From Dollars to Difference: How CommonSpirit Health's Donor Support Drives Community Health

00:00:00:28 - 00:00:23:27
Tom Haederle
Welcome to Advancing Health. Philanthropic support of a hospital or health system can support tactical investments that will impact a community for years to come. In today's podcast, we hear how CommonSpirit Health leveraged its donor support to create a plan that helps unlock other investments that continue to drive the mission.

00:00:24:00 - 00:00:51:12
Sue Ellen Wagner
Welcome to Advancing Health. My name is Sue Ellen Wagner, vice president of trustee services with the American Hospital Association. Very happy to have with us today leadership from CommonSpirit. Specifically, we have Daniel Morissette, senior executive vice president and chief financial officer. And Nancy Bussani, executive vice president and chief financial officer and president of the Common Spirit Health Foundation.

00:00:51:15 - 00:00:54:15
Sue Ellen Wagner
Dan and Nancy, very happy to have you with me today.

00:00:54:18 - 00:00:56:00
Daniel Morissette, MBA
We're thrilled to be here.

00:00:56:03 - 00:00:57:13
Nancy Bussani
Thank you, Sue Ellen.

00:00:57:16 - 00:01:15:23
Sue Ellen Wagner
Philanthropy can have a huge impact in helping a hospital or a health system achieve its mission of caring for patients, while also supporting operations. What role is philanthropy playing right now in health care? And can you talk about what is happening at Common Spirit?

00:01:15:26 - 00:01:46:20
Daniel Morissette, MBA
Thank you so much for that question. I guess to I can summarize it briefly first by saying it plays a huge role in helping us achieve our strategic capital and operational objectives. And so the money that we receive from our various philanthropic sources really does make a dramatic impact on funding our mission and doing the strategic initiatives that we have ongoing of providing even cash flow support to some of our important endeavors.

00:01:46:23 - 00:02:05:22
Daniel Morissette, MBA
And as you know, in today's health care environment, it is I can't recall a time where it's been more challenging, just from a pure operation standpoint. So, at CommonSpirit, Nancy'll go into this some, CommonSpirit has made just a dramatic effect on our various communities.

00:02:05:24 - 00:02:32:06
Nancy Bussani
Well, thank you, Dan. And I know our goal when we raise funds is to make sure they really make a difference for the health system. Last year we raised about $360 million, which was really in a very challenging environment where there was some volatility in donor sense of how they want to give. And we did it in an environment where we had to streamline, where we really had to look at how do we make sure that we're as efficient as possible.

00:02:32:06 - 00:02:56:03
Nancy Bussani
So we have we had a return on investment about $5.25, so that every dollar that came in, really provided $5.25 back to CommonSpirit. But that's only as good as where it goes. So I think the strategy of making sure it goes for the most critical programs and equipment and facility is really one of the most important things we're focused on right now.

00:02:56:05 - 00:03:22:17
Daniel Morissette, MBA
I'll just add to what Nancy said. You know, $360 million does make a really big difference for us at CommonSpirit Health. But it is important that we think about the fact that, you know, our alternative sources of revenue. You know, like such as patient care revenue, we would need to generate much, much more than the $360 million to actually have the same impact on our margins.

00:03:22:19 - 00:03:49:03
Daniel Morissette, MBA
So, you know, reverting to my CFO background, when you look at patient care revenue, we would need to generate about, oh, $100 or so in patient revenue just to net about $4 after you're done with all the expenses. But as Nancy said, when we look at it from a philanthropy standpoint, for every hundred dollars that we're able to receive, we do net about $81.

00:03:49:06 - 00:04:18:21
Daniel Morissette, MBA
You know, it really does have a big impact, particularly on the, you know, community based programs and initiatives that we have in our various markets. Therefore, I just want to mention that philanthropy is just a huge piece of what we need to do to be more and more effective from an operational and financial standpoint. And so it's been just a thrill for me to be part of our growing enterprise here, because it is so critical to what our mission is.

00:04:18:23 - 00:04:47:12
Daniel Morissette, MBA
You know, it is important to add that, you know, philanthropic funds have become a pretty significant data point when we meet with our outside investors, with bond rating agencies and the like. Because it is one way to help assess the strength that the health system's creditworthiness and its bond rating. But also it does help to know that the donors have confidence in us and the value we're bringing to our community.

00:04:47:19 - 00:05:20:08
Daniel Morissette, MBA
So the dollar amount really does make a difference from the, you know, just a pure financial and operational standpoint, because it is an alternative revenue stream that is, of course, less sensitive to the volatile environments we deal with, like payer mix and reimbursement pressure and fluctuating volumes. So, you know, philanthropy oftentimes does offset some of our debt funded capital project. Therefore it does reduce our leverage as well as strengthen our balance sheet.

00:05:20:11 - 00:05:43:21
Sue Ellen Wagner
Very important points about the value of philanthropy. Just to expand a little bit on what you both talked about. Philanthropy can be a strategic investment, and it has the value beyond the dollars raised. You both mentioned that a little bit. Can you expand a little bit and talk about why health care leaders should view philanthropy as a strategic investment, in addition to what you've already said?

00:05:43:24 - 00:06:13:29
Daniel Morissette, MBA
Well, first of all, we have so many projects in the large health system like we have even being a community based health system. And so we have both immediate needs. And I've always asked Nancy whatever she can do to get us unrestricted gifts that we could apply. It is important that we align our operational and our strategic leaders, partner closely with our philanthropy team so we can make sure the donations we receive do have the greatest impact possible.

00:06:14:02 - 00:06:46:23
Nancy Bussani
I think you can tell Sue Ellen how lucky I am to have a CFO that understands the nuances of philanthropy that, you know, donors at the end of the day are going to give where they're most passionate. But I do believe donors want to make the biggest impact for their entire community. And so when philanthropy teams have a seat at the table with their strategy leaders, with their hospital presidents, with their executive leadership, they can listen and understand where that strategy is driving the most critical investments.

00:06:46:25 - 00:07:19:17
Nancy Bussani
And it's those conversations with our donors that help to make for the best match. So when they do give, they understand how they're making the biggest impact. So we really do work hard to make sure that our leaders - we have 80 foundations throughout all CommonSpirit. They each have a seat at the table with their leadership team so that they can listen, they can learn, and they can understand how to have those important conversations with donors to make sure those dollars make the biggest difference they can.

00:07:19:17 - 00:07:46:24
Nancy Bussani
So it's not just about the volume, it's about the purpose. And to me, that only happens if your philanthropy leaders are sitting at the table listening to those conversations. Dan and I have had a lot of conversations about the timing of that, too. How do you have those conversations at the right time? And he's been - well, I'll let you talk about that, Dan, because you've been really helpful in helping us to determine when philanthropy needs to be brought in.

00:07:46:26 - 00:08:07:20
Daniel Morissette, MBA
You know, Nancy, that's a great point. Certainly I agree with that, right? We know that the timing is really important because, you know, if you engage the donors too early in the process and then somehow we decide for various reasons that the project doesn't go forward, you know, it can create some negative feelings in the, you know, in our donor community.

00:08:07:23 - 00:08:32:14
Daniel Morissette, MBA
And then, of course, on the flip side, if you wait too long and the major project is already up and going, you know, most donors feel like their support might really be needed. So, you know, we are continually encouraging our strategy and finance teams to include philanthropy, you know, so that we can all get, you know, better at finding that balance of the, you know, the desires of the donors.

00:08:32:16 - 00:08:55:27
Daniel Morissette, MBA
I'd like to point out that how critical philanthropy can be to innovation for a major health system like ours, as well as for the future of health care. Philanthropy can really help support to make a difference in from an innovation standpoint. Certainly we as a mission based health system, are fully devoted to serving everyone in our communities. Certainly

00:08:55:27 - 00:09:19:04
Daniel Morissette, MBA
we have a unique, strong focus on those who are most vulnerable. But with the health care dollars so tight right now, we often do wish to rely on our donors, whether they be individual corporations, foundations, government agencies, you name it. You know, to invest in our vision for what innovative programs or research is going to make a difference in the future.

00:09:19:06 - 00:09:29:15
Daniel Morissette, MBA
You know, you can be our most dedicated, long term connected donors that will walk with us to launch high risk but hopefully super high reward projects.

00:09:29:17 - 00:09:53:07
Sue Ellen Wagner
Thank you so much. Nancy, you talked a little bit about the importance of having a seat at the table. Successful philanthropic initiatives really need the support of the board and executive leaders, and I believe that equates to having a seat at the table. Can you talk about, both of you, what are the ways you see boards and leaders fitting into your philanthropic investments?

00:09:53:10 - 00:10:24:11
Nancy Bussani
Yeah, absolutely. Well, I want to start by saying that our CEO Wright Lassiter, has been very supportive of the importance of philanthropy, and he plays a really strong role in it. He serves not only as the CEO for CommonSpirit, but he's also the CEO for our national foundation. And that sends a really strong message to our boards that we have the attention and the investment of the leadership. We have throughout all of our 80 foundations about 1500 local board directors.

00:10:24:13 - 00:10:58:26
Nancy Bussani
And so it really is that connection between our philanthropy leaders understanding the strategy, being able to articulate it, and then taking that back to those board directors and helping them be our advocates. They can only help us as much as we give them the information to help us. So being able to have kind of those succinct messages about what really is going to move the hospital forward in their community, what's going to make us be able to provide the best clinical, excellent care to everyone?

00:10:58:28 - 00:11:22:27
Nancy Bussani
Because, as you heard Dan say, we have a lot of hospitals in very vulnerable communities. But our goal isn't just to open the doors and have access. It's to make sure that everyone has the best care. And that's where our donors come in. They can make the difference between, you know, covering our costs and creating great investments in the innovative programs that really make us excellent.

00:11:23:00 - 00:11:48:02
Nancy Bussani
We can't do that without the boards. Their voices really help to expand. So you take in a community, two or three executives in the philanthropy leaders, and then you maximize that by 20 or 30 people on the board who typically are very influential people in their communities. That's where we start seeing true visibility and awareness and believe in the work we're trying to do.

00:11:48:02 - 00:11:56:06
Nancy Bussani
So I can't overestimate the value that our board directors have in making these investments a reality and the right investments.

00:11:56:09 - 00:11:59:20
Sue Ellen Wagner
And, Dan, do you want to elaborate any more on that point?

00:11:59:22 - 00:12:39:05
Daniel Morissette, MBA
Just really briefly, thank you. You know, over the years, I've gotten more and more involved in partnering with our philanthropy teams and making sure that all of our local chief financial officers, for example, at our hospitals and within our regions - they do know the importance of putting every dollar raised, you know, into action. So I consistently discussed philanthropy and in our regular meetings, but also through issue a quarterly memo to all the CFOs to share how critical it is for them to work with their philanthropic leaders to get the funds transferred so that we can put it to good use.

00:12:39:08 - 00:12:47:02
Daniel Morissette, MBA
And this certainly helps our philanthropy leaders by having an equal partner on the financial and operational side of the hospitals.

00:12:47:04 - 00:13:18:18
Nancy Bussani
And that's information that - when that doesn't happen, Sue Ellen, if you don't have a CFO that partners with you that way, sometimes our dollars don't get put into action as quickly as we need. We cannot go back to donors and to boards and show the impact of their investments if that doesn't happen. And so it's such a critical bridge for us to be able to say, not just raise the money, but to demonstrate back to those who were generous to us how we used it and the impact that made.

00:13:18:18 - 00:13:40:20
Nancy Bussani
And so sometimes it's this financial partnership that allows that to happen. You know, with everything going on that's not always the top priority for a CFO to make sure those dollars get transferred to cover all of those costs that   those dollars will help to support. And it really doesn't allow us to feedback to the board what's happening in their communities if we don't have that partnership.

00:13:40:20 - 00:13:45:29
Nancy Bussani
So it really has changed how we work with our CFOs throughout all of the hospitals.

00:13:46:00 - 00:14:24:21
Sue Ellen Wagner
I love those final words. Thank you. Well, Dan and Nancy, thank you so much for being with me today. You've talked a lot about the importance of not only your CEO partnership, but your CFO partnership. So I think our listeners have a lot to learn about that. And really, given the complex environment that we're in, still being able to get that return on investment for your philanthropic dollars is really important so that you can continue to fund your innovations and your initiatives. And getting that board to, you know, be supportive and participating in the philanthropic initiatives, I think is really important.

00:14:24:21 - 00:14:29:01
Sue Ellen Wagner
So thank you both. Really appreciate all of your great information.

00:14:29:03 - 00:14:37:15
Tom Haederle
Thanks for listening to Advancing Health. Please subscribe and rate us five stars on Apple Podcasts, Spotify, or wherever you get your podcasts.