Multimillion-Dollar Investment Initiative to Spark Collaboration Between Entrepreneurs and Community Health Centers
Foundations to invest in companies with solutions for community health centers
Today the California HealthCare Foundation (CHCF) and The Kresge Foundation announced a multimillion-dollar initiative to invest in for-profit and nonprofit companies that serve community health centers. Over the next three years, the Partnering for Impact initiative will invest at least $5 million in several companies that have technology- or service-based solutions that help community health centers and clinics make their resources go further, increase patient access to care, and/or lower the cost of providing care.
CHCF and Kresge both have experience investing in efforts that strengthen the health care safety net. To date CHCF has invested approximately $7 million in debt and convertible debt with companies that help low-income Californians and the providers who serve them. Kresge, a national philanthropy, has supported the expansion of community health centers through loans, deposits, and guarantees. This new partnership represents a widening of Kresge’s social investment portfolio to include direct investments in companies, and a broadening of CHCF’s pipeline to include companies that do not yet operate in California. The foundations will share due diligence, advisory activities, and legal costs.
“We look for investments where there’s opportunity for impact, where we can help attract capital from other sources, or where we can buffer the risk in piloting new financing structures,” said Kimberlee Cornett, who directs Kresge’s Social Investment Practice. “We’re delighted to work with CHCF, have the benefit of its experience, and bring what we’ve learned about community health centers to the effort.”
Historically charged with providing primary care to vulnerable populations, community health centers and clinics are now looking to expand their services and build their capacity to care for the 20 million Americans who will be newly insured under the Affordable Care Act. To reach their goals, community health centers and clinics across the country increasingly are partnering with companies that offer low-cost solutions to improve health care access, efficiency, and affordability.
“Through this initiative we want to identify and invest in companies that bring value to health centers and their patients,” said Margaret Laws, director of CHCF’s Innovations for the Underserved program, which leads its program-related investments. “We are looking for companies that already serve health centers and are ready to scale, as well as those that are motivated to bring their solutions to underserved markets.”
To be eligible for investment, entrepreneurs must be based in the United States and demonstrate how their product or service can maintain or improve patient experience while accomplishing one or more of the following goals:
- Enhance health center efficiency by at least 20%
- Increase access to highly needed health service(s) for 100,000 patients annually
- Reduce costs by $25 million annually
In addition to receiving funding, selected companies will be paired with community health centers and clinics ready to implement new solutions, along with mentors experienced in community health center management, technology, and public payment issues. Grant funding for technical assistance and evaluation may also be available.
- Companies must apply online.
- A subset will be selected for further review and additional information will be requested.
- Proposals will be accepted on a rolling basis throughout the initiative.
This press release was updated March 31, 2014, to reflect that the CHCF Health Innovation Fund has invested approximately $7 million to date, not $10 million.
About the Kresge Foundation
The Kresge Foundation is a $3 billion private, national foundation that works to expand opportunities in America’s cities through grantmaking and investing in arts and culture, education, environment, health, human services, and community development efforts in Detroit. In 2013, Kresge’s board of trustees approved 316 awards totaling $122 million; $128 million was paid out to grantees over the course of the year. In addition, Kresge’s Social Investment Practice made commitments totaling $16 million in 2013. For more information, visit kresge.org.
About the California Health Care Foundation
The California Health Care Foundation is dedicated to advancing meaningful, measurable improvements in the way the health care delivery system provides care to the people of California, particularly those with low incomes and those whose needs are not well served by the status quo. We work to ensure that people have access to the care they need, when they need it, at a price they can afford.