CEO Corner: Some Hope for the Road Ahead
Photo by Ravi Roshan on Unsplash
So much recent news has focused on tragedy that I want to take a few minutes to give you a bit of hope for the future of our industry. Much has been written about the dire financial situation at many hospitals and health systems. But healthcare institutions, and healthcare philanthropy, have weathered other crises and come out stronger on the other side. I am confident that we will do the same in this one.
We can take hope from the experience of healthcare philanthropy in the aftermath of the financial crisis of 2008. While giving in healthcare declined in 2008 and 2009 as the financial crisis took hold, total funds raised increased meaningfully over the next two years. By 2011 total giving had again surpassed 2007 levels.
Donors recognize the value of healthcare, even when the chips are down—maybe especially then. With these figures in mind, there is reason to be optimistic for healthcare philanthropy during Covid 19, particularly since the pandemic is shining a light on how vital our medical institutions are.
Early results bear that theory out. Our Covid 19 benchmarking survey revealed that among AHP members both major gifts (greater than $10,000) and annual gifts (less than $10,000) surged in March. Though major gifts returned to normal levels the next month, the increase in annual giving was sustained through April and May. This will be an intriguing trend to follow over time and is an excellent opportunity for fundraisers to turn one-time donors into repeat donors with strong stewardship and follow-up.
Even if we go on to see a decline in healthcare giving, commensurate with overall declines in giving, as people struggle through the fallout from major events, healthcare is a mainstay in society. Recent research has shown that American donors want to support hospitals, health causes, and social services more than education and environmental causes.
Faced with shrinking margins, hospitals are facing a critical need to diversify revenue sources to increase revenue right now and safeguard hospitals for the future. Philanthropy is well positioned to help fulfill this obligation.
The potential returns are significant and well-known to all in the profession but worth repeating now more than ever: Every dollar invested in the philanthropy team and their work generates four dollars in revenue. It takes as much as $100 in patient revenue to deliver the same net revenue as $1 raised in charitable gifts. That means that hospitals would need $75 million in patient revenue to deliver the same net impact as $1 million in charitable giving.
Of course, there are plenty of unknowns to contend with: the duration of the pandemic, the potential for an economic depression, stock market volatility, consumers’ appetite to resume non-emergency care. But the opportunity for us to make a difference to the healthcare of our nations is real, and AHP are here to serve you in that pursuit. We have an abundance of resources at your disposal, including our new AHPrime membership, and a team ready and willing to help you anytime you need it.