Northeast Ohio hospital group creates $15 million charity
When the Center for Health Affair’s Chief Executive Bill Ryan opened an e-mail in October, he paused.
The hospital organization’s investment in a group purchasing organization named Premier had unexpectedly paid off. The e-mail explained in stilted legal language that Premier went public in late September with an initial stock offering that fared better in the market than expected.
Northeast Ohio’s Center for Health Affairs would receive proceeds of $75 million in stock and cash.
What could a small nonprofit do with extra money?
“We clearly wanted to do something meaningful,” Ryan said recently.
Creating a Fund
The Center for Health Affairs is a member organization for Northeast Ohio’s hospitals. Each hospital pays dues to participate. The organization speaks on their behalf and spearheads projects for the community.
Many such member organizations, Ryan said, have struggled financially in recent years. Often they are forced to increase dues, reduce services or even to exist.
The Center for Health Affairs has avoided this fate largely because it has a for-profit branch of business called CHAMPS Healthcare. CHAMPS, which is not an acronym for anything, does some group purchasing, coding work and other administrative duties to bring in revenue.
CHAMPS supports about 50 percent of the organization’s operations, Ryan says.
More than a year ago, CHAMPS purchased a small stake in the North Carolina-based Premier. With some reluctance, the Cleveland-based hospital group agreed.
Ryan said the organization had no involvement in the plans to take Premier public late last year. Ryan called the $75 million and unexpected “windfall.
The Center for Health Affairs board voted to put much of the money back into the organization to expand the business operations. But about $15 million will be funneled in the coming years to a donor-advised fund that provides charity to the community, Ryan said.
“We’re really interested in having an impact in the overall health of the community and also having an impact in the ability for all people to access quality health care and to have better health outcomes,” Ryan said.
Building a Fisher House
The first project, Ryan said, will be to help build a Fisher House.
The Louis Stokes Cleveland VA Medical Center is a member of the Center for Health Affairs and gets an annual visit from Ryan. It was during Ryan’s most recent fall tour, when the idea of donating land to so the hospital could build a Fisher House first took hold.
VA Director Sue Fuehrer was with Ryan on the tour and she recalls his amazement at how busy the hospital was.
“You guys are building, it’s like a little city,” Fuehrer recalls Ryan saying.
The Cleveland VA hospital provides outpatient care for more than 107,000 veterans each year. And the daily inpatient census includes 550 inpatients.
But unlike many Veterans Affairs hospitals, it does not have a place for families from out of town to stay.
So when Ryan asked at the end of his visit whether there was anything he could do to help, Fuehrer said directly, “We don’t have a Fisher House.”
Fisher Houses are facilities at VA centers similar to the more commonly known Ronald McDonald houses attached to private hospitals. They provide a place for family to stay when loved ones are being treated.
Fuehrer said about 600 patients annually travel to the VA from out of state each year. Some stay for weeks and others like those being treated for traumatic brain injury could stay for up to six months.
“For veterans that are coming back, particularly the young veterans from Iraq or Afghanistan that have significant injuries that require significant rehabilitation, having your wife or your husband and your children nearby makes a tremendous difference in your outlook and ability to heal,” Fuehrer said.
Ryan said the new charity’s first project would be to buy the land needed to build a Fisher House. The exact location is still being determined.
The donation couldn’t have come soon enough. The Cleveland VA has been hoping to raise support for a Fisher House for several years. The national organization, which has helped build 62 houses across the U.S. was considering pulling out of the Cleveland project, Fuehrer said.
“They were actually thinking about scrapping this project because we haven’t been able to secure land,” Fuehrer said.
Dave Coker, the president of national Fisher House foundation, said Cleveland is scheduled as a project in 2015.
“I am looking forward to coming out and doing a site visit,” Coker said. “I understand they have a couple of sites that they would like for us to consider.”
The foundation will only builds on federal land that is part of the VA campus, thus the land must be donated to hospital.
Coker said a donation of land from the hospital association would be a “phenomenal gesture.”
“It would be a great partnership,” Coker said.
Each house can accommodate up to 42 family members in 21 suites that share a common kitchen, laundry facilities, dining room and a living room with a library and toys for children.
The Center for Health Affairs will continue to look for new projects to fund and, possibly, the fund will grow beyond $15 million.
To find future projects, the group’s leaders will review the community’s needs through data collected for its hospital members.
But Ryan emphasized that the group’s leaders are not in a hurry to simply hand out money and will be considering projects over the next several years.
The hospital group performs a regular “community needs assessment” to help it’s nonprofit members determine where to spend their charity money. Early infant death and diabetes are both health concerns in which there are projects that could be funded “to have an impact in the community,” Ryan said.
“We’re not interested in putting money just out there to put it out there. We’re going to really think hard about what the deliverable ought to be, how we’re going to measure that and report back to the community as we have success or failure in different initiatives,” Ryan says.
To reach Sarah Jane Tribble, e-mail at firstname.lastname@example.org or (216)916-6254.
Note: A previous version of this story reported the wrong annual outpatient census for The Louis Stokes Cleveland VA Medical Center. The hospital treats 107,000 outpatients annually.