As obvious as it would seem, the corpus of private foundations, endowments and pension funds are not invested in concert with their missions. This dissonance is like NASA trying to get to the moon in a car. 

But structural shifts are happening.  These shifts offer intriguing possibilities at the nexus of “health and housing”.  Recent Department of Labor and Treasury clarifications can unlock new capital investment from institutions and foundations by changing established notions of what fiduciary responsibility is and removing perceived barriers to institutional investments that align with the organizational missions. [see http://ssir.org/articles/entry/new_regulations_boost_social_impact_investing].  The Heron Foundation, for example, a member of Toniic’s 100% Impact Network, recently announced that its endowment will be fully invested in its mission, and we expect to see further similar announcements now that the perceived regulatory roadblocks have been cleared.  

Could these structural shifts result in a “moonshot” for how health can be influenced in low income communities?  A systems thinking approach is necessary and thanks to leadership from Kevin Barnett of the Public Health Institute (www.phi.org) and Michael Swack of the Carsey School of Public Policy (www.carsey.unh.edu), I recently participated in a convening of CDFIs and inter-disciplinary teams from hospitals, health providers and community stakeholders at the Federal Reserve Bank of Boston that provides a framework.  The Affordable Care Act creates a new paradigm: non-profit hospitals and health organizations can no longer protect their tax-exempt status by simply reporting charity cases and uncompensated patient care.  They are required to proactively identify their role in the community they serve by assessing and prescribing what work they can do to improve health in their Community Needs Assessment and then actively DO IT

With the urgent need in the US to arrest the declining health of our population it is only logical that insurance companies, health organizations and hospitals, faced with needs to find new alternatives to manage costs and hedge against penalties due for repeat customers, would invest in self-generating interventions.  I believe hospitals are searching for entrepreneurial ways in which they can both improve health and communities with their work while also meeting their responsibility to the IRS.  Likewise, it is in the best interest of insurance companies and health organizations to invest their capital for returns and in efforts that are coincidentally driving health outcomes in a direction that reduces costs and saves them money.  Investing their corporate assets in vehicles that generate improved health is just good common sense.

Those of us working in affordable housing for decades, anecdotally understand housing as a platform for improving a broad range of social outcomes- health chief among them- and, more recently, the evidence is now conclusive: housing drives health.  The lens through which health providers see housing as an important factor in the lives of patients is widening, as is that of the housing organizations that view health care as an important service to deliver to their tenants.  Collaboration is happening now because the health system and community development system see the mutually beneficial outcomes of working together to avoid costs: efficient, upstream, change that will drive more dramatically positive results in the long term AND provide a better life for low and moderate income people.   

While the amalgam “health and housing” is not a new idea, what is new is the confluence of 1) conclusive evidence confirming strong health outcomes from affordable housing done right; 2) high demand from a new class of “impact investors” and 3) regulatory support and incentive for institutional investors in the health sector to look to impact investing for solutions.

The Housing Partnership Network and its Members (www.housingpartnership.net), affordable housing developers who own over 200,000 units across the country, create interventions directly at the human level by influencing behavioral health, education about healthy lifestyles and safe access to healthcare, exercise and healthy food all of which can begin at a tenant’s home  As we deploy capital at scale from “impact investors,” we must seize the l opportunity to engage with health organizations and unlock capital from their asset base to be invested to generate returns. The time is now to address issues systematically and create sustainable, upstream changes to disrupt the negative cycles leading to poor health.

With the urgent need in the US to arrest the declining health of our population it is only logical that insurance companies, health organizations and hospitals, faced with needs to find new alternatives to manage costs and hedge against penalties due for repeat customers, would invest in self-generating interventions.

author

As president of the Capital Markets Companies, Becky develops and manages HPN's capital market relationships and oversees its neighborhood stabilization and foreclosure prevention enterprises. 

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