Health legacy foundations: a new census

Area of Science:

• Health Policy
• Philanthropy
• Healthcare Management

Background:

• Healthcare merger and acquisition activity has surged following the Affordable Care Act's 2010 enactment.
• Nonprofit healthcare transactions generate proceeds that establish philanthropic entities known as health legacy foundations.
• Previous work by Grantmakers In Health provided a foundation for identifying these organizations.

Purpose of the Study:

• To systematically identify and create an updated, comprehensive database of health legacy foundations.
• To analyze the asset distribution, geographic focus, and grant-making patterns of these foundations.

Main Methods:

• Conducted a systematic search to identify health legacy foundations.
• Compiled a comprehensive database of these organizations.
• Analyzed foundation assets, geographic scope, and grant restrictions.

Main Results:

• Identified 306 health legacy foundations across forty-three states endowed by nonprofit healthcare asset restructuring.
• Found total assets of $26.2 billion in 2010, concentrated in the southern US.
• Foundations from hospitals/specialty facilities (86.6%) had mean assets of $64.7 million, typically granting locally. Foundations from health plans (13.4%) had higher mean assets ($222 million), broader scope, and engaged in advocacy.

Conclusions:

• Health legacy foundations represent a significant new source of charitable wealth.
• Future transactions involving smaller nonprofit hospitals are expected to create more such foundations.
• These foundations play a crucial role in distributing charitable resources, with variations based on their origin (hospital vs. health plan).