From The Field M A R C H 2 5 , 2 0 1 3 Creating a Culture for Innovation and Risk Taking in Transformative Times TYM ROURKE, M.A. Director, Program Department and Substance Use Disorders Grantmaking, New Hampshire Charitable Foundation LISA R. SHUGARMAN, PH.D. Director of Policy, The SCAN Foundation LIANE WONG, DR.P.H. Children, Families, and Communities Program Officer, The David and Lucile Packard Foundation T he Great Recession challenged philanthropic organiza- prevention services. This strategy has evolved to include grant- tions, as well as their partners and grantees, to balance making and community advocacy, coming to include direct fewer resources with greater needs. By tightly focusing engagement in advocacy on issues that influence substance use on strategy, foundations may have unintentionally limited financing and policy. Additionally, the foundation serves as experimentation and bolder action at a time when both were “quiet counsel” to state leaders crafting and implementing needed to preserve progress and set the stage for future change reforms that affect those touched by alcohol and other drug and innovation. Today the country is still addressing broad abuse. This includes corrections reform and addressing a host economic and fiscal challenges, and philanthropy, govern- of politically-charged issues that could affect the foundation’s ment, and the private sector stand at a juncture where role and reputation. With provisions in the ACA to establish opportunity looms much larger. There is a clearer path ahead equitable access to care for what is now considered a chronic with the Affordable Care Act (ACA) and renewed focus on health condition, the foundation finds itself once again enter- public health issues, including gun violence, behavioral health, ing the dialogue with a clear stake in the ground on how the and chronic disease prevention. We hear the clarion call for broader public should respond to the opportunity. innovation, which is often paired with risk. Following are Extremely close communication between staff and the board three funder perspectives on how each organization is provides the space for highly strategic conversations, building approaching innovation and risk taking. confidence in the foundation’s decisions about this strategy. Potentially risky decisions are vetted through the board of THE NEW HAMPSHIRE CHARITABLE directors, with an eye toward thoughtful planning and FOUNDATION: RISK TAKING AS STRATEGIC consensus on how far staff should take a particular strategy. IMPERATIVE Advocacy grantees also serve as partners, providing counsel to foundation staff. What results is bold action–sometimes New Hampshire is ranked as one of the healthiest states in the unseen by the general public–that brings the foundation into a nation; however, rates of alcohol and other drug misuse are central role of catalytic engagement. among the highest. Given the interconnections between sub- One of the most intractable issues in the state requires stance use disorders and negative behavior, addiction remains a nothing less than all of the foundation’s assets–social as well highly stigmatized disorder. Addressing substance use also as financial–to truly move the needle. It is with this touches hot button areas of public discourse– public safety, understanding that the foundation continues to push the corrections reform, rights for those in recovery, and the role of boundaries, with the weight of the institution, its leaders, government in funding services for an illness not largely grantees, and trusted allies kept close in the work. financed through public or private insurance. The New Hampshire Charitable Foundation has worked for THE SCAN FOUNDATION: AN INCLUSIVE more than a decade to reduce the burden caused by alcohol, APPROACH TO ACHIEVING SYSTEM tobacco, and other drugs in the state. The foundation TRANSFORMATION prioritized public policy and advocacy early on to advance state financing, thereby increasing access to treatment and More than 9 million Americans are eligible for Medicare and Medicaid (known as “dual eligibles”), and a disproportionate of conversations on the state of innovation and risk taking number of them have chronic health conditions and func- across the foundation and within the Children, Families, and tional limitations. With separate funding and regulatory Communities (CFC) program. CFC’s broad mission spans two systems providing and financing their care, services for dual inter-related and fundamental areas, health and education. eligibles are fragmented with little coordination across Within the health program, grantmaking and investments for providers, contributing to high utilization of–and costs the five years leading up to passage of the ACA largely focused for–medical and supportive services. on advocacy, networked strategic communications, technical The ACA established the Medicare and Medicaid assistance, and state partner capacity building with the goal of Coordination Office (MMCO) within the Centers for achieving at least 95 percent coverage of children by 2012. In Medicare and Medicaid Services, aiming to ensure that dual spite of the economic downturn, nearly 93 percent of eligibles have access to integrated, seamless, and more American children have coverage. With the opportunities now efficient care. MMCO has established the Financial afforded through ACA implementation, the foundation is Alignment Initiative to test capitation and managed fee-for- mapping strategies that encompass parental coverage and that service models integrating the financing and delivery of support integrated solutions for family access to quality health Medicare and Medicaid benefits for dual eligibles. Several care. Key questions posed in the planning process include: states, including California, are pursuing opportunities • How do we source new ideas in health system innovation presented by the initiative. and tap into fresh thinking toward ensuring that future The SCAN Foundation has made significant investments generations of children and families are included in supporting integration for dual eligibles. This venture is innovation? inherently risky. In California, success of its demonstration relies on myriad factors, including appropriate rate methodol- • Do we have flexibility in our portfolio to experiment ogy incentivizing integration and quality, adoption of new with public/private solutions, and is there a target balance care coordination models by health plans incorporating sup- of risk? portive services, effective medical provider outreach to secure • How are we currently supporting and learning from support and participation, and successful consumer education experimentation? And what strategies can be used to support accounting for a culturally diverse population. experimentation and bring different investors together to In order to navigate the risk associated with integration and increase the impact of our investments? to mitigate this risk, the foundation employs a conceptual framework envisioning a more person-centered system of care While innovation is not new to the foundation, many of the called Five Pillars of System Transformation. This framework questions posed in the context of program planning have guides investments, calling out specific opportunities to stimulated different explorations in sourcing new ideas, carving organize medical and long-term care to achieve this desired out up to 20 percent in a portfolio for experimentation, and system. The five pillars are: 1) administrative reorganization, have sparked different configurations of cross-program 2) global budgeting, 3) universal assessment, 4) integrated dialogue around innovation. information systems, and 5) quality measurement and monitoring.1 CONCLUSION The culture of innovation within the foundation is one of inclusivity. We utilize the Five Pillars framework to gain broad The coming decade will be one where philanthropy must stakeholder participation. It is not about taking sides in this define its catalytic role with ACA implementation by investing endeavor; it is about supporting engagement and an “all- in advocacy to shape policy and practice, aligning larger pools comers” approach with an eye always on the prize of transfor- of public and private dollars to advance long-term goals and mation toward a more person-centered and integrated system. priorities, understanding and embracing failures, supporting This guides the foundation’s philanthropic investments and learning and knowledge transfer, and engaging new partner- supports endeavors that are inherently more risky. ships for collaboration around common goals. At this time of transformative opportunities, these are all worthy risk areas for THE DAVID AND LUCILE PACKARD philanthropy to lead and participate. FOUNDATION: EXPANDING INNOVATION IN CULTURE AND STRATEGY As The David and Lucile Packard Foundation nears its 50th year milestone, board and staff have recently opened a series The authors are fellows of the 2012 Grantmakers In Health Terrance Keenan Institute for Emerging Leaders in Health Philanthropy. 1 An in-depth description of the five pillars and The SCAN Foundation’s vision for system transformation is available at: www.thescanfoundation.org/scan-foundations-framework- Views from the Field is offered by GIH as a forum advancing-integrated-person-centered-care. for health grantmakers to share insights and experiences. If you are interested in participating, please contact Osula Rushing at 202.452.8331 or orushing@gih.org.