Where does the money come from?
Sources includes how local wellness funds find the fiscal resources to operate, the nature or type of these resources, and how they are often combined or aligned to support the collaborative effort.
For years, multisectoral partnerships have relied heavily on “short term, often insecure financing mechanisms such as grants, contracts, and prizes” to support health and wellbeing in their communities.”¹ In an effort to minimize the dependence on these mechanisms, communities around the country are finding innovative ways to blend, braid, or align fiscal resources to more sustainably support population health initiatives using the concept of a local wellness fund.²
Local wellness funds are mechanisms for bringing funding sources together. A wellness fund’s strength lies in its ability to pool or link diverse funding streams, which promotes sustainability and allows the fund to invest in larger, historically underfunded projects. Wellness-fund-supported projects can continue even if one source cannot be sustained or becomes unavailable.
To learn more about each element, select the name of the element.
There are many potential sources of funds that local wellness funds might combine, or pool to finance or pay for their initiatives. These include:
- Community banks
- Direct appropriations from state or local funds including tax revenue
- Flexible federal and state funding streams
- Medicare, Medicaid, Children’s Health Insurance Program
- Health plans or insurers
- Hospitals or health systems, including community benefit obligations
- Individual donors
- Philanthropic grants
- Private sector investments from businesses
- Reinvestment from shared savings incentives
One organizing framework of the elements that comprise sources are included in Table 1.
Table 1: Elements of Sources
(Where is money coming from?)
- Public sector (Federal, state and local government)
- Private Sector
- Health Care Sector
- Philanthropic and nonprofit sector
- Other sectors (nontraditional)
- Bonds
- Catalytic Capital
- Dedicated Public Revenues (taxes)
- Donations
- Earned Income
- Grants
- Health Care Payment Models
- Impact Investing
- Loans
- Other public appropriations and mandates
- Savings capture and reinvestment
- Other Innovative models
Blending
Bringing together multiple funding sources into one funding stream. Blending requires unrestricted, flexible sources that do not have to be tracked back to the original source through evaluation and reporting.
Braiding
Managing multiple funding streams to address a common objective that tracking, accounting, and reporting back to their original source are required. “Expenses, management data, performance measures, and demographic and other reporting requirements can be tracked and attributed to the original funding streams.”⁴
Aligning
Facilitating and managing separate streams of funding that may be used to address multiple objectives. These funds are never pooled and are tracked and accounted for separately.
- Public Sector (Federal, state and local government)
- Private Sector
- Health Care Sector
- Philanthropic and nonprofit
- Other sectors (nontraditional)
- Bonds
- Catalytic Capital
- Dedicated Public Revenues (taxes)
- Donations
- Earned Income
- Grants
- Health Care Payment Models
- Impact Investing
- Loans
- Other public appropriations and mandates
- Savings capture and reinvestment
- Other Innovative models
Bringing together multiple funding sources into one funding stream. Blending requires unrestricted, flexible sources that do not have to be tracked back to the original source through evaluation and reporting.
Braiding
Managing multiple funding streams to address a common objective that tracking, accounting, and reporting back to their original source are required. “Expenses, management data, performance measures, and demographic and other reporting requirements can be tracked and attributed to the original funding streams.”⁴
Aligning
Facilitating and managing separate streams of funding that may be used to address multiple objectives. These funds are never pooled and are tracked and accounted for separately.
Identifying sources can be difficult, particularly when a local wellness fund is just getting started. “Mapping the money in the system” is a critical first step in understanding the funding landscape. Bringing together a diverse mix of stakeholders from different sectors will help a fund identify a wider array of potential sources. Maps can be revisited and updated regularly by both new and existing wellness funds regardless of their age.
There is no one right way to start a local wellness fund. Some wellness funds begin with a single source. Others may have multiple sources.⁵ While there is no one-size-fits-all approach, there are some strategies than can make getting started easier. Securing catalytic capital can minimize risk and help attract other investors.⁶ Seed grants from philanthropic funders also allow local wellness funds to cover start-up costs associated with establishing the fund’s structure.
Based on research conducted by the Georgia Health Policy Center as part of the Bridging for Health: Improving Community Health Through Innovations in Financing, supported by the Robert Wood Johnson Foundation, starting with multiple small donors is relatively common.”⁷ As funds mature, they may consider pursuing more innovative sources, looking for ways to reallocate existing sources and identify new sources.
