A balancing act: Navigating the public and private health care landscape

In the years after the Affordable Care Act, public funding for health care has skyrocketed.

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But private donations still play a key role, both in providing health care today and in researching new cures and innovative treatments, says Keith Todd, president of the OHSU Foundation.

“When I first came into health care philanthropy, it was generally raising funds for a nice add-on,” Todd says. “Doctors made money for delivering care, hospital inpatient care was expensive, and hospitals were paid for it. If they wanted to build a building, they planned for it and it happened.”

The Affordable Care Act may pay for procedures for people who could not afford care in the past, but it does not cover the true cost of providing care, Todd says. That leaves a gap that hospitals must fill. In the past, health care institutions raised funds to elevate themselves above the pack. Without private donations or philanthropic grants, many hospitals — especially in rural communities — would not be able to afford the latest technology.

OHSU has also seen the value of turning to philanthropy even when funding shortfalls don’t exist. The hospital and university system receives millions of dollars per year in National Institutes of Health funding for research — but it’s through the recent $1 billion Phil Knight-backed anticancer initiative that OHSU truly hopes to innovate.

“I do not believe that the federal government takes risky bets. NIH does not reward innovation or creativity. They are the single largest funder of research in America — but they also need to not have too many failures,” Todd says. They have to promote things that are working so they can build on that with their constituency — which, for the NIH, is Congress. They need to demonstrate that they aren’t doing crazy stuff.”

The Knight Cancer Institute, led by accomplished physician-researcher Dr. Brian Druker, and backed by thousands of small donors who joined the Nike founder’s large pledge, is hardly a “crazy” program. But to succeed, its researchers will have to take risks that may not pan out — and the NIH is not comfortable with that uncertainty.

“Bill and Melinda Gates are innovating to solve major health problems around the world, and I’ve never seen that happen with government funds,” Todd says. “My general belief is that government funding is not going to support creativity or innovation. That’s philanthropy’s role.”