We'll say it again: The growth in the number of health legacy foundations and their assets is one of the biggest stories in philanthropy right now.
There are now over 230 of these grantmakers, which are also known as health conversion foundations because they're created when nonprofit health providers are sold to for-profit companies. We’ve been reporting on them a lot lately because these emerging powerhouses have become more dominant in health grantmaking and are playing larger roles in local funding ecosystems, especially in places off the beaten track where there aren't a lot of other foundations. In addition to making waves on their own regional giving scenes, health legacy foundations are stepping into new territory with policy and advocacy efforts. Some have also been on the forefront of growing efforts to address the social determinants of health with "upstream" funding efforts in areas like housing, food systems, and transportation.
One striking thing about these institutions is that they can appear suddenly, with big resources and big ramifications for nonprofits.
A case in point is the brand-new Mother Cabrini Health Foundation (MCHF), which was recently announced by the Archbishop of New York, Cardinal Timothy Dolan. With $3.2 billion in assets already at its disposal, the foundation is expected to make $150 million in grants annually. Not only will MCHF be the largest foundation solely focused on the state of New York, it will be the nation's second biggest health legacy foundation after the California Endowment.
Like most health legacy foundations, this one began with the sale of a nonprofit health entity (Fidelis Care) to a for-profit company (Centene Corporation). The selling price was $3.75 billion, and that deal was sealed last September. Centene is the largest Medicaid managed care plan provider in the country.
Rooted in Catholic traditions, the new foundation was named after Sister Frances Xavier Cabrini, who lived in the late 1800s and early 1900s, and advocated for children and immigrants. She was also the first American citizen ever to be canonized a saint.
Once the sale is officially approved by the New York attorney general’s office and everything is settled, the Mother Cabrini Health Foundation is expected to start grantmaking to New York nonprofits that benefit the health and well-being of the poor and underserved communities. Like many other large healthcare foundations that result from the sale of non-profits, MCHF will focus on addressing social determinants of health that impact New Yorkers from all walks of life in every part of the state.
Cardinal Timothy Dolan said the foundation will "provide assistance to needy New Yorkers of every color, every religion, and every background," and seek to "transform the lives of underserved New Yorkers from all corners of the state and set a national model for addressing the health and wellness needs of low-income communities."
Over time, we've seen that many health legacy foundations tend to interpret their mandates broadly, backing social justice and advocacy work to build "healthy communities," as the California Endowment describes its mission. Grants from that foundation flow not just for traditional health work, but to nonprofits working on education, violence prevention, youth empowerment, immigrant rights, and more.
New York's Catholic leadership tends to be politically moderate, so we don't expect to MCHF to become a leading social justice funder any time soon. But health legacy foundations seem to have a way of migrating left over time.
As with many of these big health insurance deals, the Fidelis/Centene sale isn’t without its share of controversy. The news of this sale comes after corporate execs and local bishops agreed to pay $2 billion to balance the New York City budget, sparking accusations of too much government control over healthcare organization sales and deals.
The Mother Cabrini Health Foundation does not yet have a website set up to tell us more about its grant strategy or how its very first grant opportunity will look. Stay tuned for further developments as this huge new foundation gets off the ground and starts sending out millions to New York nonprofits.