Patients Beware: Hospitals Seek Donations from Patients

Nonprofit hospitals across the United States are seeking donations from the people who rely on them most: their patients.

Many hospitals conduct nightly wealth screenings — using software that culls public data sauch as property records, contributions to political campaigns and other charities — to gauge which patients are most likely to be the source of large donations.

Those who seem promising targets for fundraising may receive a visit from a hospital executive in their rooms, as well as extra amenities like a bathrobe or a nicer waiting area for their families.

Some hospitals train doctors and nurses to identify patients who have expressed gratitude for their care, and then put the patients in touch with staff fundraisers.

These various tactics, part of a strategy known as “grateful patient programs,” make some people uncomfortable. “Wealth screenings strike me as unseemly but not illegal or unethical,” said Arthur Caplan, a bioethicist at the New York University School of Medicine.

Mark Rothstein, a bioethics professor at the University of Louisville, said, “Getting physicians involved in philanthropy is something fraught with danger.” He added that it could make patients worry that their care might be affected by whether they made a donation.

Despite such concerns, these practices are becoming commonplace, particularly among the largest nonprofit hospitals. A 2016 survey of 108 hospitals found that 68 had grateful patient programs, according to the Advisory Board, a consulting firm.

Commonplace practices

“In the last 10 years we’ve seen a pretty dramatic uptick in strategic attention in the formation of these programs,” said Nicholas Cericola, a senior consultant with the firm.

Large hospitals that say they screen patients’ wealth include those run by MedStar Health in Columbia, Md.; the Johns Hopkins Hospital in Baltimore; Cedars-Sinai in Los Angeles; and NYU Langone Medical Center in New York.

Donations from patients and their families supplement income streams from private and public insurance programs as well as money raised through traditional methods like charity golf tournaments, dinners or gala balls.

“It’s a way to get money to the hospital’s bottom line like nothing else they are doing,” said Bill Tedesco, chief executive officer of DonorSearch, a Maryland company that supplies hospitals with software that helps them conduct wealth screenings.

‘Get-To-Know-You Opportunity’

Patients and their families were responsible for two-thirds of the $34 million donated to the Sharp HealthCare hospital system in San Diego last year, said Bill Littlejohn, chief executive officer of the system’s fundraising foundation.

Wealth screening and the participation of the hospital’s doctors are crucial, Littlejohn said. Sharp screens up to 400 patients each night, he said, and adds about 10 to 20 to its database of potential donors.

When he approaches wealthy patients in the hospital, they are unlikely to know that they were selected with the aid of the wealth screening, according to Littlejohn.

“I’m not asking them for money, but I tell them we appreciate them choosing Sharp and hope they have a wonderful experience,” he said. “I use this as a get-to-know-you opportunity and let them know Sharp is a nonprofit and philanthropic-supported institution.”

Littlejohn estimates that doctors prompted 20 percent of patient donations through conversations with their own patients. The practice has helped Sharp triple its annual fundraising totals from a decade ago, he said.

Nationwide, donations to hospitals exceeded $10.4 billion in 2017, up from $6 billion in 2004, according to the Association for Healthcare Philanthropy.

“Grateful patients have always been there, but we did not always do as good a job of inviting them to be part of our missions as we are now doing,” Alice Ayres, the trade group’s chief executive officer, said. She attributed the increased fundraising to grateful patients programs as well as to a shift away from event-driven efforts, a focus on larger gifts and overall economic growth in the United States.

Change In Privacy Law Facilitates Fundraising

A 2013 change in federal health privacy law made it easier for hospitals to target their patients for donations. It enabled hospital records departments to share with staff fundraisers some personal details of patients, including their health insurance status, the department treating them, the name of their physician and the outcome of their care.

When patients are admitted, they typically sign a raft of papers that include permission for the hospital to use this information for fundraising. While the 2013 law required hospitals to inform patients that they could decline to be solicited by fundraisers, few patients are aware of this, said Deven McGraw, a former deputy director of health information privacy at the federal Department of Health and Human Services. And, she said, few appear to realize that their wealth may be assessed for fundraising.

Many hospitals send solicitation letters to all of their insured patients, including those with little desire — or ability — to make donations.

St. Clair Hospital in Pittsburgh treated Marcy Grupp in its emergency room for three hours in May for a painful kidney stone, providing a computerized tomography scan, among other tests. Medicare paid the bill.

A month later, the hospital sent Grupp, a retired television engineer, a letter asking for a donation to honor a doctor or other caregiver. “We encourage you to please consider honoring their efforts with a ‘gift of gratitude,’ by making a donation to St. Clair Hospital,” the letter said.

Grupp, 66, said she wasn’t rich, and was disturbed by the letter.

“I kind of resent it,” she said. “I don’t think they need the money.” The hospital last year reported nearly $48 million in net income and paid its chief executive officer $1 million.

“I thought the care I got was good and the doctors I had were good, but I don’t see why I need to pay in addition to what I’ve already paid,” Grupp said. St. Clair executives declined to comment.

Doctors not rewarded

Dr. Patricia Lech, a retired surgeon, underwent a successful joint replacement operation at New England Baptist Hospital in Boston in August 2017. Several months later, she received a letter from the hospital asking her to make a donation to honor one of her doctors.

Lech, 58, said the letter had left the impression that her doctor would directly benefit from the donation, which was not the case. “I did not like the implication that doctors would get rewarded when they really aren’t,” she said.

Morgan Herman, vice president of philanthropy at New England Baptist, acknowledged that the hospital solicited former patients but said that did not affect patient care. “There is no connection,” she said.

Unease Among Doctors

Many doctors are uneasy about being asked to help raise money from their patients, studies show.

“It makes doctors very uncomfortable for a lot of reasons — No. 1 is that the doctor is there to see the patient for a problem they have and not to ask the patient for money,” said Dr. Rosalyn Stewart, an internist at Johns Hopkins who has researched physician attitudes at Hopkins toward the practice.

She said she worried that if a wealthy patient made a large donation, doctors would feel obligated to treat them differently, perhaps by returning their calls more quickly.

“I feel like the risk is we are setting up a two-tiered health care system — one for wealthy patients and one for everyone else,” Stewart said.

While wealth screenings have been used for decades for fundraising by universities and other nonprofits, ethicists said they raised different concerns for hospitals.

“Needing health care is different than choosing to go to college or going to the opera,” said Nancy Berlinger, a bioethicist with the Hastings Center, a think tank in Garrison, N.Y. “When you are sick, you need a trusting relationship to be formed and focused on your health. There is a vulnerability there that is not present in other nonprofits.”

Dr. Frederick Finelli, a surgeon and the vice president of medical affairs at MedStar Health’s Montgomery Medical Center in Maryland, said that while he used to feel uncertain about fundraising, he now saw it as part of the healing process.

“When someone says ‘Thanks’ to me, it feels incomplete for me to just tell them, ‘No problem’ or ‘I was just doing my job,’” he said. “Talking to patients about philanthropic or volunteer needs is good for patients.”

And some are happy

Some patients say they are happy that they were asked for money.

For example, Martin Faga, 77, was treated at Inova Fairfax Hospital in Virginia last year for serious heart problems. A retired president of Mitre, a large nonprofit federal contactor, Faga repeatedly praised his bedside nurses for their care, he said.

When one of those nurses sent an email about this to Mary Myers, a hospital fundraiser, she visited Faga’s room to chat about the role of philanthropy and arranged to meet him at his home a few weeks later, Myers said.

Faga wasn’t initially interested in making a large donation, he said, because he didn’t believe that the nonprofit health system — the largest in Northern Virginia, with five hospitals and $3 billion in annual revenue in 2016 — needed the money. But he said he had changed his mind after Myers told him that such donations were essential for staff training and buying equipment, and has donated $200,000 to the hospital.

“I would still have been in the small-donation category of a couple hundred dollars if not for Mary and the educational process,” he said.

Kaiser Health News is a nonprofit news service covering health issues. It is an editorially independent program of the Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.