Where Does $100 to Shriners Hospitals for Children Go (2022)?

Shriners Hospitals for Children is a network of hospitals, medical and satellite centers, outpatient facilities, ambulatory surgery care centers, and outreach centersthat provide specialized pediatric care (orthopedics, burn, spinal cord, and palate) for children under the age of 18. According to the Shriners website, all but 2 of the hospitals (Canada and Mexico) are located in the United States under two non-profit corporations:

• The Shriners Hospitals for Children (for 11 hospitals, 1 outpatient facility (Salt Lake City), 2 ambulatory surgery centers, and 4 clinics) – a Colorado corporation based in Tampa, Florida; and
• The Shriners Hospitals for Children (for 1 hospital and 1 outpatient facility in Massachusetts) – a Massachusetts corporation based in Tampa, Florida.

The Shriners Hospitals for Children – Colorado 

The Shriners Hospitals for Children – Colorado (SHC – Colorado) is a non-profit 501 (c) (3) based in Tampa, Florida that reports the following information (based on the IRS Form 990 (2022):

There are 21 voting members (20 of whom are independent) of the governing body although 23 members are listed (due to timing differences), all of whom are male.

SHC – Colorado had net assets of nearly $9.2 million at year-end 2022 which about $1.5 billion lower than the previous year because $1.5 billion in net unrealizable losses on investments was recognized in 2022.

SHC – Colorado reported $1 billion in revenue in 2022 (compared to $1.6 billion in 2021 and $900 million n 2020), which primarily came from three (3) sources:

• $562 million in contributions, gifts, and grants (including $20 million from the government)
• $308 million in investment income, gain on the sale of assets, etc
• $164 million in patient services (i.e. insurance payments)

SHC – Colorado reported $964 million in expenses (not including $46 million in depreciation) and were categorized as follows:

• $440 million (43% of revenue):  Compensation-related Expenses
• $227 million (22% of revenue):  Fees for Services (primarily fundraising and program – no detail)
• $ 77 million (7% of revenue):  Medical Supplies and Patient Costs
• $ 71 million (7% of revenue):  Office-related Expenses
• $ 70 million (7% of revenue):  Grants
• $ 63 million (6% of revenue):  Advertising and Promotion, and Events
• $ 10 million 1% of revenue):  Interest, Fees, Taxes, and Other Expenses
• $  6 million (less than 1% of revenue):  Travel and Conferences

As illustrated above, the largest single category expense was compensation-related costs for the 5,035 employees who were compensated $440 million, which equates to an average compensation of $87,000. The most highly compensated employee was reported to be Ellen Raney, an orthopedic surgeon and professor who received $3.4 million in compensation in 2022.

Using the above information, every $100 in revenue was spent as follows:

$100:  Revenue

-$ 43:  Compensation-related expenses

-$ 22:  Fees for Services

-$  7:  Medical Supplies and Patient Costs

-$  7:  Office-related expenses

-$  6:  Advertising and Promotion, and Events

-$  1:  Travel and Conferences, Interest, Fees, Taxes, and Other Expenses

-$ 86 : Subtotal Expenses

  $ 14:  Revenue Remaining

-$   7:  Grants

 $   7:  Unspent Revenue:  To General Fund

As illustrated above, SHC – Colorado spent $86 of every $100 in revenue in 2022, with the unspent revenue allocated to the general fund. Although SHC – Colorado spent less than then the organization raised, a $1.5 billion in unrealized losses on investments caused net assets to deteriorate to $9.2 billion at year-end 2022.

Revenue was primarily spent on compensation for the medical staff, fees for outside services, medical supplies and patient costs, office-related expenses and advertising and promotion. With regard to advertising and promotion, it is important to point out SCH – Colorado used Edge Direct of Baltimore Maryland for direct mail solicitation and tv ads which raised $86 million. Edge Direct was compensated $25 million (29% or $29 out of every $100 they raised), leaving $61 million for SCH – Colorado. So, if your donation was through Edge Direct, then $71 out of every $100 was given to SHC – Colorado, while $29 was retained by Edge Direct.

It is also important to point out SCH – Colorado paid for first class flights for board members and executive staff whose flights are more than 2.5 hours long. Companion travel is provided for board members whose companion is participating in Shriners business. And, temporary housing allowances were provided for recruited individuals when relocation was required.

The Shriners Hospitals for Children – Massachusetts 

The Shriners Hospitals for Children – Massachusetts (SHC – Massachusetts) is a non-profit 501 (c) (3) based in Tampa, Florida that includes 1 hospital and one outpatient facility in Massachusetts. Key information about SHC – Massachusetts is summarized below (based on the IRS Form 990 (2022):

SHC – Massachusetts reported $50 million in revenue in 2022 (compared to $83 million in 2021, $59 million in 2020, $80 million in 2019 and $92 million in 2018), which primarily came from three (3) sources:

• $22 million:  Contributions, gifts, and grants (of which $14 million came from SHC – Colorado)
• $18 million:  Investment income, Gain on the sale of assets, and rents
• $10  million:  Patient Services (i.e. patient insurance)

SHC – Massachusetts reported $58 million in expenses (not including $4 million in depreciation) which were categorized as follows:

• $33 million (66% of revenue):  Compensation-related expenses
• $13 million (26% of revenue):  Fees for Services (primarily medical program services with no detail)
• $ 6 million (12% of revenue):  Office-related expenses
• $ 4 million (8% of revenue):  Medical Supplies and Patient Costs
• $ 2 million (4% of revenue):  Other Expenses

As illustrated above, the largest expense category was for compensation ($33 million) for 481 employees, which equates to an average compensation of $69,000.  The most highly compensated employee was John McCabe,an EVP who receive $1,007,517 (from a related organization).

Using the above information, every $100 in revenue was spent as follows:

 $100:  Revenue

-$ 66:  Compensation-related expenses

-$ 26:  Fees for Services

-$  8:  Medical Supplies and Patient Costs

-$ 12:  Office-related expenses

-$  4  Other Expenses

-$116: Total Expenses

-$ 16:  Excess Expenses Over Revenue

As illustrated above, SHC – Massachusetts spent $116 for every $100 raised.  Revenue was primarily spent on compensation for the medical staff and fees for services.

It is also important to point out SHC – Massachusetts paid for first class flights for board members and executive staff whose flights are more than 2.5 hours long.  Companion travel is provided for board members whose companion is participating in Shriners business. And, temporary housing allowances were provided for recruited individuals when relocation was required.

SHC – Massachusetts ended the year with $504 million in net assets compared to $582 million the prior year. The deterioration is primarily due to spending more than the organization raised and $66 million in net unrealizable losses on investments,

SUMMARY

In summation, the 2 non-profits that make up Shriners Hospitals for Children in the United States reported nearly $1.1 billion in revenue in 2022 (compared to $1.7 billion in 2021, $955 million in 2020, $896 million in 2019 and $1 billion in 2018) and spent about $1 billion in 2022 (not including depreciation). Collectively, the two organizations have $9.7 billion in net assets which provides significant investment income. The largest expense for both organizations is compensation for employees.  First class and companion travel was paid for by both organizations.

To read the IRS Form 990 (2022) for SHC – Colorado, click here.

To read the IRS Form 990 (2022) for SHC – Massachusetts, click here.