You can’t blame them, really. You can’t fault state legislators for looking for fiscal relief from the foundations created when not-for-profit health plans become for-profit entities. The organizations are expected to dispense around $450 million a year to widely diverse causes that fall under a broad — very broad — description of a public health effort.
Hey, said then Gov. George Pataki in a New York minute, let’s use that money to increase the salaries of state health care workers. And he did, taking $1 billion generated when Empire Blue Cross & Blue Shield became a for-profit company.
Sure there were protests and even a lawsuit. Yet, according to our cover story on page 16 by contributing editor Maureen Glabman, when the dust cleared, Pataki got his and the foundation was left with a paltry $50 million. Many readers will remember how it all went down.
Other states are using different means to dip into foundations because it’s clear that help from the federal government will not be coming. The administration projects that the federal deficit for 2009 will be a record-breaking $482 billion. Meanwhile, problems in the mortgage industry persist while the price of crude oil fluctuates. What’s a responsible lawmaker to do? Just say no?
The Pataki raid represents two main problems with foundations: They sometimes lack direction and too often find themselves prey to government overseers more than willing to give them that direction. Meanwhile, lost in the headlines is the original purpose. The foundations were meant to provide funding and initiate programs in their communities to compensate for years of foregone state taxes that allowed the not-for-profit plans to grow.
The foundations have mostly stuck to their mission, but you have to wonder, for how much longer?