The Emerging Role of Community-based Agencies in the Managed Care Environment

The term managed care or managed healthcare is used in the United States to describe a group of activities ostensibly intended to reduce the cost of providing for profit health care and providing health insurance while improving the quality of that care (“managed care techniques”).  It has become the essentially exclusive system of delivering and receiving American health care since its implementation in the early 1980s.  Over the past thirty years managed care has continued evolve.  According to the trade association America’s Health Insurance Plans, 90 percent of insured Americans are now enrolled in plans with some form of managed care.  While state government have mostly “carved out” vulnerable populations from managed care arrangements, 26 states have contracts with managed care organizations to manage long-term care services for the elderly and individuals with disabilities.

Today, as part of a national trend, this is changing.  States are slowly starting to move vulnerable populations such as children and adults with disabilities and individuals with mental health issues, into managed care systems. This far-reaching change has significant implications.  Managed Care companies are been reaching out to the traditional providers of care to these populations, creating partnerships that will, I believe change the provider landscape.

As the Fedcap Group is immersed in preparation for these changes, we are also advocating for the way that they unfold.   The populations that will be moved into managed care arrangement often face social barriers and have chronic, complex conditions. Effective care coordination is imperative to meet the needs of these individuals and requires strong relationships between medical providers, insurance companies, social service agencies, and individuals and families.

Further, we are interested in exploring the social determinants of health, which research suggests are the “secret sauce” of truly improving population health, patient experience, and the cost of care. These social determinants include such things as:

  • Availability of resources to meet daily needs (food, transportation, housing);
  • Access to affordable education;
  • Access to job training and employment opportunities;
  • Availability of community-based resources;
  • Social supports; and
  • Socioeconomic conditions (concentrated poverty and the stress that accompanies it).

Comprehensive solutions are needed as vulnerable populations shift  to managed care. With a person-centered focus, state-of-the-art technology, expertise in helping people access benefits, and data to quantify our intervention and prove our impact, we look forward to being part of that solution.

Organizational Risk Management

Last week, I examined essential inquiry around assessing Strategic Risk Management in a complex nonprofit. It’s equally important for senior leadership to assess and establish a protocol for managing day-to-day Organizational Risk Management. Successful organizational risk management requires its own set of analysis as described below.

1. Do we have an integrated, firm-wide, risk management process?

Effective risk management is achieved through comprehensive risk reporting, governance policies and limits, escalation procedures, action triggers, and dynamic and integrated firm-wide processes.  As a pre-requisite to all of these issues, nonprofits must possess an analytical system capable of properly identifying, measuring, and aggregating all risks across the enterprise.

Equally importantly, an appropriate, “risk mindset” must be adopted throughout the organization. The goal should be that every employee feels they are a risk manager and are responsible to manage the risks that occur on their jobs every day. Once this mindset is in place, risk exposures and the risk analysis of key business initiatives must be routinely and intentionally discussed. Senior Management must also ensure that relevant risk measures are among the key metrics monitored by program managers on a daily basis. Finally, senior management must ensure that risk issues are handled proactively, and communications across program units are open and effective. Red flags to be watched and immediately addressed include 1) excuses that specific risks do not lend themselves to quantitative measurement, 2) that certain risks are the “nature of the business” and therefore should not be monitored or managed, and 3) phrases like “don’t worry,” “this is a low probability event,” or “local managers have it all under control,” need to be stricken from the organization’s vocabulary.  Instituting a rigorous firm-wide risk process also ensures that directors do not start questioning senior managers about risks that the corporation has undertaken only after it is too late.

 

2. Are professionals at all levels empowered and expected to manage risk?

 For the risk management of a large, complex nonprofit to be effective, it must be built not only into every part of the decision-making process, but also every into control mechanism throughout the organization. Common risk management language must be established throughout the organization, along with clearly delegated responsibilities for managing risk at all levels. Finally, leadership and risk management structures must be correctly aligned with the not-for-profit’s business model, and the right balance established between competing priorities and constituencies.

 

3. Do we have an appropriate risk management culture?

There are specific signs that we are on the right track, and that risk management has become part and parcel of a nonprofit’s DNA.  First, leadership must assume the ultimate responsibility for risk oversight responsibility, clear measures of success, using well-understood metrics for risk appetite, and risk limits.

Risk training and awareness programs must also be in place throughout an organization, with senior line managers and risk professionals responsible for formal postmortems of major mistakes. Senior management ensure that management incentives encourage responsible and value-added risk taking, and emphasize the importance of embedded risk management processes in the organization’s decision-making and communications.

With such a risk culture in place, silos will be broken down, open communication will be encouraged, and risk successes will be publicized and imitated. And when this happens, employees will make better decisions, keep their not-for-profit out of harm’s way, and reduce potential legal liabilities and reputational risks.

What is your protocol for both strategic and organizational risk? As always, I welcome your comments.

Pathways Out of Poverty

The United States is considered one of the richest nations in the world, yet we rank below 16 developing countries in terms of poverty. Only four other countries rank below the U.S.

As of 2018, 42.6 million Americans were living in poverty. Of those, 13.4 million are children—nearly the total populations of New York City and Los Angeles combined.

The consequences for children born in and living in poverty do not disappear as they age. The impact of their poverty extends beyond their immediate family and seeps into every sector of the community, from education to service and product business to government and charitable entities.

Children who are poor are hungry. They have problems with memory and concentration. Their sleep patterns can be disrupted. Their brain development can be stalled or stagnated. They are more susceptible to illness. They are more prone to anxiety, depression, and withdrawal. They tend to behavioral issues, which may well have consequences in the classroom and in the community. As they grow up, these consequences take their toll on society as these children default to crime, substance use, or other mental illness based on inadequate means from birth.

At The Fedcap Group, we know that education and employment are the pathway out of poverty. Every one of the top-tier companies that are part of The Fedcap Group are building and delivering tactical, practical, and precise innovations to improve economic well-being.

  • We are creating aspirational environments within educational settings—encouraging children of all abilities to dream big dreams and then helping them succeed.
  • We are providing the tools, information and the supports so that youth transitioning from foster care can enter college and helping them graduate.
  • We are providing training and building networks of healthy support so that individuals in prison re-entering society have the skills and supports to succeed.
  • We are creating job opportunities in the community for those with intellectual and developmental disabilities.
  • We are assisting those with mental illness and substance use disorders in their recovery and participation in the workforce.
  • We are assisting individuals over age 55 to re-enter the workforce.

We are working hard to solve—not serve—the problem of poverty. 

Ultimately, the goal is to create a healthier society, where children and adults of all abilities thrive.  This is the work we do every day.

How might your business or social enterprise join our mission in creating a truly better world?

As always, I welcome your thoughts.

Creating a Sustainable Future: The Power of Impact Investing

Last Tuesday, The Fedcap Group convened our bi-annual Solution Series: Socially Responsible Investing: The Moral Case for Impact Investing.   Socially Responsible Investing (SRI), is an investment strategy which seeks to consider both financial return and social/environmental good to bring about a positive change. SRI has potential in mitigating the toughest issues challenging the world today, including climate change, access to health care, and poverty.

Today, more than one out of every four dollars under management in the United States is invested in socially responsible investments. The number in the U.S. alone amounts to $12 trillion dollars.

Our panelists last week included Christina L Alfandary, Managing Director of ESG (Environmental, Social, and Governance) and Sustainable Investments at GAMCO Investors, Inc.; Robert Brown, Senior Partner and Founder of Atlas Impact Partners; and Martin Whittaker, CEO of JUST Capital. While each of our guests had a different lens on the topic, they had in common the clear precept that socially responsible investing is good for business, must keep growing as a concept and as a reality, and must be a catalyzing mechanism for ensuring the future of our planet and our society.

As the Fedcap Group refines its work in the area of Economic Development, establishing Community Development Financial Institutions as vehicles for helping individuals with barriers establish their own small business and contribute to the economy of their community, the concept of SRI is of great interest.  There is tremendous potential for investors to partner with non profits like The Fedcap Group to impact the economic well-being of people in impoverished communities.

Our Solution Series is intended to tackle topics of importance to business in the 21st century, to generate discussions on issues that require thoughtful solutions.

If you would like to watch our Solution Series on Socially Responsible Investing, you can view it by clicking here.

 

Enjoy!