Carsoncare

Carsoncare: The doctor's ill-fated dream of solving America's health care woes

Ben Carson set up a fund to help needy patients but most of its money went to overhead.

By Isaac Arnsdorf  and Kyle Cheney

Read more: http://www.politico.com/story/2015/11/carsoncare-the-doctors-needy-patients-fund-that-went-nowhere-216111#ixzz3sWDnA5uj
Republican presidential candidate Ben Carson thought he had a way to create a system of universal health care to cover millions of uninsured Americans. In 2003, he helped set up a charity to test his bold idea and build a fund of contributions to dole out to needy patients.

Long before he considered a presidential bid, the world famous neurosurgeon envisioned building Angels of the OR into an endowment that would generate enough interest income to cover uninsured patients expenses for neurological surgeries and other medical costs. He even pitched the idea to a congressional subcommittee in 2006, testifying that a small federal grant could help the charity prove that the concept could work on a grander scale.

“We're looking forward to a time when we can use our God-given talents once again to stomp out disease and maybe even help to create a model for national medical access,” he told a House appropriations subcommittee.

But it didn't work out that way: The national fund did not materialize, and over nine years of operation, Angels of the OR [Operating Room] generated less than $150,000 for patient care and helped 34 patients cover portions of their medical bills, according to its tax forms. Carson had said he wanted to raise as much as $20 million in seed money, but the charity collected less than $1 million from donations and celebrity-studded events — like a private benefit headlined by Kenny Rogers and the 2003 film premiere of “Stuck on You,” in which Carson made a cameo appearance.

Angels of the OR spent $1.03 million during its life span, and at least 53 percent of its funds went to salaries and fundraising costs, according to POLITICO’s review of its records.

The charity shut down in 2013 when Carson stepped down as director of pediatric neurosurgery at Johns Hopkins Hospital.

It was a quiet end to an effort that Carson once described as “revolutionary” and destined to help solve the problem of providing medical services to the needy. In his 2007 book, “Take the Risk,” Carson suggested that if the nation could set aside one of every seven health care dollars into such an endowment for at least a decade, the result would be a $3 trillion health care fund, “large enough to fund American health care forever.”

But he hasn't yet mentioned the idea of a health care endowment on the presidential campaign trail. Instead, his discussion of health care has focused on scalding critiques of President Barack Obama’s health care law and a pitch for a system of health savings accounts to take the place of entitlement programs like Medicare and Medicaid. He suggested in recent weeks that he’ll soon unveil a new health care plan. And despite a deep-seated commitment to the power of charity — his much-praised Carson Scholars Fund has awarded more than $4.2 million in scholarships to 6,700 students, according to its website — Carson hasn’t cited Angels of the OR in his health care plans. The Carson campaign declined to comment for this story.

Joseph Chadwick Jr., an investment adviser and former president of Angels of the OR, called the charity “modestly successful. We gave it a try.”

He told POLITICO the organization wound down because donors expected Obama's health reform to take care of the problems the charity was trying to address.

“Because it wasn’t really going anywhere, and we felt it would be some time before we could get effective interest because of the belief that the Affordable Care Act was going to take care of these issues, we then put it into a passive category,” Chadwick said.

Susan Thompson, a nonprofit administrator who served as the charity's executive director for less than a year, described it as a well-intentioned effort that never gained traction. She said most decision-making was “driven by the board of directors” and that the organization functioned in “fits and starts.”

Experts in nonprofit management who discussed the charity’s tax forms with POLITICO said Angels of the OR never developed a sound business plan and spent much of its early income on fundraising and personnel rather than patients.

“There is no clear pattern of operation here,” said Christine W. Letts, a senior lecturer in nonprofit leadership at the John F. Kennedy School of Government at Harvard University. “It is clear that they never had consistent fundraising, and in the later years, it dwindled to very little.”

Mike Burns, a consultant with BWB Solutions, a national consulting firm in Branford, Connecticut, called the charity’s grants “disproportionately small” compared to its expenses, especially in 2008, when it spent only $10,000 on what its tax returns categorized as “patient services.”

“The rule of thumb is 75 percent toward program-related initiatives and 25 percent for administrative stuff,” said Will Brown, a professor and director of the nonprofit management program at the Bush School of Government and Public Service at Texas A&M University.

Desiree Adaway, a 30-year veteran of nonprofit management, said Carson's charity may have fallen into a trap faced by thousands of nonprofits. Heavy startup costs drain money, then donations fall off. “A lot of them are floundering because they don’t have resources,” she said.

Chadwick told POLITICO that almost all of the money spent on patient services went into a “patient relief fund” operated by Johns Hopkins, which performed largely the same function as Carson’s charity — covering costs of care for patients who couldn’t afford it on their own. The charity paid $135,000 into the Hopkins fund.

But Lynn Salganik, a Maryland consultant who worked as treasurer for Angels of the OR, said its tax records do not reflect the full range of assistance it provided patients. She said it arranged for no-cost care for many patients without having to use its own funds. “A mention of Dr. Carson, that would open doors,” she said.

Carson originally set up the medical charity as the Benevolent Endowment Network, or BEN Fund, with an emphasis on children. He and another Johns Hopkins Hospital neurosurgeon, Clifford T. Solomon, expanded the project to cover medically needy adults and changed the charity’s to name to Angels of the OR. Solomon, who testified alongside Carson at the House hearing in 2006, did not return phone calls. He is not listed as a Carson campaign donor. Today, Solomon leads the University of Maryland Baltimore Washington Spine & Neuroscience Center.

In describing its mission, the charity said it hoped “to conduct a range of surgeries at Johns Hopkins Hospital, to finalize legal issues and apply/secure for insurance coverage, [and] to develop approach to request congressional funding award.”

In March 2006, Carson and Solomon testified before the House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies, asking for a “small investment of federal dollars.” Both doctors described desperate patients who needed brain surgeries but could not get medical attention without insurance. The charity’s filings show no record that any such appropriation ever came. Carson testified that he had invested $70,000 of his own money to get the charity going, but after its first year, the nonprofit did not list its donors.

Carson and Solomon said during their committee appearance that they had spoken to celebrities like cyclist Lance Armstrong and former Tennessee Sen. Bill Frist, another doctor-turned-politician, about securing support for their effort. The charity held a December 2006 fundraising event at Baltimore’s Hippodrome headlined by Kenny Rogers, according to a news account.

Carson testified that he grew discouraged by the financial struggles faced by uninsured patients. “This reached the point where I was about to leave medicine about six years ago and then came up with the idea of creating an endowment, the interest of which could be used to take care of such people,” he said.

But Angels of the OR operated at a deficit after its first two years. It invested in furnishing a Baltimore office and establishing a website that included an application for medical assistance.

It paid out $50,000 for “patient services” in 2006 and $15,000 in 2007, the tax filings show.

Contributions fell off in 2008, and the charity spent $12,500 to help 15 patients in 2008 and 2009, according to its tax forms. It tried to reduce overhead costs by turning over some of its work to another charity, the Baltimore Community Foundation, which charged it $12,000 in fees, according to foundation spokeswoman Gigi Wirtz.

In 2010, the group reported helping five patients, allocating $2,837. That same year, it spent $4,832 to purchase tiles from Hopkins' historic dome that it could resell to raise funds.

The charity's endowment — which was supposed to be a vehicle for generating interest income — peaked at $372,902 in 2006 and dwindled to $13,503 by 2011. The fund never earned more than $7,200 a year from investments, which included, at one point, $2,274 of Coca-Cola stock, according to the tax forms.

The organization's website highlighted 10 success stories, including how the organization helped a family pay its deductible for a daughter's MRI, gave $5,000 to help a 47-year-old Virginia man pay out-of-pocket expenses for brain tumor surgery and funded $5,000 for a woman who needed a transfusion. The descriptions acknowledged that Angels of the OR defrayed only a fraction of the patients' medical costs for expensive procedures.

“Just a couple weeks ago, I remember seeing a young family, devastated, had just found out that their 5-year-old had multiple brain tumors,” Carson said in a 2008 promotional video in which he and Solomon appealed for donations. “There were multiple financial obstacles that precluded this patient from being able to be taken care of here. But through Angels of the OR we were able to overcome those obstacles. That child underwent successful surgery last week.”