Leadership Dialogue

00:00:00:27 - 00:00:31:21
Tom Haederle
Improving and investing in the health and wellbeing of communities is a core mission of hospitals. Whether it's working with partners to support new programs in housing, transportation, daycare or anything else, it all comes down to meeting the needs of people. It's been said before, but bears repeating: Hospitals and health systems are truly anchors of their communities.

00:00:31:24 - 00:01:04:23
Tom Haederle
Welcome to Advancing Health, a podcast from the American Hospital Association. I'm Tom Haederle with AHA Communications. In this month's Leadership Dialog Series podcast, Dr. Joanne Conroy, CEO and president of Dartmouth Health in rural New Hampshire and 2024 board chair of the American Hospital Association, is speaking with David Zuckerman, founder and president of the Health Care Anchor Network. David is a national thought leader on the role of health systems as anchor organizations in building healthier communities through impact investing and inclusive economic development.

00:01:04:25 - 00:01:13:03
Tom Haederle
As he says, "We talk about big ideas in this country. I needed to see a path to bringing them to reality." Let's join them.

00:01:13:06 - 00:01:44:02
Joanne Conroy, M.D.
Thank you for joining us today for another Leadership Dialogue discussion. I'm Joann Conroy, CEO and president of Dartmouth Health and the current chair of the American Hospital Association Board of Trustees. I'm really looking forward to our conversation today as we speak with a national expert, David Zuckerman, about his insights and perspectives around a core mission in health care, improving and investing in the health and well-being of our communities.

00:01:44:04 - 00:02:17:06
Joanne Conroy, M.D.
There is a broad lack of understanding about how hospitals and health systems provide benefits to their communities outside the world class care we deliver within our walls. The truth is, there's a lot of great work being done in the field outside the bricks and mortar. We partner with, and we invest in communities, in the businesses and the communities in the nonprofits that are our partners and others to make sure that those we serve have the best chance to thrive and live healthy lives.

00:02:17:09 - 00:02:44:13
Joanne Conroy, M.D.
Our goal is not only to ensure our community members have access to needed medical services, but they also benefit from our investments. We've taken this mission to heart with the launch of the 2022 Center for Rural Health Equity up here at Dartmouth Health, whose mission is to give voice to the communities about what they need most to thrive and then to invest in those mutually beneficial ideas.

00:02:44:20 - 00:03:17:02
Joanne Conroy, M.D.
Health does begin by investing in the community and critical resources such as housing, transportation, daycare and most importantly, in the people in our communities. At Dartmouth Health, like other organizations, we're deeply committed to meeting the unique needs of our patients and our community, and we're doing so through pursuit of anchor designation status. Now I get to introduce David Zuckerman, who's president and founder of the Health Care Anchor Network, to discuss this concept further.

00:03:17:07 - 00:03:46:02
Joanne Conroy, M.D.
David is a national thought leader and is incredibly passionate about the role of health systems as anchor institutions and our important work in building community wealth and inclusive economic development. So, David, you work with health systems across the country that have adopted the anchor mission framework, and the numbers are growing of hospitals and health systems that are committed to helping you with this work.

00:03:46:05 - 00:03:49:09
Joanne Conroy, M.D.
How did you get started on this path?

00:03:49:12 - 00:04:14:08
David Zuckerman
I've been on this path for a bit more than a decade, and it really started with looking at what are some of the big ideas out there that are rooted in community that really could get at addressing the deep racial and economic inequities within our society. We often talk about really big ideas in this country. And for me, I needed to see a path to bringing them to reality.

00:04:14:11 - 00:04:57:17
David Zuckerman
And what really attracts me to this idea of the anchor mission and the role that anchor institutions can play in their communities, and in particular, the role health systems can play as anchor institutions is that it's a deeply practical framework with transformative possibilities. And for the last decade plus, I've been researching what are some of these examples and helping other health systems not only understand what are some of the best practices in how they can leverage their hiring practices or their purchasing or their investment, but how to make it a holistic strategy that really can allow for the full expression of this idea become a reality within communities across the country.

00:04:57:18 - 00:05:27:17
David Zuckerman
And so I've been researching it, but I also think I'm a passionate advocate for what I think is the transformative potential of this idea. Around 2017 had the opportunity to bring health systems together to say, Can we do more than just look at examples from across the country? Is there an opportunity to learn together, identify gaps so we can scale solutions to? And that became the healthcare anchor network, which had 11 co-founding systems.

00:05:27:19 - 00:05:55:08
David Zuckerman
Dartmouth Hitchcock at the time, a couple months later became one of our early members of the Health Care Anchor Network. And we've grown today to to 75 members from across the country, representing just under 40% of of health care and our independent 501-C3. So am excited about that journey and really think there's so much more we can do and we're just really in the early days of what this idea could look like.

00:05:55:10 - 00:06:13:07
Joanne Conroy, M.D.
So I've started a few not-for-profits and it is hard work. So what were you doing when this became a glimmer in your eye to actually bring it to fruition? So where did you start thinking about launching something like this?

00:06:13:09 - 00:06:36:09
David Zuckerman
Yeah, so fortunately I didn't have to do it completely from scratch. I started as a employee at the Democracy Collaborative, which was a think and do tank, which talked about big ideas for how to make more equitable the political economy of the US and part of that did the do part was what are the role of large institutions and communities.

00:06:36:09 - 00:07:02:20
David Zuckerman
And so really within that organization, I had the chance to begin to do the research, begin to build the relationships. I was really asked to build the strategy for how to engage health care. And then fortunately, we had some champions within health care systems across the country, within Kaiser Permanente, Trinity Health, CommonSpirit Health that saw the potential of this idea and said, okay, we need to form a national conversation.

00:07:02:20 - 00:07:25:05
David Zuckerman
We need the Democracy Collaborative to be the backbone. And then after the Health Care Anchor Network was formed, really with the support and collaboration of those those health systems, we then had a very quick timetable during the middle of the pandemic to spin the organization out as its own standalone nonprofit. And so that happened over the course of 2021

00:07:25:05 - 00:07:52:24
David Zuckerman
and since January 2022, we've been fully independent. So excited to now be able to fully focus on how do we scale this idea within health care and also encourage health care to think about its role within its communities to bring along other anchors, to create local collaboratives that can accomplish this work in place and really ensure that, you know, of course, no one institution can solve issues of poverty and racial inequities on their own.

00:07:52:24 - 00:08:17:21
David Zuckerman
It takes all of us, and we believe that the Health Care Anchor Network that health systems need to be the tip of that spear, but they need to be working with higher ed. They need to be working with public institutions, community foundations, other institutions to share that principles of being an economic engine or having significant resources they can leverage as well as a nonprofit or public mission.

00:08:17:21 - 00:08:26:14
David Zuckerman
And I believe the combination of those two just allows an organization to think long term in a way that it might not be able to otherwise.

00:08:26:16 - 00:08:39:14
Joanne Conroy, M.D.
There have been some amazing things that your members have done. Talk about a couple of them that have really impressed you in terms of the impact that they've had on the community.

00:08:39:17 - 00:09:05:14
David Zuckerman
Yeah. So where to start, right? I mean, if I don't name some, I might get in trouble. Name a few that really come to mind as I think powerful examples of what this work could look like. One is work that was done in Cleveland, Ohio, over the last decade, in which Cleveland Clinic University hospitals, again working with Cleveland Foundation, other partners said, you know, we have supply chain needs, we have a business problem.

00:09:05:16 - 00:09:36:04
David Zuckerman
And we also can use that as an opportunity to think about incredible social impact we can have at the same time. And coming out of that process was a recognition that commercial laundry, a critical supply chain for every health system in the country, is a very problematic industry. There are very few suppliers. The quality is suspect often. And could you create a community rooted solution that also provided jobs for those that were justice involved, individuals who have a difficult time getting jobs elsewhere,

00:09:36:06 - 00:09:57:23
David Zuckerman
right? But they need a second chance. Can you ensure that those jobs were living wage and had health insurance again, bringing people into the commercial payer system? Can you actually have a profit sharing strategy? So they're not just living paycheck to paycheck, but have an opportunity to build wealth? And can this commercial scale laundry also have sustainability principles?

00:09:57:23 - 00:10:17:27
David Zuckerman
Because that was an important priority of Cleveland Clinic University hospitals to reduce their climate footprint. And so coming out of that process was an effort to create what's now known as the Evergreen Cooperatives, starting with a commercial scale entree that employs more than 200 people, has all of those benefits that I listed. And I think that's the principle of

00:10:17:27 - 00:10:40:28
David Zuckerman
what can happen when organizations collaborate and it's rooted around a business need that needs to be solved. But there are creative people thinking about what is the additional social impact that we can have at this moment in time. Right? They could have just gone with the traditional commercial laundry. Instead it's an impact for community transformation. So that and now other organizations, other are looking at adopting that.

00:10:41:01 - 00:11:06:03
David Zuckerman
Just the other day there was an article in the Chicago Press how Rush is adapting that model for their community. Also looking at commercial scale laundry, but putting it within a larger incubator that's going to have four companies that are minority-owned and have other types of businesses that will serve the West Side of Chicago and hopefully be a catalyst for transformation for that community.

00:11:06:03 - 00:11:11:15
David Zuckerman
So that's one I think really powerful example on the supply chain side.

00:11:11:18 - 00:11:30:19
Joanne Conroy, M.D.
So talk a little bit about, but on the food insecurity side, because I think there are a number of hospitals and health systems that have identified that as a community need and somehow marry that with their either growth strategy or their clinical strategy.

00:11:30:21 - 00:12:06:17
David Zuckerman
Yeah. So I think core to the anchor strategy is where are there business pain points or that intersect with community priorities and what is an overlapping strategy that can address both? And so on the food insecurity side, where we've seen that most show up is around the opportunity to leverage investment, impact investment. And that's I know something that Dartmouth Health has really been a leader on around impact investment in affordable housing.

00:12:06:19 - 00:12:39:25
David Zuckerman
But on the food security side, we've seen a number of health systems see this as a way to get more dollars to support grocery stores coming into communities. Boston Medical Center has provide a low interest patient loan to minority-owned grocery store operator to come into a community that didn't have that food access. Hawaii Pacific Health has provided capital to support the growth of local food entrepreneurs.

00:12:39:27 - 00:13:10:20
David Zuckerman
And so in this way, these aren't these are charitable donations. These are investments to grow the local food ecosystem and also support communities that have historically lacked resources. There have been some organizations that have thought more upstream about their grant-making. And my perspective is that's really important. And there's never enough grant dollars to go around, which is why thinking about impact investing and leveraging the balance sheet in other ways is really an important strategy that organizations should consider.

00:13:10:20 - 00:13:39:18
David Zuckerman
But you have organizations like Promedica that saw this as an opportunity to attract a large philanthropic supporter to help create a grocery store that actually Promedica still owns. And I think that's a powerful example of, again, how do we think creatively about how do we address these gaps with sustainable solutions right? The goal there is for that grocery store to break even, make a small profit.

00:13:39:18 - 00:14:09:03
David Zuckerman
It's a very tough business, actually used to serve on the board of a food co-op here in Takoma Park, Maryland. It's a very tough business, very small margins. But at the same time, it's an important amenity that every community needs if we're going to address issues of food insecurity. University Hospitals in Cleveland, as part of our buildout of one of their facilities, that they went through a very intentional process to get community input on, make sure it really met community needs from a clinical perspective.

00:14:09:06 - 00:14:37:27
David Zuckerman
Also heard that it would be really important that it had a grocery store sited nearby. And so as part of that project, they recruited a grocery vendor that was locally owned to open a grocery store, basically adjacent. So I think there's a lot of different ways health systems can do this beyond just writing a check for a food pharmacy or beyond just providing a subsidy that really looks at sustainable interventions over the long term in their communities.

00:14:37:29 - 00:15:02:16
Joanne Conroy, M.D.
Yeah, I remember hearing about Promedica's grocery store that was in the first floor of the new building that they built, and they purposefully put their corporate offices downtown in one of the most economically disadvantaged areas, which has a huge impact in terms of the availability of jobs, but also making that space really an important community resource.

00:15:02:19 - 00:15:46:15
Joanne Conroy, M.D.
So why don't you talk a little bit about impact investing, because I think that's something that is a kind of a unique conversation that the Health Anchor Network has really encouraged, number one. And number two, talk a little bit about we have so much backlash on really ethics-based investing. I see coming down the pike as everything kind of comes under scrutiny. And it feels like the way you're approaching this is much more sustainable than other organizations, investment firms approaches to their investing because yours is an investment that actually creates wealth for the community.

00:15:46:17 - 00:16:10:08
David Zuckerman
And I think the power of it is that it's so linked to the mandate and the community health needs assessment. What we're trying to solve with these investments is showing up in every organizations community health needs assessment, whether it's lack of access to affordable housing, economic opportunity, food insecurity. And so I think health care has a really strong rationale for why to make targeted investments.

00:16:10:10 - 00:16:36:00
David Zuckerman
It also aligns and connects the dots between community health, diversity, equity and inclusion, sustainability, civic responsibility, social impact. So that's why I think the power of the anchor mission is not necessarily coming to replace the strategic priorities the organization has, but really to connect the dots more intentionally across the different areas that organizations are putting resources, but they're not necessarily always aligning them.

00:16:36:02 - 00:17:00:11
David Zuckerman
They're often very siloed. And I think the opportunity here is how to especially again, to your point, very tight margins in health care. So we can't afford to be using resources inefficiently. We can't afford to be siloed when we should be aligned. And that's what I think the anchor mission allows. So I think with impact investment, when I think of it first and foremost, it's a place-based strategy. And it's focused on the places that health care knows

00:17:00:11 - 00:17:21:14
David Zuckerman
there are health disparities. And from there is then thinking about, okay, how do we leverage the balance sheet? So, you as a health care organization have to hold reserves. There are you know, it's important to your bond rating. It's important to ensure when there's a downturn that you can plug any gaps in your fiscal budget. It has to happen.

00:17:21:21 - 00:17:57:02
David Zuckerman
At the same time, those dollars can be serving double duty in terms of also being put to work in your community. So they still give you a financial return, but also have a social impact. And the way I think about it is: we are asking our health systems to consider allocating 1% out their reserves. And that would be, from my perspective, puts you within the leaders across the country and the amount of financial return you're giving up on 1% is really a rounding error over the long term for an organization, but it's a game changer for a community.

00:17:57:04 - 00:18:26:12
David Zuckerman
And I look at the example of what you guys have done in New Hampshire with the New Hampshire Community Loan Fund, Right? It's a very reputable organization. You're not going to lose your money and you're really providing critical dollars that are going to touch every part of the communities you serve with health care. And that, I think, is and is a low hanging fruit type strategy that many organizations can start with, which is, okay, here's a very reputable community development financial institution, other type of loan fund.

00:18:26:18 - 00:18:45:29
David Zuckerman
We know we're going to get our money back. We know we're going to get a financial return and we know we're going to get reportable metrics as that we helped create this many affordable housing units in our community. We help finance this grocery store there. We helped allow this child care center to open over there, this community center to open over here.

00:18:46:04 - 00:19:16:02
David Zuckerman
So we know that. But then the next level is while you're thinking about those early stage investments, are what are the type of collaborative investments that might be a little bit more difficult to pull off, but incredibly catalytic. And I think about that as being the Upper Valley Community Loan Fund that you've all supported equally, being an example of how to do this in a rural community, bringing together many mission focused individuals that all had very critical business needs, right?

00:19:16:02 - 00:19:55:00
David Zuckerman
They needed to have housing not just for community members, but for their customer base, in your case, your patients and also their employees. So I think health care in particular, very focused on people, patients, community and investment is an area especially you think about affordable housing that's really providing a solution to all three. And so I think it's it's an area that health systems, as they look at the dollars they have, this is one in which there is a lot of gain that can be created in a short period of time versus some of the other strategies that we talked about.

00:19:55:03 - 00:20:19:17
Joanne Conroy, M.D.
Yeah, you're right. That actually was not a difficult lift, but it did take us about five years to work with the CEO Council for Vital Communities, which is our group of employers across the Upper Valley, to get them to a place where they said, yes, we're all going to commit and everybody didn't commit equal amounts because some of us are bigger than other organizations.

00:20:19:17 - 00:20:49:16
Joanne Conroy, M.D.
But everybody did commit something. And then using a few sharp elbows to bring some people into the fold, that should have been in there. And they're happy they joined. Now, once you get it going, it is incredibly successful. And we've had a number of developers that will commit to building low income housing, and low income is not as low as it was years ago, but housing at a certain percentage of our employees can actually afford.

00:20:49:21 - 00:21:02:12
Joanne Conroy, M.D.
So I think the next step that we're into, though, is single family homes. And how do you create homeownership? Because that's actually when you start to see the multipliers, I believe.

00:21:02:14 - 00:21:23:12
David Zuckerman
And I think to your point that took five years. And that's one of the more complicated investment strategies that are out there, right? The effort to make a loan with the New Hampshire County Loan fund was, you know, yes, there's always that conversation, getting everyone comfortable with the idea. But once you get the organizational buy-in, it can move very quickly and you can deploy those dollars.

00:21:23:12 - 00:21:45:10
David Zuckerman
And I think that's that's kind of the spectrum of way organizations can consider getting started with the impact investment. I think just two things that I would add to that is we actually just had an article in The New York Times just the other day looking at the landscape of organizations supporting housing and the Health Care Anchor Network.

00:21:45:10 - 00:22:07:14
David Zuckerman
Most of the health systems in the nation that are doing this impact investing strategy participate in Health Care Anchor network. It's still a relatively small number. It's about 20 that have some type of active impact investing strategy. And those 20 have deployed over the last couple of years about $600 million to these impact investments, of which about 450 million is for housing.

00:22:07:16 - 00:22:24:00
David Zuckerman
That sounds like a lot of money, but it's actually really a small percentage of the overall investable assets. And institutions have, which for me means that that opportunity is so much greater than what's already been done. And that's what I get excited about.

00:22:24:02 - 00:23:00:10
Joanne Conroy, M.D.
So for our final question, I'm asking you to share your insights on collaboration. And you articulated this before that, you know, no health system, no matter how well funded or well organized we are, we can't solve social problems alone. It really takes a broad network of community partners in order to do that. So what do you think is the most effective way for organizations to identify other interested organizations to partner, collaborate with, with community partners in this work?

00:23:00:12 - 00:23:27:17
David Zuckerman
I think it's a combination of getting out there and talking to them and getting out there and listening to them. We are working with an organization called Center for Community Investment, and it's a cohort within the Health Care Anchor Network. And so we've taken four of our health systems that are at that point of where they've gotten buy-in and they've gotten allocation and they want to build the pipeline of projects and we're taking them through an 18 month learning process on how to do that.

00:23:27:19 - 00:23:55:19
David Zuckerman
And key to that is getting out there and building those community relationships. And we help organizations understand who they could meet with, whether that's just getting a list of community development, financial institutions in their community, whether that's time to meet with community development corporations, other nonprofits that have been focused on community development and transformation. And I think what's important, at least with this tool that we're talking about today, is making clear that it's not a grant.

00:23:55:22 - 00:24:04:10
David Zuckerman
These are dollars your institution expects to get back and you're looking for partners that will help you find projects that are investable.

00:24:04:13 - 00:24:24:04
Joanne Conroy, M.D.
It was really great, David, to hear your insights and the work you're doing in our field and on behalf of the American Hospital Association and Dartmouth Health and all of us in health care, I want to thank you for joining me today for this discussion and sharing your valuable insights. And my thanks to all of you for finding time to listen.

00:24:24:07 - 00:24:28:18
Joanne Conroy, M.D.
I'll be back next month for another Leadership Dialogue. Thank you.

00:24:28:20 - 00:24:37:00
Tom Haederle
Thanks for listening to Advancing Health. Please subscribe and rate us five stars on Apple Podcasts, Spotify or wherever you get your podcasts.