Strategic approach to giving maximizes benefit to practices, communities

Medical Group Management Marketer's Guidepost, Vol. 11, No. 4, July/August 2000

By Jeanan Yasiri, FACMPE, MGMA member

When it comes to charitable requests, any time of year is considered the "giving season" to not-for-profit agencies and community projects in need of support. But for practices who want to go beyond providing excellent patient care and be a truly valuable corporate citizen, the issue of charitable giving is fraught with questions: To whom should your practice donate funds, why and how?

Establishing guidelines for your practice's charitable giving can help answer these questions and focus the giving where it provides the greatest good.

"Our goal in medicine is to provide a service to the community," said Allen D. Kemp, M.D., CEO and chairman of the board, Dean Health System, Madison, Wis. "Beyond the service we provide patients, we have a responsibility to figure out a methodology as to how to help our community by being a good corporate citizen."

The American Benefactor reports that, when considering cash contributions, American corporations allocate, on average, only 1.3 percent of their pretax earnings for charitable ends.

But be assured: Community members and stakeholders are paying attention to who is sponsoring and underwriting community activities, and many are making their spending choices accordingly. In fact, a recent Cone/Roper survey found that 78 percent of consumers are more likely to do business with a company that contributes to a cause they deem important. Clearly, your practice's inclination - or lack thereof - to support its community can have important bottom-line implications.

Adopt a charitable giving strategy

In light of the importance of charitable giving, it's a mistake to dive in before establishing a clear strategy for allocating funds and reviewing requests for assistance.

"You should plan out your practice's charitable giving and carry it out consistently," said Tom Blinn, CEO, Sutter Medical Foundation, Sacramento, Calif. "Outline a plan every year of what the spectrum of contributions should be and then give accordingly. This allows you to see the universe of asking, appreciate it and provide discipline to yourself to give where it will have the greatest benefit."

Also keep in mind the more global benefits of charitable contributions, beyond public relations.

"Providing charitable contributions certainly has ties to public relations and marketing, but realize that giving also is an essential part of being an effective member of the network of community leaders who are addressing the needs of the population," Blinn said. "Charitable giving should be strategic in all its avenues. It helps you to integrate with and lead the community."

Establishing charitable giving guidelines also can help in achieving necessary consistency when saying "yes" and "no".

Making the decisions

With so many causes needing support, what is reasonable to target? As a health care provider, should you focus solely on health-related causes and the organizations promoting them?

For Dean Health System, the answer is no, said Kemp. "We feel that we need to support different charitable ventures if we are going to be responsible corporate citizens. These are organizations that sometimes indirectly impact public health, such as the YWCA or neighborhood clubs promoting after-school activities for children."

While some groups designate an administrator or marketing person to regularly review charitable requests, more organizations are increasingly using a rotating group of employees to review requests. This approach allows staff to learn about the needs of their community and feel engaged in the process of giving on behalf of their organization. Such "giving councils" are most effective when established guidelines are in place.

Establishing guidelines

The process of establishing charitable giving guidelines should include soliciting input from all appropriate facets of your organization. A survey of your group's physicians, staff and administrators can help hone in on categories worthy of support.

Additionally, interviews with local support agencies such as United Way chapters can help your organization identify community needs that are worthy of contributions but otherwise might not have been considered.

Guidelines should provide a balance of definition and elbow room so that those making the tough decisions have something to point to, particularly when they have to say "no."

"You have to learn to balance it," said Blinn. "Do churches need community resources? Yes, they do. However, they can also be helped by manpower, and in a group practice with employees and patients of all faiths, you can usually find people to step forward."

Another example is youth sports teams seeking sponsorship. Blinn recommends giving to the community league as opposed to individual teams, which is a good way to contribute to the cause rather than to one individual or unique interest.

Guidelines also should be written in a format that can be presented to interested organizations so they can review whether their "ask" is a good fit for your organization. That means including language about what you won't consider as well as what you will.

Tracking progress

Once you have your guidelines established and review committee in place, tracking where the dollars are donated is a great way to help everyone in your organization realize the impact of the practice's donations.

How you categorize your organization's charitable giving is a question of what you are hoping to achieve. For instance, if your organization wants to see the populations its contributions are serving, the following categories may work well:

  • serving health organizations that provide services;
  • serving disease-specific organizations;
  • serving the needs of socioeconomically challenged patients;
  • serving community-based organizations with no particular health focus; and
  • serving needs related to cultural and language issues.

If you are more interested in determining exactly for what functions the dollars are used, categories might be listed as follows:

  • services to youth;
  • services to the elderly;
  • health education materials (such as newsletters, brochures and videos);
  • registration/seminar sponsorships for professional development;
  • walks, runs, golf tournaments and other charitable events; and
  • community dinners and fundraising functions.

White charitable giving may be just one piece of service your group provides, never discount the impact of a generous donation to agencies trying to improve the quality of life in our communities. Your organization can become an integral part of that quality component with a process that reviews appropriate applications and make contributions wisely.

Sample charitable giving policy

The following sample language can be used or adapted when establishing your practice's charitable giving guidelines:

(Organizational name) will consider requests for annual donations to projects that coincide with and compliment the stated efforts of (organizational name) service goals, as identified in its mission statement. These goals include addressing the health needs of the communities we serve, as well as working to improve the health status of those communities.

Project requirements
Projects with the following elements will be given greatest consideration:
1) Organizations submitting applications that are non-profit, exempt from federal taxes under 501 (c)(3) of the Internal Revenue Code;
2) Projects must serve the regional area served by (organization name); and
3) Projects must be consistent with the mission of (organization name).

Application review criteria
Project requests will be reviewed based on the proposal's merit and potential impact on the community. Greater consideration will be given to projects that promote public health and education through preventive measures and work with populations in which the greatest degree of impact can be realized.

Application deadlines
While requests are accepted throughout the calendar year, the following schedule will be observed:

Requests submittedOctober 31 - January 1
January 2 - April 1
April 2 - July 1
July 31 - October 1
Decision made byJanuary 30
April 30
July 30
October 30

Projects that will be given less consideration 
1) Sponsorship for teams or individuals participating in races, athletic events or pageants;
2) Travel expenses; and
3) Requests for funds that are intended for:

  • individuals;
  • endowments;
  • debt retirement;
  • political or lobbying efforts; and
  • religious organizations for religious purposes.

When submitting a request for a contribution

  • Please include a typed letter on organization letterhead, signed by a member of the organization's administrative staff or board;
  • The request must clearly identify its purpose, including any event dates, locations, estimate of attendance and how the donation will be noted in printed or other media; and
  • The request should include a timeline for the project and its completion, as well as specific details as to how the donation will be used. Also, please include a list of other secured donors.