Where does $1 to Hospice of Palm Beach County go?

Hospice of Palm Beach County, Inc. is a 501 (c) (3) that is a “part of” (one non-profit may not own another non-profit) Trustbridge, Inc. a 501 (c) (3) that has two branches: one for hospice care and the other for support services. The hospice care branch has three organizations:

• Hospice of Palm Beach County, Inc. (HPBC)
• Hospice of Broward County, Inc. (HBC)
• Hospice by the Sea, Inc. (HS)

The other branch of Trustbridge, Inc. consists of five organizations: medical supplies, home health care, palliative medicine, caregiver support, bereavement programs, and fundraising:

• The Medical Store of Palm Beach County, Inc.
• Focus Care Home Health Inc.
• Harbor Palliative Care Services, Inc.
• Hospice by the Sea Foundation, Inc.
• Hospice of Palm Beach County Foundation, Inc. (HPBCF)

Trustbridge, Inc. provides management and other support services to the eight organizations listed above.

The existence of nine separate 501 (c) (3)’s can create confusion and complicate the understanding of this vast organization (but keeping designated nonprofits separate best protects the tax-exempt status of all entities, but does not prevent them from working together in other ways.that provide support services) so the easiest way to know where donations are spent is to follow the money and specifically to follow a $1 donation from the time the donation is made to how it is spent. So, if you donated $1 to the hospice in Palm Beach County, how was it spent?

Hospice Palm Beach Country (HPBC) and Hospice Palm Beach County Foundation (HPBCF)

Hospice of Palm Beach County (HPBC) does not rely on contributions (of the $90 million they received in 2014, $87.3 million came from patient service revenue, $1.9 million from Hospice of Palm Beach County Foundation (HPBCF), and just $650,000 from contributions).

HPBC did not spend revenue on fundraising because the fundraising events were administered through the foundation (HPBCF) who then distributed a portion of the revenue to HPBC.

The foundation, HPBCF reported $10.5 in revenue which came from four sources:

• $5 million from the gain on the sale of assets
• $2.8 million from contributions and fundraisers
• $2.3 million from investment income (the organization has $115 million in net assets, mostly securities)
• $0.5 million on the sale of inventory

Of the $10.5 million in revenue reported by the foundation (HPBCF), $1.9 million or 18% was granted to HPBC, $5.5 million (52%) to Trustbridge, Inc., $1.4 million (12%) was spent on compensation, benefits and operating expenses, nearly $1 million (9%) on investment management fees, and the remaining funds (about $1 million or 9%) added to the fund balance which had $115 million in net assets at year-end. All of which leads to the question of whether a $1 donation would originate with the foundation (HPBCF) or with the hospice itself (HPBC)?

If the donation originated at HPBCF (where most fundraising originates), then the $1 is spent as follows:

 $1.00:  Donation

-$0.12:  Compensation, Benefits, Operating Expenses

-$0.09:  Investment Management Fees

-$0.21:  Subtotal Expenses

 $0.79 Amount Left

-$0.52: Given to Trustbridge, Inc.

-$0.18:  Given to HPBC

 $0.09:  Amount Remaining; Placed in Fund Balance

As illustrated above, a $1 donation to the foundation (HPBCF)P provided 18 cents to the hospice (HPBC).

If a $1 donation was given directly to the hospice (HPBC), then the $1 is spent as follows:

 $1.00:  Donation

-$0.60: Compensation and Benefits

-$0.14: Other Expenses (not detailed)

-$0.11: Medical Supplies, Medications

-$0.11: Office and Other Services

-$0.01: Travel, Conferences, Promotion/Advertising

$0.97: Subtotal Expenses

$0.03:  Amount Remaining

Given that hospice services require heavy staff, medical, supply, and medications, the concentration in these areas is not surprising. However, when considering expenses reported by the hospice (HPBC), questions arise with regards to expenses in three areas:  other expenses, travel, conferences, and meetings, and occupancy.

HPBC generated nearly $90 million in 2014 (primarily from Medicare and Medicaid) and reported $91.8 in expenses (net of depreciation) which included $8.3 million in other expenses for outside services (with no detail provided), $5.5 million in other expenses (also not detailed), $460,000 on travel, conferences, and meetings, and $7.5 million on occupancy (and yet they own the land and building). This information may be explained in the audited financial statements but the website does not have a link to current statements (the most recent are from the year ending December 31, 2013).

Links to the IRS Form 990’s are below:

2014 IRS Form 990 Hospice Palm Beach County Foundation, Inc.

2014 IRS Form 990 Trustbridge, Inc.