Transforming Medical Education: The Impact Of A $1 Billion Donation

Author Dalboyy 13 Nov 2024

A major philanthropic donation has been made to the Albert Einstein College of Medicine in New York City. Dr. Ruth Gottesman, a former teacher at the school, made the $1 billion donation. Dr. Gottesman is the widow of late billionaire David Gottesman. Her astonishing gift will allow students to attend the institution without paying a dime of tuition going forward.

That’s not the most amazing part of this story. Ruth Gottesman knew she and her husband were rich. After all, David was the founder of the privately-held bank First Manhattan. But she had no idea the full extent of their wealth until after David died in late 2022…

Ruth and David Gottesman were married from 1950 until his death in September 2022. They had three children together. David was the founder of the privately-held bank First Manhattan Co. Considering the fact that First Manhattan manages around $20 billion worth of assets for clients, it was no secret that the Gottesmans were very rich. The family home is a 7,000-square-foot mansion set on 1.6 waterfront acres in the ritzy town of Rye, New York. Their home’s estimated value, according to Zillow, is $7 million.

However, as Ruth recently revealed, she did not know the extent of the family's wealth until after David died. As it turned out, since the early 1960s, David Gottesman had been making deals with Warren Buffett and his company Berkshire Hathaway. They even formed a venture together called Diversified Retailing, as a partnership between Berkshire and First Manhattan. Every Sunday night for years, Warren and David would speak on the phone and share investment ideas.

David was an early and frequent buyer of Berkshire Hathaway stock. At one particularly low point in the 1960s, when the company’s share price was lagging, David and Diversified bought gobs of Berkshire shares at rock-bottom prices. In the 1970s, her Berkshire stake grew even more when the parties decided to merge Diversified Retailing into Berkshire. At the time of her merger, Berkshire Class A shares traded for $150. Today, a single Class A Berkshire share sells for $612,500.

Gottesman never sold a single share. According to Ruth Gottesman, she had no idea just how wealthy her husband was when he died in 2022. Altogether, the Berkshire Hathaway stock he left Ruth is worth $4 billion. “Do whatever you think is right with it” was his only condition.

$1 billion is the largest single donation that’s ever been made to any medical school in the United States, and it will now allow those prospective medical students who qualify for the school to attend regardless of financial resources. As Dr. Yaron Tomer of the college put it in a press statement:

“This donation radically revolutionizes our ability to continue attracting students who are committed to our mission, not just those who can afford it. Additionally, it will free up and lift our students, enabling them to pursue projects and ideas that might otherwise be prohibitive.”

The Gottesmans had donated to the institution before, including a $25 million donation made in 2008. Now, not only will future students at Albert Einstein not have to pay tuition, but current fourth-year students will be reimbursed for the spring tuition.

Key Takeaways

Dr. Ruth Gottesman's $1 billion donation will eliminate tuition fees for future students at Albert Einstein College of Medicine.
Ruth Gottesman was unaware of the full extent of her family's wealth until after her husband's passing in 2022.
David Gottesman had a long-standing investment relationship with Warren Buffett and Berkshire Hathaway, leading to significant wealth accumulation.
The donation represents the largest single contribution to a medical school in the U.S., transforming access to medical education.

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