.
  • Steven and Alexandra Cohen gave $15 million to the Stamford Hospital Foundation, for the establishment of the Cohen Children’s Institute.
  • Iris Cantor gave New York Presbyterian Hospital $20 million toward the establishment of a comprehensive medical center for men.
  • William and Sue Gross gave Cedars-Sinai, Los Angeles, $20 million toward its new Advanced Health Sciences Pavilion.

Gifts of less than $10 million follow much of the same giving pattern as those over that amount. It comes as no shocker that the vast majority of all individual giving to hospitals and health centers fall below the $10 million mark. However, giving toward pediatrics deviates slightly from this pattern. Over the period we analyzed, we discovered that in every major category of giving to hospitals and health centers, around 80% of the checks written were for under $10 million. But when it comes to pediatrics, approximately 55% of gifts were for $10 million and above.

How the Gifts Happen

When it comes to fundraising for hospitals and health centers, it’s generally the development executives that are doing the heavy lifting. If a particular donor expresses interest in a specific area of study or medical discipline within the hospital, heads of those departments join the relationship-building process.

As far as eight and nine figure gifts are concerned, the big guns, such as presidents and board chairs, are leading the donor cultivation process. In some cases, donors give massive gifts that are totally unsolicited. Often these gifts emerge from a personal connection to the hospital or health center to which they are giving.

What are the Gifts for?

Individual donors fund construction, expansion and renovation projects most heavily. The majority of those donations earmarked for construction went toward adding new centers onto existing hospitals or health centers. For example, Louis and Peaches Owens donated $18 million to Mother Frances Hospital in Tyler, Texas toward construction of a freestanding cardiac hospital on the Mother Frances campus. William and Marilynn Scully made a similar donation, giving Indian River Medical Foundation in Vero Beach, Florida, $12 million toward the construction of a new cancer center.

Other common construction projects include patient and surgical pavilions as well as new facilities for specific practices, such as clinical sciences and rehabilitation. George Schaeffer recently gave $12 million to Cedars-Sinai, Los Angeles, to support the construction of its new advanced health sciences pavilion. Another example is Jack and Mary Breen’s $5 million donation to University Hospitals in Cleveland toward the construction of a new breast health center.

Improving emergency centers and departments are also a high priority with individual donors supporting construction at hospitals and health centers. When it comes to the new construction of condition-specific facilities, cancer and cardiac centers receive the most attention from individual donors.

Pediatrics also fare well with individual donors. The majority of gifts supporting pediatrics go toward the consruction of new pediatric hospitals and centers. Here are a few recent examples: 

  • Ira Druckier and his wife Gale recently gave $25 million to Weill Cornell Medical College to establish the Gale and Ira Drukier Institute for Children’s Health.
  • Tom Golisano gave the Children’s Hospital of Southwest Florida $40 million for the construction of a new hospital.
  • John and Marion Anderson gave Children’s Hospital, Los Angeles $50 million toward the construction of a new state-of-the-art hospital building.
  • Steven and Alexandra Cohen gave $15 million to the Stamford Hospital Foundation, for the establishment of the Cohen Children’s Institute. Past gifts by the Cohens a $55 million gift to expand pediatric care at the Long Island Jewish Medical and North Shore University Hospital.

Specific pediatric programs receive attention too, though no one program is an especially popular target for donors. Major gifts went toward gastrointestinal motility, pediatric organ transplant, and fetal heart programs, among other programs.

The third most heavily funded area for hospitals and health centers is the support of specific programs within existing institutions. There isn’t an overwhelming pattern of funding favorites when it comes to program support, but cardiology, oncology and women’s health programs receive individual donations more regularly than other program-related gifts. Take a look: 

  • James and Ruth Clark gave Cape Cod Health Care Foundation $10 million toward the support of an oncology center at Falmouth Hospital.
  • Christine E. Lynn gave $10 million to Boca Raton Regional Hospital’s Women’s Health & Wellness Institute
  • Barry Diller, Diane von Furstenberg, Barbara Streisand, Michael Bloomberg, Ralph Lauren, Irwin Jacobs and others gave Cedars-Sinai, Los Angeles, $1 million each toward its Women’s Heart Center. 

The remaining individual donations went toward capital campaigns, chair endowments, unrestricted funds, and equipment purchases. These areas combined represent around one-quarter of total giving to hospitals and health centers. Donations toward equipment purchases received the least amount of attention from individual donors.

What Strings Are Attached

Surprisingly, individual gifts to hospitals and health centers rarely come with conditions attached. The naming of new buildings is common, but isn’t a hard and fast rule. Chair endowments, however, nearly always bear the name of the donor. Of course, the exception to the naming rule is if the donors made their gifts specifically for naming rights. Though this does occur, gifts for specific naming rights is uncommon, and does not represent a large percentage of individual giving to hospitals and health centers overall. Of the over $3 billion in gifts analyzed, around $19 million went toward naming buildings, pavilions and hospital wings.

Something that is worth mentioning regarding conditions attached to individual gifts to hospitals and health centers is that many of the larger gifts are pledges that are doled out over a defined period of time, typically between five and ten years.

Insights & Tips

As a general rule of thumb, individual donors tend to give to hospitals and health centers located in their home states. Big donors give outside of their home states less than 10% of the time. No matter how or where the individual donor is giving, the recipient of their gift can usually be explained by one of two reasons. 

The first reason is that the hospital or health center holds some type of personal significance to them. Many individual donors received treatment from recipient hospitals. For example, Fred Bering, who now lives in California, fled Nazi Germany for the US, landing in Connecticut. Bering left his father, whom he would never see again, when moving from his homestate to the warmer climes of California. He received a letter from his father stating, “If you should ever find yourself in a position where you have more than you need, think of those who are less fortunate.” This prompted Bering to give Danbury Hospital $2 million. Here are a few other examples of individual giving along these same lines: 

  • Irene Pollin, who donated $10 million to the Johns Hopkins Ciccarone Center for the Prevention of Heart Disease, lost two children to congenital heart defects.
  • Conrad Prebys gave $45 million to Scripps Memorial Cardiovascular Institute. It's likely Prebys chose to give to a cardiovascular institution because as a child he contracted a cardiovascular infection and was bedridden for a year.

The second major reason individual donors give is to support prominent facilities — like Mayo, Cleveland Clinic, and Cedars-Sinai. Incidentally, Cedars-Sinai in Los Angeles garnered multiple $1 million donations from high profile individual donors such as Ron Perelman, Michael Bloomberg and Ralph Lauren, largely because Barbara Streisand asked them to. Streisand has been a huge supporter of Cedars-Sinai, LA for a number of years.

The bottom line here is that hospitals and health centers are important to everyone. Success in fundraising for hospitals and health centers tends to start local and branch out from there. (For additional information on fundraising from NGOs, check out IP's Fundraising for Hospitals and Health Centers Guide.)