Profile: Episcopal Health Foundation

October 16, 2018

Key Statistics

Founding Date: 2013
Location: Houston
Assets (12/31/2017): $1.3 billion
Total Grantmaking (2017): $33.5 million
Number of staff: 28

Background

“Rooted in faith and active in hope,” the Episcopal Health Foundation (EHF) believes that all people are worthy of the opportunity to live healthy lives. EHF pursues a holistic vision of health rooted in the community and it aims to transform people, institutions, and places to create healthy communities. The Foundation was founded in 2013 as a result of the transfer of St. Luke’s Episcopal Health System by the Episcopal Diocese of Texas. The Foundation focuses not only on ensuring access to high quality and affordable medical care by the 11 million people within the 57 counties of the diocese, but digs deep into systemic issues and works to solve problems at the core level.

Core Framework

The Episcopal Health Foundation is a public charity and supporting organization of the Episcopal Diocese of Texas.  Its social compact is defined, in part, by how it was formed.  The Diocese transferred the sole membership in the entity that owned the hospital system to Catholic Health Initiatives, in exchange for Catholic Health Initiatives making a donation to the newly created entity of EHF. As a condition of approving the transfer of this nonprofit, the state attorney general required that EHF spend 85% of the donation on health in the 57 counties of the diocese.  In addition, the social compact is influenced by a deep sense of accountability to the people living in the diocese. The Foundation seeks to serve the health needs of all the people in the diocese. This commitment manifests itself in responsive grantmaking that is informed by the communities. For the most part, the Foundation developed operating capabilities that can be described as centralized, disciplined, very deep, and highly networked.

Charter

“It’s not fair that some people don’t have the same opportunities to live a healthy life that others have, and it’s dependent upon when and where they’re born and to whom they’re born. If we can do things to level that playing field for those who are disadvantaged, to equalize the opportunity to live a healthy, productive life, that’s pretty good work.”

– Elena Marks, President and Chief Executive Officer

History and Founding

In 1954, the Diocese founded St. Luke’s Episcopal Hospital, which provided medical services in Houston. The hospital grew in size and prestige over many years; however, as changes in the healthcare delivery system evolved over time, it became a challenge for this relatively small system to remain competitive and relevant.  Ultimately, it was determined that a billion-dollar investment was needed to maintain the hospital in its current state and that even then the question remained regarding its viability as a stand-alone system. In fact, all of the prospective purchasers were larger systems that could achieve significant economies of scale that St. Luke’s could not have achieved on its own.  Instead of making that investment, Bishop Andrew Doyle recognized that a more “upstream” approach could be taken to attack the problems that lead to poor health.  Given that positioning as well as that St. Luke’s only operated in three of the 57 counties, the hospital was transferred to another hospital, and the proceeds of that transfer were placed in the newly created Episcopal Health Foundation, which takes more of an upstream approach.

The vision of the Foundation today is a “diocese in which the people, parishes, institutions, and communities are all connected in service of transformation to healthy communities for all.”

 The Role of the Church

The bishop is the chair of the board, and he appoints other board members who are approved by the diocesan governing body. The church does not oversee day-to-day decisions; these decisions are made by staff, led by a president and CEO with a long history in public health in Texas. To ensure that Episcopalian values are reflected in the Foundation’s work, the president and CEO works collaboratively with the bishop, consistent with a stewarded charter style.

While staff does not need to check with the leadership on every decision, the Foundation leadership is committed to transparency and to keeping the bishop apprised of important developments. The president and CEO ensures that the bishop weighs in on issues related to how the Foundation is positioned to the public. For example, staff seeks the bishop’s approval on key communications (such as the website) to ensure the church is accurately reflected.

Articulation of the Foundation’s Values and Approach

The Foundation’s president and CEO is responsible for articulating the values and vision of the Foundation down to program and operational staff. This is done both formally in strategic planning processes that have yielded specific sets of goals, values, and strategies, and more informally through a set of unwritten rules of practice.

The Foundation’s values are as follows, as expressed on their website:

  • Informed Action.Rigorous research is the foundation for actions and initiatives that have the potential to transform human lives and organizations.
  • The most effective use of financial resources is often discovered in ministries that go beyond the limits of individuals or individual congregations. Broad-based communities galvanized around responses to particular human needs have a powerful potential to effect real and lasting change.
  • The old adage is true: It is good to give a hungry person a fish; it is empowering to teach the same person to fish. Loving and compassionate people often need training to be effective change agents. Leadership development and training are central to empowerment.
  • Good stewardship requires careful oversight and development of the abundance that God provides.
  • All actions and decisions are open to the light of public scrutiny. Secrecy and confidentiality are not the same thing.
  • The results of decisions and actions of EHF are audited and measured against reasonable benchmarks. Mistakes are made. When mistakes are treated with openness and honesty, lessons are learned. Public accounting and reporting are made on a regular basis.
  • Transformation of human lives and organizations. The best good is good that lasts by effecting transformational changes in root causes.
  • Compassion for the poor and powerless.

As EHF is so young, it does not have a tradition of operating that is widely known and understood, nor has there been significant exploration of the how the Foundation’s charter works in the face of major decisions or possible changes. Instead, EHF staff is learning how to navigate the complicated relationships between grantees, staff members, the board, leadership, and the church in real time. Staff is learning what role they play in the community and in the organization. Leadership has been learning how the Foundation should and does exist in relation to the church structure, the broader community in Houston, and the public sector.

Social Compact

“I think if we can influence others to prioritize what we prioritize and think about the work the way we think about it, that’s our best leverage, because our money is finite compared to all the other resources that could be brought to bear on the same problems.”

– Elena Marks

While the Foundation feels deep accountability to the diocese, it is also clear that it is not simply a replacement or backstop for services traditionally delivered by government. The thinking behind this is revealed in a 2016 blog post entitled “Philanthropy Isn’t the Answer to Bad Government,” in which Elena Marks and co-author Houston Endowment’s president and CEO Ann Stern challenge a common misconception that funds from foundations should be used to backfill any reduction of government support for nonprofit organizations. Instead, Stern and Marks state that philanthropy and government can complement each other, leveraging the strengths of both. They assert that, “philanthropy is nimble and interested in experimentation, whereas government tends to move incrementally and may be risk-averse, especially when there is uncertainty about budget implications.”  They further flesh out this idea arguing that philanthropy is wise to support pilot programs and start-up costs and enable government to experiment with minimal risk.

As an expression of its commitment to problem solving, EHF prides itself on its willingness to take risks. The Foundation has taken what it calls an “evidence-informed” approach to philanthropy rather than an “evidence-based” approach, reflecting its position that every program worth funding will have an element of risk. The Foundation believes that funding the tried-and-true will not move the community forward.

An example of this approach is the Foundation’s new programming aimed at creating community-centered health homes. EHF is supporting thirteen clinics to try this approach, and has allocated $10 million to support grantmaking, coaching, and technical assistance. While the programmatic decision is well informed with solid research behind it, it is not a sure bet. But the program holds long-term promise to improve clinic operations and serve as a model for others.

As a relatively new foundation, EHF’s practices are continually evolving as its leaders reflect on how best to fulfill their mission. The communications approach is quickly moving from simply letting its constituents know about grants to becoming a tool for advocacy. In addition, the Foundation is using its communications function to educate the community on the importance of upstream philanthropy focused on the causes of poor health and health disparities. The Foundation is keen on showing that there are innovative ways to solve problems. By highlighting successes, EHF hopes to enroll policy-makers and other decision-makers to replicate its approach. And in the community, having a robust communications approach serves to educate parishioners (who might have thought that the sale of the hospital would be a windfall for the churches) that there are more effective, long-term approaches to improving health.

Operating Capabilities

The Foundation’s operating capabilities are balanced in many areas, and EHF goes deep into some program approaches, while also broadly impacting many different health challenges.

“We’re a learning organization. We’re a risk-taking organization, we’re entrepreneurial.”

– Jo Carcedo, Vice President for Grants

For example, EHF seeks to strike a balance between centralized and decentralized decision-making, falling in the middle of this spectrum. As with most foundations, the biggest decisions are made at the CEO or board level; however, staff input informs these decisions. A relatively flat organization, EHF seeks to be a consensus-driven body, though not a pure democracy. Immediately below the CEO is the leadership team, which includes the vice presidents, the chief administrative officer, and the director of communications. The next level down includes the directors of divisions, and below this level, most of the remaining staff are on the same (or similar) level. Staff below the vice president-level are learning to understand what kind of decision-making authority they have, which tends to be more around their day-to-day activities. To help drive consensus, EHF has instituted a bi-monthly all-hands meeting where every staff member has the opportunity to make suggestions and where the president and CEO can share her thinking. Thus, decisions come from the top, but input is encouraged.

With respect to a build versus buy approach to resourcing, the Foundation at times employs outside consultants to develop specific content areas, and to help when the Foundation has the content area expertise but not the capacity to carry out the desired scope of activities. For example, the Foundation enlisted the help of consultants to build its child development strategic goal, when it lacked both internal capacity and expertise to do so. The Foundation also brought in outside help to examine operations when it sought to become better known for its work, and to help develop its new strategic plan.

Since its start, EHF has worked toward a disciplined approach that emphasizes systems change over creativity in implementing its work. This has been challenging at times as community members (and some board and staff members) have struggled to get behind an approach that does not show immediate impact. Leadership has reinforced to program staff the need to be on board with the EHF approach, and that although they will continue to support direct services, they are increasingly trying to find upstream opportunities and to get those indirect service providers to look at systems approaches.

In alignment with this emphasis on a systems change orientation, EHF is moving toward a more proactive grantmaking approach and away from being strictly responsive. In the Foundation’s first few years, staff looked at whatever came through the door, but 2017 is serving as a transition year and, starting in 2018, EHF will seek move to an outcomes-focused grantmaking system. One area under development is rural health, and the Foundation is working with numerous rural health organizations to develop an approach.

“If you want strategic philanthropy, you have to ask a strategic question.”

– Jo Carcedo

In terms of program focus, the Foundation aims to balance an approach that is both broad and deep. On one hand, the approach is broad in that it seeks to improve health outcomes throughout the 57 counties of the diocese; but there are also areas of focus such as rural health, child development, and mental health. Similarly, while there is openness to new areas, there are also staff limitations. The Foundation has been open to prioritizing different types of health interventions, but it has been strongly committed to championing an upstream, prevention-based approach based on the goal of preventing the need for medical help in the first place. Given this priority, bandwidth can limit their approach.

Finally, from the Foundation’s start, leadership has prioritized networks and relationships over functioning as an independent actor. Early in her tenure, the president and CEO called together the significant philanthropic organizations in Harris County that supported health. At that meeting, the group discussed opportunities to work together. There were 10 philanthropies as a part of the initial group, five of which remained as the core group that looks for opportunities to mutually fund initiatives. This group is also sharing information about potential grantees and approaches. In addition, EHF uses its networks to encourage national funders to support organizations and initiatives in Texas. Texas does not appear on the radar screen for many national foundations, and EHF is working to change this. EHF also works with national foundations through co-funding. For example, when the David and Lucile Packard Foundation launched a national initiative which was not able to fund Texas organizations, and EHF came in and provided funding to the Texas organizations that scored high but did not secure funding in that initiative.

Theory of the Foundation in Action – Congregational Engagement

EHF has worked hard to cultivate its national reputation as a significant and impactful health philanthropy staffed with experts in health policy, healthcare delivery and public health, and has numerous successful programs underpinning that reputation.

One of EHF’s more unique—though significantly smaller—programs is its Congregational Engagement program, which trains churches how to do community-engaged work as a means of changing the health world.  EHF partners with more than 150 Episcopal congregations in the diocese, each of which have a long history of commitment to creating healthy communities, to educate them on organizing and focusing their efforts to have the greatest community impact. EHF’s work with congregations translates its core accountability and commitment to the diocese into action by providing learning and training for congregations. EHF helps congregations establish, improve and expand community outreach efforts.  EHF views its job as teaching the churches to do this work, and accomplish that objective through direct consulting, hiring consultants to help them, paying for various kinds of trainings for them, and on occasion providing very small amounts of cash to support this work.

This program was created in partnership with the bishop, reflecting his desire for the church to be outwardly focused on health, and is led by the congregational engagement officer, whose initial goal was to engage the institutions and the people of the diocese to ensure an understanding that the Foundation was an asset to transform community health. This congregational engagement officer learned that much of the philanthropic work done by churches focuses on charity instead of change, with efforts such as food pantries, collecting coats, and providing other emergency services. The goal of the Foundation is to move the churches from charity to community health transformation, and to help the churches create connections with those whom they helped, instead of just making charitable transactions.

The approach that the Foundation has taken with the congregations has been, so far, opportunistic and responsive. The Foundation prioritizes creating incentives and helping the congregations get excited about doing work that is different, new, and more focused on long-term change. While congregations are not required by the diocese to engage in this effort, the Foundation reports a great deal of positive energy around the work and goodwill toward the diocese.

An early project of the congregational engagement initiative was to survey the congregations to learn about their greatest concerns. Mental health emerged as the top priority, prompting the Foundation to hire a consultant to draft a strategy around this issue and to provide mental health first-aid training for congregations. The Foundation also contracted with a nonprofit organization to help Spanish-speakers with issues around voting during election season, and paired church members as mentors with young people in the criminal justice system. Finally, the Foundation provided small amounts of money (from $5,000 to $10,000) for strategic planning consulting, new outreach training or similar activities for specific congregations.

Having faced only a few challenges—such as rural congregation engagement and the need for congregations to devise self-sustaining programs—the Congregational Engagement program has already proven successful in increasing interactions between the Foundation and the churches it serves, and has resulted in improved energy, and increased excitement, and several new projects. It is also creating a model for this type of work, as there is little to no precedent for a foundation of this size engaging with churches in such a close, responsive, and collaborative manner.

“This may be one of the most experimental parts of the foundation.”

– Lisa Madry, Congregational Engagement Officer