Brandywine Health and Wellness Foundation
Moving Forward Following a Change in Health Foundations Trends
The early 1980s marked the emergence of new health conversion foundations and the trend has continued unabated. As many nonprofit hospitals and health systems began to experience serious financial problems, they saw the conversion to for-profit status or sale to a for-profit entity as an opportunity to remain solvent.
When an existing nonprofit health care organization becomes a for-profit entity through a sale, merger, joint venture, or corporate restructuring, federal and most state laws require that the value of its assets remain in "the charitable stream." This means that the nonprofit assets are transferred to another nonprofit organization that is mandated to carry out the original purpose of the hospital or health plan as closely as possible. In most cases, a new foundation is created to accomplish this goal.
A 2003 survey by Grantmakers in Health identified 165 new health foundations with a reported total of just over $16.4 billion in revenue, an increase from the $15.3 billion reported in 2002.
When the Brandywine Hospital of Coatsville, Pennsylvania was sold to Community Health Systems in 2001, the Board was faced with the challenge of maintaining the charitable purpose of the proceeds by creating a health conversion foundation. Aware of the TCC Group's expertise in the area of philanthropy, the transition board asked TCC to help plan for the new foundation.
Using Comparative Data to Strategize
Initially, TCC advised the transition team on the fundamentals of creating a new foundation, drafting by-laws, creating a mission statement, and recruiting a new Board. TCC researched the experience of other new conversion foundations and analyzed best practices in the field. The transition team was committed to maintaining the health focus of the funds and created the Brandywine Health and Wellness Foundation in late 2002.
TCC met with newly recruited Board members and interim staff to discuss their new responsibilities and the development of a new grantmaking program. The foundation's service area overlapped that of the hospital making the prospect of providing complementary services appealing. TCC undertook an abbreviated needs assessment to help the Board gain a better understanding of the health and welfare needs of the Coastville/Downington community.
TCC gathered census and other health related data, interviewed a small sample of community leaders and prepared a synopsis of current service providers. The findings helped the new Board begin to focus their discussion on how best to use the foundation's resources.
The final step in the process was the recruitment of a new President and CEO. TCC conducted a national search to identify an appropriate individual to lead the Foundation. In early 2002, the new President took over the reigns of the Foundation.
Effective results through Research and Experience
In 2003, after only its first year in operation, Brandywine Health and Wellness Foundation planned to distribute approximately $370,000 to new programs and for the expansion of existing effective programs focused on improving the health and well-being of the community.
