Donations to Hospitals up by 8% and ROI on Fundraising is Down

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June 14, 2011; Source: Health Leaders Media | The Association for Healthcare Philanthropy just released a report with a wealth of interesting information for the wise and wonky fundraiser. AHP reports that giving to hospitals was $8.2 million in 2010 – up by 8 percent over the 2009 levels. In 2009 giving had, however, dropped by 11 percent from the year before.

More than 60 percent of the 2010 gifts were derived from individuals. What was the money to be used for? According to an AHP spokesperson, 22 percent will fund construction and renovation and 21 percent will go to new and upgraded equipment. Only 18 percent will go to fund general operations but this figure has grown significantly in the last ten years from 7 percent or 8 percent and is expected to grow more as Medicaid and Medicare reimbursements are cut placing more importance on health care groups’ fundraising capacity.

Additionally the report says that the cost to raise a dollar is now approximately 33 cents and return on fundraising investment has declined by 4 percent in 2010. Bottom line says the report: “Fundraising has become more challenging and, therefore, more expensive. Additional resources are needed to raise the same amount of funds during difficult economic times.”

AHP CEO William C. McGinly says that in the context of the slow recovery healthcare organizations with strong philanthropic programs – those that did not make cutbacks that damaged their capacity – will be best positioned to do well over the coming year when he expects the upswing to continue.

In this author’s opinion these numbers are not overwhelmingly promising – with increases in money raised eaten up by decreases in reimbursements and greater costs for raising each dollar, it sounds a little like a Sisyphean situation. We’d love to hear your thoughts. —Ruth McCambridge

  • linda ziskind

    A question to ask the AHP is, are the organizations in their report using the same fundraising strategies and methods that they have always used, or are they exploring innovations in fundraising strategies and incorporating social media? If it’s the former, then the results reported are no surprise.