Taking a gamble on health
The logo for the We All Win Lottery. Does this fundraising technique really ensure “we all win?”
There was more than a bit of wailing and gnashing of teeth here in Ottawa last week.
The local children’s hospital, CHEO, and the Ottawa Hospital, were running a hospital lottery with a ticket deadline of midnight, Friday, June 22. And apparently, sales weren’t going well.
There were stories all last week in local media about how only about two-thirds of the “We all win” tickets (which cost $100) have been sold, and that this might reduce the money funding research at the CHEO Research Institute and the Ottawa Hospital Research Institute.
Then, on Sunday, we heard that disaster had been averted. The Ottawa Citizen reported that the lottery sold a total of 46,000 tickets. This was enough to allow the hospitals to break even and provide up to $500,000 in research funding, a drop from last year’s $900,000.
Hospital lotteries seem to have proliferated in Canada in recent years. According to the Dream Lottery site, a catalog of Canada’s charity lotteries, there are 15 in Ontario, and by my count of their listings, there are 45 across the country.
I’ve had a few health-care challenges, and I’m now of an age where I see friends experiencing all sorts of health issues. So I like hospitals and I like research. But is this the best way to fund research activities at hospitals?
Let’s take a quick and dirty look at the numbers. (By the way, I asked the hospitals and the foundations to contribute to this post on Friday, but have heard nothing from them.)
The lottery sold 46,000 tickets. Let’s assume that everybody bought single tickets, although some might have bought three at a time for a $50 discount.
| 46,000 tickets sold at $100 = | $4,600,000 |
| The grand prize = | $1,500,000 |
| Second prize = | $ 340,000 |
| Car prizes = | $ 200,562 |
| Vacation prizes = | $ 199,100 |
| Gift cards = | $ 160,000 |
| Revenue – prizes = | $1,501,238 |
| Research funding = | $ 500,000 |
| ??? (My suspicion is that there would be marketing, administration, legal, insurance, accounting and other expenses involved in this, and possibly other expenses.) = |
$1,001,238 |
Some notes on the assumptions I make here. I have maxmized the revenue generated. I have also used the face value of prizes. I suspect that the prizes are provided at lower than face value.
At first glance, it seems like there’s a lot of money being spent to administer a $4M program, and that something with a budget of $4 million is raising only $500,000 for the stated purpose.
Should hospital foundations be spending money to heavily market high-end lotteries which could be susceptible to local economic conditions (in Ottawa’s case, there are thousands of public servants who face uncertain futures after budget cuts)? And is it worth it for a chunk of their research funding pie that in the case of CHEO is less than 13% and only 5% for the OHRI?
There’s a social implication here, too. I hate to use the word “should” again, but should people have to be bribed with the chance of winning something to donate to these causes? Look at the headlines of what CHEO researchers did just last year:
- A potential treatment for Spinal Muscular Atrophy
- A way of using sugar water to reduce pain in infants
- A treatment for osteogenesis imperfecta
At the OHRI:
- New diagnostic tools for thrombosis, or blood clots.
- New, earlier ways of diagnosing Parkinson’s disease.
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