Gerald Levey, M.D., is the low-key, somewhat scholarly provost of the University of California Los Angeles' medical sciences division and dean of its medical school. Charles "Jud" Pannaci is a retired funeral home director who's quick with self-deprecating humor and laughter.
The two men are separated by a vast geographical and cultural gulf. Levey is in the nation's second-largest city, with a population of more than 3 million. Pannaci is in Richfield Springs, a tiny village in upstate New York with a population of 3,500.
Yet both share something: They're nonpareil healthcare fund-raisers.
Levey and his development staff will have helped raise nearly $1 billion for UCLA and its various healthcare endeavors, including a planned new hospital, by the middle of 2002. Pannaci almost single-handedly raised the $500,000 required to build a new outpatient clinic in his town, kicking in $300,000 of his own money in the process. Construction of the clinic, to be operated by Bassett Healthcare, which owns 180-bed Mary Imogene Bassett Hospital in Cooperstown, N.Y., is expected to begin by late spring.
"When people ask me what I do, I say I give money away," Pannaci says lightheartedly. He adds that his contribution is taking a significant enough bite out of his portfolio that he will have to keep an eye on his finances in the future.
Levey also deals with people who give money away: aircraft leasing tycoon Leslie Gonda, whose foundation donated $45 million toward the establishment of a neuroscience and genetics research center and has given some $60 million to the university; media executive Michael Ovitz, who donated $25 million toward the construction of the new hospital; and officials at toy manufacturer Mattel, which is giving $25 million for the establishment of a new children's hospital.
"When I took this job in 1994, it was clear to me that some intensive efforts to raise funds from the private sector were required," Levey says in his matter-of-fact tone. UCLA was raising some $40 million annually for healthcare ventures before Levey's tenure. Levey overhauled the development office, bringing in new staff and consultants. The office raised $105 million in 1995 and nearly $250 million last year, according to UCLA Health Sciences Division spokesman David Langness.
The way it should be done
Levey and Pannaci accomplished the goals the way healthcare fund-raising experts say it's supposed to be done: through local connections, intense networking and creating a connection between donors and the recipients of their money.
"More people in the past would give directly to the hospital. Now they're directing their dollars to a specific purpose, toward a piece of equipment or a building," says Rhoda Weiss, a Santa Monica, Calif.-based consultant who has lectured often on healthcare fund-raising issues. "In turn, they're being more demanding and want more naming opportunities."
The physician-patient relationship is also being tweaked for soliciting gifts, with hospitals and healthcare systems tutoring physicians on how to solicit gifts. Most sizable gifts, observers say, come from grateful patients or their families.
In one instance, the late opera singer Ruth Tippett willed her mansion and six acres of surrounding land to the charitable foundation affiliated with 431-bed Scripps Memorial Hospital-La Jolla (Calif.). The hospital netted $24 million when it sold the property last year. Tippett's close relationship with her physician, who has practiced at the hospital for more than 30 years, aided the bequest, according to Scripps officials.
"Almost anybody on the street can close their eyes and see a family member needing healthcare, and that's why it has such an amazingly strong appeal," says Robert Carter, president of Ketchum, a fund-raising consulting firm with offices in Pittsburgh and Dallas.
Richard Binder, M.D., medical director of the cancer center at 656-bed Inova Fairfax Hospital in Falls Church, Va., has begun approaching patients in conjunction with Inova Health System's fund-raising department for the purpose of funding genetics-related cancer research.
Typically, Binder will co-author a solicitation letter that's sent to the patient. A meeting is then arranged among Binder, the potential donor and a fund-raiser.
"Grateful patients have demonstrated their gratitude for other institutions, so why not here?" asks Binder, who helped raise $2.5 million to build medical education facilities for Inova's physicians. "Also, grateful patients know other people in the community who can contribute."
Yet Binder still approaches the process with kid gloves. "I try to be cautious and not overly bold and aggressive," he says. "I try and express the benefits of the program that is being established and how it will benefit things in the future."
Binder is far from alone. At Jefferson Health System in Wayne, Pa., physicians are being briefed by fund-raising staff on how to solicit patients.
"We work with physicians who hold leadership positions at the hospitals, and we do a lot of internal education," says Robin Moll, vice president of development at Jefferson's Philadelphia-area hospitals.
Yet there remains a widespread reluctance among physicians to solicit patients. Moll acknowledges that many physicians don't want to risk damaging or breaching their relationship with patients. "They feel their relationships are special ones, and asking them to get into development can be difficult," she says.
More aggressive attitude needed
Yet more forwardness in fund raising is necessary. With revenue down from cuts in managed-care payments and through the Balanced Budget Act of 1997, hospitals are seeing fund raising as a more holistic undertaking. Indeed, Inova Health System has embarked on a mission to fully integrate fund raising throughout its entire organization. Management is being asked how it can "weave fund raising into the daily mindset" and the fund-raising role eventually will be integrated into the job descriptions of Inova trustees, according to literature about the program.
"We need private support now more than ever before, both in terms of economics and because philanthropy is a good vehicle for reminding folks of the central character of our community-based mission," says Inova President and Chief Executive Officer J. Knox Singleton.
Extensively re-examining community ties is a healthy exercise for providers, fund-raising experts say, and a sure way to boost development.
"(A hospital) should never ask for money if your only relationship with a member of the community is a little envelope with a window that shows up in a patient's mail," Carter says.
Ironically, though, some healthcare philanthropy experts say contact through the mail could increase given some of the storm clouds gathering on the fund-raising horizon, including completion of regulations connected with the Health Insurance Portability and Accountability Act of 1996, declines in stock values and a possible recession (See story, p. 45).
Indeed, despite the largess toward UCLA-Levey says more than 10 gifts exceeded $10 million and one anonymous donor has given $70 million-all but one of its major gifts came from sources within Los Angeles County.
"(Former Congressman and Speaker of the U.S. House of Representatives) Tip O'Neill said that all of politics is local. So is fund raising," says Michael Stein, Bassett Healthcare's vice president of external affairs.
Asking the neighbors
Stein often accompanied Pannaci on his rounds through Richfield Springs during the latter half of 1999 and for much of 2000. Pannaci had been moved to fund the clinic strictly by happenstance: An opportunity to refurbish the home his great-grandparents had built in nearby Gloversville, N.Y., had fallen through, and he decided to redirect his energies. Although Bassett already operated a clinic in town, it was in a badly cramped storefront. Pannaci used to take his late mother to the clinic for treatment of her emphysema, and he was well aware of its need for an upgrade.
Although Pannaci was contributing the initial $100,000 with no strings attached, he would give the next $200,000 only if that figure was matched by other donations. Yet Richfield Springs and the surrounding environs were hardly rolling in dough: Data kept by Bassett Healthcare shows the average household income in 1999 was $46,943, compared with a statewide average of $62,986.
But Stein and Pannaci would visit local households and businesses with a packet that included a statement of purpose and renderings of the clinic, and people would open their checkbooks.
"I was never willing to come up with a preconceived figure in mind," Pannaci recalls. "It was `this is our need, and this is our community.' " He adds that the undertaking work he had done in town was a big inroad. "I had seen people during the most stressful periods in their life, and it helped open doors," he says.
Richfield Springs residents who were Bassett patients or knew someone who received care there gave because the clinic was for their town, or because they admired and respected Pannaci.
One woman whom Pannaci surmised had little money gave $2,500. An Italian-American household, which Pannaci knew was well-off, hedged on a donation. But Pannaci, whose grandfather had served Gloversville's large Italian immigrant community at the turn of the century, turned the screws of ethnic pride. The family sent a check for $100.
By the end of 2000, some $203,000 had been raised. Another $54,000 had been raised by this spring. In total, the sum averages out to $75 for every Richfield Springs resident.
In a galaxy far, far away...
Much the same thing takes place at UCLA, just on a galactic scale. The $45 million gift from Gonda's foundation came because Gonda has had an interest in genetics research, and Levey connected him with the need.
"With the start of the Human Genome Project (in the early 1990s), it was easy to visualize preventive medicine being linked to the functionality of genes," Levey says, noting that cancer comes from genetic mutations inside cells. "If we were to make any progress in this field, we needed a genetics building. Leslie Gonda likes to build buildings that house such projects."
UCLA's healthcare fund-raisers say Levey's ability to link large donors with equally large projects is borne partly from a mix of talent and pragmatism.
"Some people are intimidated by fund raising, thinking of it as a form of begging, but to Dr. Levey it's about getting a job done," says Anne Dunsmore, director of development at UCLA's Health Sciences Division and CEO of Capital Campaigns, a Los Angeles-based fund-raising consulting firm. Dunsmore says Levey is not only willing to approach donors but sways them by communicating a level-headed passion for science, demonstrating a sharp sense of humor and continually discussing with members of UCLA Health Sciences' myriad boards what projects to pursue.
Levey's dexterity in handling boards apparently worked well when he approached Ovitz. Both Ovitz and his wife attended UCLA in the 1960s and wanted to help with the construction of the new hospital to replace a structure extensively damaged in the 1994 Northridge earthquake. "I asked Mike to put together a board for fund raising, and that he'd have to make a leadership gift," Levey says. Ovitz was able to persuade renowned architect I.M. Pei to design the structure.
Linking board membership and even governance to philanthropy is increasingly common. Observers say many hospitals these days require donations before someone may sit on their boards. At UCLA's crosstown rival, Cedars-Sinai Medical Center, a resource development committee that's an adjunct of the hospital board is an integral part of the hospital board's monthly meetings, says Gary Leo, Cedars' senior vice president of community development.
"Once there is an area we want to be involved in, we talk with the boards," Leo says.
And the end result of all the efforts? At UCLA, it will be a conglomeration of huge buildings that dwarf visitors or passersby. In Richfield Springs, it will be a modest building with an ornamental cupola that's reminiscent of the regional architecture.
"It will be a structure everybody can identify with," Pannaci says. "And when people drive by, whether they gave $5 or $5,000, hopefully they'll say, `I helped pay for that.' "