Charities Often Restructure to Protect Corporate Assets
Threats of high litigation verdicts and a crisis in obtaining insurance caused many charities to restructure their organizations to create separate “foundations” to protect their reserve assets a couple of decades ago. Prior to that, many hospitals had created foundations in order to maximize their reimbursements for medical services. Both the wave of huge adverse verdicts and the difficulty in obtaining insurance have waned over the years. Hospital reimbursement has changed so foundations no longer increase hospital income. But many charities are continuing to restructure today, both to protect their assets and to provide greater flexibility in the programs they undertake.
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