By Suzanne Perry

The value of investments held by 143 nonprofit health-care organizations that participated in an annual study fell an average 21.2 percent in 2008 — by far the worst results since the study began in 2002.

By comparison, the average investment gains in previous studies were 8 percent in 2007, 10.6 percent in 2006, and 6.3 percent in 2005. The only other negative return, of 4.9 percent, was reported in 2002.

The studies are conducted by the Commonfund Institute, the research arm of Commonfund, a group in Wilton, Conn., that manages investment funds for nonprofit groups and educational institutions.

The health-care organizations at least fared somewhat better than other parts of the nonprofit world. Foundations suffered investment losses of 26 percent, and charities of 25.8 percent, in 2008, according to separate Commonfund studies.

Other findings of the health-care study:

The participants’ average operating budgets were $990-million, up from $921-million in 2007. But capital spending fell from $149-million to $109-million. For the fourth consecutive year, participants reported higher debt levels — $681-million, up from $580-million in 2007. Debt ballooned to almost 123 percent of investable assets — up from 92.1 percent the previous year. The organizations that saw the best returns were those that allocated a large percentage of their assets to fixed-income investments. But John S. Griswold, executive director of the Commonfund Institute, said that putting so much money into one kind of investment, and with so few stocks, was a bad strategy.

“While this type of allocation worked well in FY 2008, that year was an outlier,” he said in a statement. “Over the longer term, it is almost assured to preserve neither asset values nor spending in real terms.”

The 2009 Commonfund Benchmarks Study of Healthcare Organization is available free to Commonfund clients and nonprofit groups. Others may purchase copies for $500. To order a copy, click on the following link.