The growing reach and rising sophistication of local health foundations is one of the most important stories in institutional philanthropy, right now. These foundations, many of which were set up by nonprofit health organizations converting to for-profit status, often have substantial resources and are moving ever more grant money.
Earlier this year, we reported on research by the Bridgespan Group revealing that health conversion foundations are now pumping out over $1.3 billion in grants annually in their local areas, largely to help low-income Americans gain access to care. Some of these foundations have endowments the size of the national grantmakers, yet far narrower geographic mandates. For example, the Colorado Health Foundation has assets of $2.4 billion, and has given out as much as $97 million in some recent years—big money in a state with 5.5 million people.
But it's not just their size and relative newness that makes these health foundations such an important story to follow. It's also their increasing sophistication in how these grantmakers are thinking about health and health equity. Following the lead of better-known national funders like Robert Wood Johnson and Kresge, local health funders are focusing more on the social determinants of health—looking upstream at how to create a healthier population overall. They are also looking for ways to reform health systems to deliver better outcomes at a lower cost and focus more on prevention.
The Episcopal Health Foundation (EHF) in Houston is a great example of these emerging trends in local health grantmaking. With a focus on 57 Texas counties and over $1.2 billion in assets, this funder—which was only just created in 2013—has lots of resources and big plans.
EHF recently came out with its new five-year strategic plan to guide its future grantmaking. The blueprint sharpens the funder’s focus while also zeroing in on targeted outcomes. This is a significant shift compared to past efforts that more broadly identified interest areas for grantmaking.
The foundation is looking to achieve several outcomes to help level the playing field for Texans so that everyone has a chance at achieving good health.
The first outcome is to see more health system resources dedicated to improving health and not just healthcare, as well as getting low-income and vulnerable populations access to comprehensive care. EHF sees this as essential to creating a Texas where fewer people develop health problems to begin with. This is a recurring theme in the strategy blueprints of top grantmakers working in the health field today: It's much better (and cheaper) to address the leading causes of poor health and engage in effective prevention than to spend money heavily treating symptoms. Of course, America's $3.2 trillion health system is mainly geared around the latter priority, not the former, so it's hard to overstate the heavy systemic lift facing health grantmakers like EHF.
Elena Marks, EHF’s president and CEO said in a press release:
The health system in Texas is like an orchestra, and medical care is just one section on the stage. If all the health system offers is more medical procedures, then it doesn’t address all the other factors that determine health. Nonprofits, hospitals, community clinics, government agencies, churches, and other organizations need to be in concert together to allow all Texans to access the health system. And that system needs to deliver health, not just more healthcare.
The second EHF outcome is improving early childhood brain development. This is a much more targeted approach than simply awarding grants in the field of early childhood development, which can take many forms. The human brain grows the fastest during the first three years of life, and EHF is convinced that by focusing in this area, it can ultimately foster healthier and more successful adults. Here again, EHF is channeling an important current that's gaining traction in philanthropy right now, with more funders seeing this kind of very early intervention as a high-leverage way to improve a whole range of life outcomes.
With EHF's strategy, Texas nonprofits can expect more of its grants to go to brain development-focused programs that connect healthcare providers and pregnant women and families of young children. Community-based organizations that help families provide positive experiences and reduce negative experiences to facilitate better brain development will also see more funding.
A third new outcome in focus is raising community voices to become advocates for health close to home. This is an effort targeted at both nonprofits and church congregations, and it's also something we're seeing more of these days from top health funders. Given that nearly half of all health dollars in the U.S. are spent by public agencies, advocacy can yield huge dividends in terms of protecting key benefits and expanding health equity. It's another high-leverage strategy. The Colorado Health Foundation even went so far as to spin off a separate 501(c)(4) organization focused on public policy, as we've reported.
The distinction of focusing on outcomes rather than interest areas may seem like a subtle one, but it’s significant. This is a way to articulate what a foundation hopes to accomplish rather than just identify areas it's interested in working on. An outcome focus is more ambitious and dives deeper into specific components of large issues. For funders, this translates to being more selective about grantees and heightened evaluation protocols.
But through this new three-pronged approach, equity is EHF’s guiding principle. This is a religious organization, but one that is refreshingly innovative and that doesn’t fall into the traditional religious pitfalls of funding. As we’ve pointed out recently with other big, locally focused funders, EHF is looking to provide more than just money for program work on the ground. It’s heavily involved in research with its own research team and is also engaged in nonprofit education efforts to help groups assess their strengths and weaknesses to build capacity.
You can review the full EHF strategic plan for 2018 to 2022 here.