Is There Synergy in Community Development Financing and Population Health?

Originally posted 11/9/2011

It’s been more than a year since I first blogged – with some incredulity – on the first Federal Reserve Healthy Communities Conference.

The Healthy Communities Initiative was created by the Federal Reserve System and the Robert Wood Johnson Foundation to encourage stronger linkages between community development and health. That first meeting, in July 2010, was devoted to building bridges and understanding between two fields with potential for synergy in goals and resources but very little else in common (including language).

This week I attended a follow-up meeting called Healthy Communities: Building Systems to Integrate Community Development and Health. Sponsored by the Federal Reserve Bank of San Francisco, the Robert Wood Johnson Foundation, and the Pew Charitable Trusts, the meeting brought together about 120 leaders from academia, foundations, banking and finance, and the federal government (including the White House, HUD, DOE, DHHS, and EPA).

The purpose of the conference was to “highlight promising new models and explore three areas of system reform that are urgently needed to formally align community development and health: data, capital, and policy.” Morning sessions focused on “working together” (regional models, lessons, and strategies for scale) and “bending the cost curve” (integrating health and community development). Three afternoon sessions targeted system changes in the three priority areas – capital, data, and policy.

The event was coordinated with the release of the November issue of Health Affairs, which is devoted to Community Development and Health. Conference organizer David Erickson (of the San Francisco Federal Reserve) and Nancy Andrews (CEO of the Low Income Investment Fund) create a sense of the potential in their joint article:

The community development ’industry’—a network of nonprofit service providers, real estate developers, financial institutions, foundations, and government—draws on public subsidies and other financing to transform impoverished neighborhoods into better-functioning communities. Although such activity positively affects the ‘upstream’ causes of poor health, the community development industry rarely collaborates with the health sector or even considers health effects in its work. Examples of initiatives—such as the creation of affordable housing that avoids nursing home placement—suggest a strong potential for cross-sector collaborations to reduce health disparities and slow the growth of health care spending, while at the same time improving economic and social well-being in America’s most disadvantaged communities.

As in last year’s meeting, both sides were still learning about each other’s language and ideas but were much closer as to the shared purpose of their work regarding healthy communities. We learned that the community development field generates some $50 billion in annual investment for healthy housing, small business, quality community child care, education and health facilities, and now, increasingly local food systems. Population health participants stressed the need for synergistic investments early in the life course, the need for cross-sectoral business models supporting such investments, and the kinds of data that we have and need to support such investments.

For me, and many others from the health “side” of the discussion, the scope of resources in play was dazzling, but the structure and functioning of innovative funding mechanisms and vehicles (ever heard of “progressive capital”?) were still foreign territory. While the promise of health-promoting investment coming from and working synergistically with community development dollars is appealing in this austere environment, the finance experts stressed that there is no free lunch and that even these efforts need to generate cash flow or savings to work. There was discussion about government or philanthropy playing the important role of the guarantor of the initial risk of uncertain investments. The need to put a dollar value on health improvement was stressed repeatedly.

I left the meeting wanting to believe in the possibility of synergy, but with some degree of skepticism. I think there is exciting opportunity in such innovative cross-sectoral investments and partnerships. Even modest connections of population health with the many billions invested in community development would be a huge addition. We will need concrete examples of success or failures to help bridge the language and understanding gaps between the sectors, but it feels like there is a willingness and even eagerness to go forward. Let’s not let this become a case of what seems too good to be true actually being too good to be true.

So, I will read all the papers in the Health Affairs issue carefully to increase my understanding and will continue to actively explore partnerships with Community Development Financial Institutions both nationally and locally…and I hope you will also.

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