These charts from Smile Train imply an appealing story:
(a) Smile Train performs surgeries for $250 apiece.
(b) Smile Train’s main use of donations is to fund $250 surgeries.
(c) A donation to Smile Train funds more surgeries than would the same donation to another cleft palate organization.
(d) If Smile Train had much more money, it would fund many more $250 surgeries.
But after some basic investigation of their website and financials (and conversation with the organization), we believe that:
(a) Smile Train’s total expense per surgery is well over $250.
(b) Directly funding surgeries (the program focused on in the charts above) accounts for under half of Smile Train’s expenses.
(c) Smile Train makes direct grants to other cleft palate organizations, some of which use the same model as the “mission groups” that its charts imply are overly costly.
(d) If Smile Train had more money, it could mean more grants to “mission groups,” general education about cleft palate conditions, and a host of other activities, and would probably not mean more directly funded surgeries.
We feel that, as a result, many of Smile Train’s donors - including Prof. Steven Levitt of Freakonomics and Superfreakonomics - have a highly inaccurate picture of how their donations are used. Details follow.
(a) Smile Train’s total expense per surgery is well over $250.
The same Smile Train page linked above claims 90,000-95,000 surgeries provided in 2008. If this number is entirely correct (not exaggerated or estimated) and we divide it into the roughly $100 million of “money raised” shown above, we obtain a cost-per surgery of over $1000.
In fact, the situation is a bit more complex, because money raised doesn’t equal money spent. To get the latter, we can look at Smile Train’s most recent IRS Form 990, which puts total expenses around $85 million for an implied cost-per-surgery closer to $900.
It’s possible that some surgeries are performed for $250 apiece or less. But are these the surgeries you’re paying for when you donate? That’s where the next few points become relevant.
(b) Directly funding surgeries (the program focused on in the charts above) accounts for under half of Smile Train’s expenses.
Here’s the big picture on Smile Train’s expenses, as far as we can understand them from the most recent IRS Form 990:
“Treatment partnerships” appears to be the core program of funding developing-world doctors to perform surgeries.
The “No information available on website” item refers to $23.6 million spent on “provid[ing] materials on cleft lip and palate for free to anyone interested in this birth defect” (according to the Form 990). We have no other information about this activity.
“Education grants” appear to refer to training developing-world surgeons. “Treatment grants” appear to correspond to grants to other organizations.
(c) Smile Train makes direct grants to other cleft palate organizations, some using the same model as the “mission groups” that its charts imply are overly costly.
Prof. Steven Levitt of Freakonomics and Superfreakonomics writes,
The typical model for cleft repair in developing countries has been to convince U.S. doctors and nurses to volunteer a week’s time, fly to a country, and do 80 surgeries … Smile Train instead partners with and trains local doctors to do the surgeries, which turns out to be far more efficient.
In fact, Smile Train makes grants to a variety of other organizations, including some that focus on the “mission” model (flying U.S. doctors and nurses overseas). The most recent list of grants starts on page 18 of the Form 990, and includes:
- $1.4 million to GiveWell standout Interplast, which funds both missions and work with local doctors.
- $70,000 to Surgical Volunteers International and $25,000 to the Smiles International Foundation, both of which appear to be missions only.
- A wide variety of other grants, including for organizations focused on research, organizations that work primarily in the U.S., and more.
(d) If Smile Train had more money, it could mean more grants to “mission groups,” general education about cleft palate conditions, and a host of other activities, and would probably not mean more directly funded surgeries.
I first encountered some of these oddities back in 2006, and wondered why Smile Train wasn’t simply putting all available funds toward its most cost-effective surgeries (presumably, the ones that cost $250 each). The answer I got at that time was that there was a “doctor shortage” - Smile Train was paying $250 per surgery as much as it could, but had more money than it could use that way, so it engaged in other activities and made grants to other organizations.
Given this situation, I think Smile Train’s approach makes sense. How many charities are raising more cash than they can productively use, and sitting on it instead of giving it away to other organizations?
In terms of spending money it has appropriately, Smile Train may be doing well. But how it brings in that money is another question. When Steve Levitt doesn’t seem aware of how funds are being used, it seems to me that donors are getting the wrong impression.
Prof. Levitt notes that “One thing they don’t do, but maybe they should do, is literally link each $250 donation to a particular child and send before and after pictures.” Smile Train can’t take this suggestion, because it’s not providing a surgery for every $250 raised.
