Healthcare Funds Established To Benefit Area Residents
Two New Health Funds Forged
By NICK BROWN, Sun Staff
AYER -- Representatives from Deaconess-Nashoba Hospital, the Greater Lowell Community Foundation and the Community Foundation of North Central Massachusetts gathered at North Middlesex Savings Bank yesterday to announce the creation of two new health-care funds. The funds are comprised of money from two sources: old endowments to the nonprofit Deaconess Nashoba Hospital, which was bought in 2003 by Essent Healthcare, and the net profits garnered by the sale.
Both foundations will manage the money, marking the first time in history that two independent foundations will be used to manage the inherited funds of a for-profit hospital.
The endowments inherited by Essent when they purchased the nonprofit hospital had been used to provide health needs to the community and to help fund continued education for professionals.
To assure that the money continue to target philanthropic programs, the new buyers agreed to allow the endowments -- along with net proceeds from the sale of the hospital -- to be managed as part of two new funds managed by the foundations.
Normally, said David Kronberg, executive director of Greater Lowell foundation, when a for-profit health-care company purchases a non-profit hospital, a new foundation is created to manage existing endowments. In 175 such sales since 1973, never before have two community foundations been delegated to manage the money.
The two foundations will split the approximately $3 million in funds, and plan to use the money primarily to "provide annual distributions to nonprofit organizations... in order to advance community health," according to a written statement. Ten percent of the money will also fund continued education.
Lowell-based Kronberg calls the agreement the "Democratization of philanthropy."
"It gives the community a say in how the money is used," said Phil Grzewinski, president of the North Central foundation. Area residents have a "powerful opportunity... to improve the region's community health by contributing to these two new funds," said George Duncan, president of the Greater Lowell foundation.
Unlike new foundations, existing organizations already have money, (GLCF and CFNCM have $24 million in combined assets), a stable infrastructure, and a broad reach in the community (between them, the two foundations cover thirteen towns). Those factors allow GLCF and CFNCM to put the money to a more versatile and effective use than a brand new foundation could, Kronberg said. "We're witnessing an unprecedented cooperation between these two bodies," he remarked. "It symbolizes a new approach to community health care."
