Nonprofit corporation to receive $5M from hospitalFunds to Worthington Regional Health Care Foundation Inc. come from sale proceeds
By: Beth Rickers, Worthington Daily Globe
WORTHINGTON — At the same time papers are signed to transfer ownership of Worthington Regional Hospital from the city to Sanford Health, the paperwork will be completed to transfer $5.415 million from the hospital to Worthington Regional Health Care Foundation Inc. (WRHCF). The funds result from the sale of Southwest Minnesota Radiation Center as well as an additional $2 million allocated from the hospital sale proceeds by the Worthington City Council.
WRHCF is a nonprofit corporation organized exclusively for charitable and educational purposes, governed by a nine-member volunteer board. In the past, its main purpose was to raise and receive charitable funds for the benefit of the hospital, but now, the bylaws have been revised so that undesignated funds within its control may be used to benefit the overall health of the community.
“The focus had to change away from the hospital,” explained Jason Vote, WRHCF chairman. “It was used to fundraise for that entity, but now will be much broader in scope.”
The funds the foundation receives have been referred to by city officials as “legacy funds,” according to WRH Chief Executive Officer Mel Platt, with the intent of benefiting health-care efforts in the city for many years to come. In accordance with state statute, funds transferred to the foundation from the hospital must be used for “hospital purposes” only — a condition that can be interpreted quite broadly.
“We have consulted legal counsel about interpreting it in the broadest sense,” Platt explained. “In the same way the hospital could have used the funds, they will be restricted with certain purposes. Prior to the transfer, the foundation had to restate its articles of incorporation and identify appropriate uses of the funds.”
Funds under control of WRHCF will now include both the hospital transferred funds and funds that have been received by the foundation from other sources, such as fundraisers, donations and bequests. Some bequests are designated for specific purposes while others are unrestricted and can be used at the discretion of the board.
One of the major proposed uses for the hospital transferred funds is medical personnel recruitment and retention, including retirement of education debts, payment of recruitment expenses, payment of moving expenses and “other forms of financial assistance necessary for the recruitment and retention of physicians or non-physician specialists.” The funds could also be used to assist in tuition reimbursement or retirement of medical education debt for individuals from the community pursuing a career in a health-care occupation. Vote and Platt both stressed that the recruitment efforts could be for any medical facility within the community, no matter the affiliation
Another consideration will be grants for not-for-profit organizations engaged in programs that will improve the health of the community through programs or services that deal with issues such as early childhood development, childhood immunization, community health education, communicable disease prevention, teen pregnancy education, maternal child health issues, cultural diversity health education and healthy lifestyles, smoking cessation programs and healthy workplace education.
“We will identify areas we see as an immediate impact we can make,” said Vote, adding that the list of possibilities just offers a “broad sense of where we can be spending these funds” and that the intent is not to benefit any one health organization within the community.
The funds are restricted, however, and cannot be used for: building programs; organizations to increase or develop a competitive advantage over an existing organizer or provider; or to provide any personal benefit, except as related to recruitment.
After carefully considering eight financial advisor firms, the WRHCF board has selected a local firm to oversee investment of the foundation’s new funds. The intent is to invest the money wisely and even grow it, allowing the interest to benefit worthwhile health care endeavors.
“We also need to recruit an executive director,” noted Vote. “We want to get a face on the foundation, an executive director on board.”
The documents regarding the hospital sale and the transfer of the funds to the foundation will be signed on Wednesday, with the funds transferred on Monday.