Occasionally I hear from people who would like to fundraise to help someone who has financial needs because of a serious medical situation such as a cancer diagnosis or transplant. Even with health insurance, facing the financial responsibility of paying for medical treatment can become overwhelming.
Here are seven guidelines to follow when raising funds for individuals:
1. Research all of your options
When a family is facing a financial hardship due to a serious medical situation, it is important to do some research before jumping into a fundraising effort. After exhausting health insurance options find out about other organizations that may be able to help:
- Hospital assistance - Speak to social services at the hospital who may be aware of financial resources, foundations and sources of financial help.
- Nonprofit health care - Is there a nonprofit hospital or clinic where the patient can get all or part of the care needed? Speak to your physician about referrals to appropriate facilities.
- Government agencies - Your contact at the hospital may be able to refer you to government agencies that can provide services.
- Nonprofit organizations - Contact local charities and food banks that may offer “stop gap” assistance. There are some charities that are specifically set up to provide financial assistance for medical care. For example, The Chronic Disease Fund helps underinsured patients with chronic disease by providing funds to cover co-pays. Heroes for Children is another organization that provides assistance to families within the state of Texas, with children (0-22 yrs of age) battling cancer.
- Family stay - Find out if there is a Ronald McDonald House or other family stay facility near the hospital which has free or low cost accommodations. This can ease the financial burden when our of town hospital stays are required.
2. Be aware of legal issues
Donations that are given to an individual and not a registered charity are not tax deductible. It is best to let people know upfront that their donation is going to an individual and therefore there is no tax benefit for them.
Friends, family, co-workers and extended acquaintances may be willing to give out of pocket just because they care about the person and not be as concerned about tax benefits. People who are not acquainted with the individuals involved may be reluctant to donate to someone who is not a registered non profit organization.
If possible, partner with a non profit organization that can receive designated funds for the individual. Then donations can be designated as tax deductible by those who make donations. A good place to start is a community foundation that serves your area. (If you are not aware of one near you, just do a websearch using the words community foundation plus your city name.)
The Transplant Fund helps transplant and catastrophic injury patients afford critical but uninsured medically related expenses through fundraising guidance, patient support and resources, as well as financial assistance. The Children’s Organ Transplant Association is another organization that provides financial support for transplant patients. A local community foundation may also be able to help manage your fund account. Just Google the words community foundation plus your city name to find one near you.
3. Understand what motivates donors
Many people will want to make sure that all of their donation goes directly to help the person in need. Donation request letters are especially good for this reason, as there are very little expenses unlike events and product sales.
Also realize that fundraising may not be appropriate in every situation. Medical expenses must be quite extensive to warrant fundraising. For example, asking for help when a child gets a cast for a broken arm will not likely motivate people to donate because the need is not as great as a life threatening illness.
4. Appeal to individuals, not businesses
When seeking donations for an event appeal to individuals rather than directly to businesses. Corporations are usually concerned with making sure their donation is going to an organization that has government oversight, as well as a group that has the tax deductible donation benefits.
Your circle of friends may be able to get donations from their place of business since they have influence with their employers that outsiders do not have. So try to appeal to businesses through their employees.
5. Fundraising events rally the community
Fundraising events such spaghetti dinners can also be a good way to raise money. As with all fundraising events it is important to get just about every thing donated, and even more so when fundraising for individuals - food, location, decorations, and prizes. Survey your extended circle of contacts and ask them to donate supplies and prizes.
6. Make it easy for people to donate
Finally, make it as easy for people to donate. Offer as many ways as possible for people to help the family that is in need of money for their medical expenses. Explain how donations can be made and include contact information on all materials.
- Set up a separate bank account just for donations
- In letter appeals give the name and address of the bank location(s) in case people want to make donations directly at the bank
- In letter requests include a pre-addressed envelope for those who would like to donate by mail
- Fundraising events offer multiple opportunities for people to donate anonymously such as donation boxes, raffles, and opportunities to “round up” ticket purchases.
Example:
Your Support is Greatly Appreciated!
Three Ways to Help:
1. Make a deposit to the bank account set up especially to help defray medical costs. Go to National Bank, 1500 Travis Street, Anytown USA and let them know that you would like to make a deposit to the account of Jane Smith.
2. Mail your donation with check made out to Jane Smith to 7859 Oak Strett, Anytown USA
3. Attend our spaghetti dinner event on January 24, 2006. Tickets are $7 for adults and $3 for children 12 and under. Besides the dinner there will also be raffles, games and other fun activities for the whole family. If you have any questions about the fundraising efforts to help Jane Smith, please contact her friend Sally Johnson at 210-555-1234.
7. Online fundraising to reach out of town supporters
One way to make donating easy for those who want to help is to set up a way to accept donations online. Then people who live near and far can donate securely online. If you are working with a nonprofit to manage your fund then speak with them about this first. They may have an online donation system already set up. If they don’t then you’ll need to work with them to set one up.
While there are many online donation providers, many will only work with registered charities. So this is a question you need to ask straight away when researching these options. One provider that helps people raising funds for individuals is GiveForward. This system will let you raise funds for any cause, including medical expenses. One family’s efforts to raise funds online for a kidney transplant was recently featured in the Chicago Tribune.
Conclusion
When raising funds for individuals keep these factors in mind. Exhaust all usual financial aid services before going the fundraising route. Be mindful of legal and financial implications of fundraising, and plan fundraising activities have the lowest cost and most impact so that funds raised can go directly to those persons in need.
May 5th, 2009 at 12:55 pm
Great post, Sandra. Working here in a hospital as I do, we get lots of questions from individuals about how they can raise money to help loved ones. You offer some very sounds advice!
Let me offer one more. Here in Boston there have been several high profile scams involving fundraisers for sick individuals who turned out not to be sick at all. It’s an unfortunate happening that hurts everyone. But it does highlight the importance of bringing together a large group of people from different walks of life to support, advocate and fundraise for the patient. Not only will this make your fundraiser more successful, but a large group of supporters will give the fundrasier credibility with those who simply don’t know the recipient very well. The larger the circle, the more people in it.
May 5th, 2009 at 1:19 pm
Joe - Thanks for your suggestions. That is a great point about bringing in lots of support to enhance the credibility of the effort.
May 14th, 2009 at 7:00 pm
Are the donated monies taxable income to the person for whom the money was raised?
May 15th, 2009 at 1:31 pm
Whether the money is handled through a nonprofit organization or foundation or not it may still be taxable as income. For more info I would recommend checking with an accountant and/or legal professional.
June 3rd, 2009 at 9:23 am
Thanks–this is good information as we’re preparing an event for my brother. Do you know if there’s a rule of thumb to estimate attendance at an event based on the number invited? I know that for weddings, they say to expect 30% not to attend. What about for benefit/fundraisers?
November 13th, 2009 at 2:45 pm
I have heard there may be problems using a nonprofit as a conduit for funds. If the nonprofit is not a medical organization, and money is used soley for medical expenses, is that a violation of some sort?
November 13th, 2009 at 3:04 pm
Ellie - you’re on the right track. Funds can’t be funneled through just any nonprofit organization. This type of service has to be somehow tied to the organization’s mission (which is approved by their board and governmental agencies). Activities that fall outside the nonprofit’s core purpose can lead to what’s called “mission drift” and possibly legal issues. Example: Lack of Oversight can Damage Your Nonprofit’s Long-Term Funding & Survival Nonprofits are wise to consult with qualified experts i.e. an attorney if administering medical funds is not something they have done before. (Disclaimer - I’m not a lawyer!)
January 15th, 2010 at 2:24 am
On the 24th of January this year we will be beginning fundraising efforts for our son who was entered today (Jan 14, 2010) on the transplant list for a kidney and pancreas. Due to a botched diagnosis - we had no warning. We partnered with our church with the men’s group and youth group pitching in to help host/serve a chili fundraiser. The next one will be at a Veteran’s service organization, the 3rd one will be at another church and the 4th one at the Elks. He was laid off Oct 14, 2009, diagnosed on Nov 25th, met with the transplant team Dec 23 and placed on the list today. It has been stressful, hopeful, and complicated. We partnered with these organizations so that people WOULD know it is not a scam and for real. I am so grateful that my son can live, and torn because someone has to die so that he can live. The outpouring of support restores my faith in mankind. We know he will have to pay taxes, and we have figured that into the amount we need to carry him through the next 6 months. Keep records, records, receipts and more records because you will need them at tax time!!!!
January 19th, 2010 at 10:19 pm
Sharon - thank you for sharing. What a roller coaster it must have been the past few months. It sounds like you and your son are taking a positive outlook despite difficult situation. Thanks for adding some advice too about record keeping for others who might be in a similar situation. I wish you all the best with you fundraisers and especially pray for a hopeful outcome for the your son with a successful transplant.
January 23rd, 2010 at 12:57 am
My mother was diagnosed, three times now, with primary hyperparathyroidism. The condition is not well known of. Her doctor had to consult with other doctors because they had no idea what it was. I did some reasearch and learned a lot about the disease and it’s affects. She has had it for years now and her symptoms are getting to the point she is having a hard time functioning. She has so much bone pain she can barely walk sometimes. She doesn’t eat much, she can’t sleep, she is losing her hair and her voice, she’s tired all the time, she can’t controll her body temperature, she’s short of breath and dizzy, she has near constant headaches, her blood pressure is incredibly high and variable, and she has to be on pain killers 24/7 just to survive. She was previously not one to be ill or go to the doctor. Since her doctor doesn’t know much he referred who to an endocrinologist, who unfortunately doesn’t know that much either, but he referred her to a general surgeon. The problem with a general surgeon is: #1 he doesn’t specialize in the surgery she needs to remove the parathyroid tumor(s) #2 if he uses standard surgical proceedures she is at a higher risk for blood clots, coupled with the fact that we have a family history of two different types of blood clotting disorders (G20210A and Factor 5 Leiden activated) #3 Standard surgical proceedures aren’t as effective for removal of the parathyroids as they are generally the size of a grain of rice #4 standard surgical proceedures have a higher incidence of a slew of incredible complications. We found a doctor who can do a MIRP (Minimally Invasive Radioguided Parathyroidectomy) proceedure, but he is not in our “network” and he’s in Florida and we live in Michigan. If we were to go out on our own to have this highly successfull specialist do the surgery my mother needs it will cost approx. $15,000 or more. Money we don’t have. My father already works two jobs. Is there a way to know or to guarantee that if we were to get donations from individuals at our church it wouldn’t be seen as taxable income? If no, then how much tax do they charge? Would we be able to just go above the amount needed in order to cover the taxes? What do we do if we ask for donations and receive more than we need? Could we start an organization to help other’s in the same situation? Part of our problem is that it is such a rare thing that there aren’t any organizations we’ve found that are dedicated to helping this particular disease, or that specialize in this area.