Caring for the Whole Child: A New Way to Finance Initiatives to Improve Children’s Health

Health Highlights

Editor’s Note: In a new issue brief prepared on behalf of the Robert Wood Johnson Foundation and the Nemours Children’s Health System, Manatt Health describes a pathway to ensure that children and their families benefit from investments in social determinants of health (SDOH). The brief, summarized below, reviews options for designing and implementing a Children’s Health and Wellness Fund, highlighting different models that can address the core components of a Fund. To download a free copy of the full issue brief, click here.


A growing recognition that socioeconomic factors affect health outcomes in significant ways is fueling new community investments and changes in healthcare delivery systems.1 These factors refer to “the structural conditions in which people are born, grow, live, work and age” that have profound implications for an individual’s overall well-being.2 Addressing SDOH needs for children and their families is particularly important in light of the strong evidence that investments in the earliest years can have a potent impact on children’s development and their ability to thrive and grow to be healthier adults. Yet children have largely been left behind with respect to SDOH investments in part because the financing for these initiatives has relied heavily on the potential for a relatively short-term return on investment (ROI) for the health sector.

SDOH interventions focused on children will produce health-related financial returns but typically on a longer time horizon, and they often will result in savings outside the healthcare sector (for example, to the child welfare system), giving rise to what is known as the “wrong pockets” problem. Given the extraordinary impact that the COVID-19 pandemic is having on the well-being of children, and most notably children of color, the urgency to act could not be more apparent.

A Children’s Health and Wellness Fund is a way to galvanize efforts focused on SDOH investments for children. On the most basic level, a Fund offers a mechanism to address the wrong pockets problem by facilitating a shared financing approach that reflects the shared interest and benefits of the many sectors that serve children—including healthcare, education, child welfare and juvenile justice.

A Fund can attract, collect and administer funding derived from different sources that can help finance “whole child” care. Sources of funding can be diverse, including public and private funds that build on investments that ought to be made through Medicaid and the Children’s Health Insurance Program (CHIP). But a Fund can be more than a bank account that facilitates multisector investments and spending; by bringing together diverse actors, all with a strong interest in children, a Children’s Health and Wellness Fund can focus attention on children’s needs and spur action on their behalf.

Key Issues

Below are key issues around designing and implementing a Children’s Health and Wellness Fund. Critically, decisions across all these areas require leadership from and close collaboration with the community to be served and a consistent and focused attention on promoting equity.

  • The overall framework for the Fund and the activities it supports. Planning for a Children’s Health and Wellness Fund must begin with foundational decisions about the vision and administration of the Fund. Planners must determine how it will be organized (e.g., as a statewide or local initiative), how funds will be disbursed, what the target population of children will be and how it can—at every step—enhance equity. In addition, Fund planners must consider how the Fund will align with existing efforts to address children’s social and developmental needs.
  • Fund responsibilities and mechanisms for oversight. Central to launching a Children’s Health and Wellness Fund is defining the scope of the Fund’s responsibilities and establishing a governance structure that can competently execute those responsibilities. For example, will the entity that establishes the Fund also carry out operational responsibilities, or will those be taken on by a partner organization or organizations? The scope of the Fund’s responsibilities will inform its decisions about its governance body—including who participates and what its core functions are.
  • Potential sources of funding. There are many options for financing a Children’s Health and Wellness Fund. Key to success is identifying the public and private actors that have a particular interest in children’s healthy development and that benefit from positive health outcomes. This is not “charity”—it is a shared investment with a shared return. Additionally, reliance on a mix of sources will help grow the Fund and promote sustainability; if one funding source later becomes unavailable, operations can continue. Sources of funds reviewed include:  


    State requirements or incentives for Medicaid managed care organizations to invest a portion of revenue/profits into the Fund.

    Engaging hospitals and hospital systems, including those that have community benefits obligations under federal (and possibly state) law.

    CHIP Health Services Initiatives that permit investments that benefit low-income children.

    Direct appropriations from state or local funds, or earmarking a portion of new or existing taxes, fees or appropriations to various child-serving agencies.

    Leveraging flexible federal funding streams that can be directed toward addressing health-related social needs for children.

    These financing mechanisms are not mutually exclusive and, as noted, sustainability is promoted by relying on a mix of sources. Challenges in “blending or braiding” funds can be minimized to the extent that the target populations and allowable uses for the funds can be aligned, but that is not always possible and, at a minimum, reporting responsibilities will be distinct and will need to be managed. The operational infrastructure of a Fund will need to take this into account. Notably, Fund investments should build on and not supplant opportunities for Medicaid to finance some aspects of SDOH initiatives on behalf of children.

  • Program accountability and evaluation. Ongoing quality improvement efforts, data tracking, reporting and evaluation all serve to promote accountability, ensure equity goals guide the work, improve program performance and encourage continued investment. Having clear expectations for stakeholders—for both sources of and recipients of funds—will be essential for growing the evidence base and awareness of a Children’s Health and Wellness Fund as an effective mechanism for helping children stay healthy and thrive.

Conclusion

Never has a focus on the health and well-being of our nation’s children been more important than in the wake of the COVID-19 pandemic and the health disparities it has laid bare. The short- and likely longer-term impacts of the economic and social effects of the pandemic are particularly harsh for children, and most notably for children of color. The pandemic, however, has unleashed new collaborations and opportunities for supporting children and their families; these efforts need to evolve into systemic changes in the way we prioritize and nurture the health and development of children, particularly children from marginalized communities. The development of a Children’s Health and Wellness Fund offers an important opportunity at a critical moment in time to bring together stakeholders—including states, cities, health systems and community residents—to shape, sustainably finance and deliver a whole child approach to supporting children and their families.

If you have any questions or would like more information, please contact Mandy Ferguson, Manager, Manatt Health, at mferguson@manatt.com.

1 Research indicates that up to 80% of an individual’s health outcomes can be attributed to nonmedical factors. S. Artiga and E. Hinton. Beyond Health Care: The Role of Social Determinants in Promoting Health and Health Equity. Kaiser Family Foundation. May 10, 2018. Available: https://www.kff.org/racial-equity-and-health-policy/issue-brief/beyond-health-care-the-role-of-social-determinants-in-promoting-health-and-health-equity/.

2 M. Marmot et al., “Closing the Gap in a Generation: Health Equity through Action on the Social Determinants of Health,” The Lancet 372, no. 9650 (Nov. 8, 2008):1661–1669.

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