V-Cap-CCA Loan Coverage: Forbes, RWJF New Public Health

September 18, 2014

Forbes, Investment Yields Cost Savings, Healthcare For Vulnerable Seniors

An entirely new wave of health care reform is coming to America with financing from Vital Healthcare Capital, a nonprofit community development financial institution (CDFI). V-Cap, as Vital Healthcare Capital is known, just made its first social impact investment, $10 million dollars, into Commonwealth Care Alliance or CCA, which serves vulnerable populations, including frail seniors and adults with disabilities.


Many of the folks served by CCA are eligible for both Medicaid and Medicare but often fall between the cracks in the system if only because they lack the resources to take advantage of the healthcare available to them.


CCA reports that it has also proven the ability to reduce costs by helping patients to avoid unnecessary hospital stays and to live healthier lives. Those eligible for both Medicare and Medicaid represent just 15 percent of the Medicaid population, but use 40 percent of the resources. Managing their care therefore presents a huge fiscal as well as social opportunity… Read More

Robert Wood Johnson Foundation New Public Health, High-Quality Care in Low-Income Communities: Q&A with Steven Weingarten, Vital Healthcare Capital

NewPublicHealth recently spoke with Steven Weingarten, CEO of Vital Healthcare Capital, about the inaugural loan and the firm’s expansion plans going forward.


NPH: How did Vital Healthcare Capital get started and what are its overarching goals and investment criteria?


Steven Weingarten: Vital Healthcare Capital has been formed as a new non-profit financing organization to invest in quality health care and good health care jobs in low-income communities. The organization came about after a couple of years of research and development with funding from the Robert Wood Johnson Foundation, as well as from the Ford and Rockefeller Foundations and support from SEIU, the health care union. Healthcare reform is really part of a broader restructuring of health care that has enormous implications for low-income communities, and for the health care providers and plans that have been focused on these communities. Having financial capital to be able to transform health care to a better delivery model will be a critical challenge in upcoming years. So we are coming in to serve that need.


NPH: Tell me about the investment criteria. What do you look for when you are thinking about the investments?


Weingarten: We’re looking for three things. One is strong financial and management competencies, two is a health care impact—we’re looking for organizations that will improve health care outcomes and quality of care for local communities—and three is a jobs focus. We are particularly looking for organizations that are committed to enhancing the job quality of the frontline health care workers who often are critical to a better model of health care delivery.Health care transformation is an enormously complex road and we’re looking for organizations that have demonstrated that they have the managerial, financial and clinical competencies needed for a better integrated model of health care delivery. We were particularly excited to have CCA as our platform transaction—our first deal—because they have demonstrated over the years that they’re an outstanding organization with clinical depth and they are able to serve vulnerable populations with complex needs.


NPH: Why does CCA need a new source of funding?


Weingarten: CCA has been one of the pioneering organizations serving Medicare/Medicaid dually-eligible individuals. CCA was one of the first demonstration plans about 10 years ago, in 2004, in Massachusetts that first took the Medicare/Medicaid funding streams and put them together so that one organization could take the full payment stream and integrate the whole continuum of care. CCA has been growing this model of care serving frail elders in Massachusetts and succeeding in both showing positive health outcomes and cost effectiveness, and as a result has been able to fund their own growth incrementally. The opportunity they have now is to dramatically scale the model and so there’s really an exponential growth opportunity. To achieve that they needed more than their own financial resources. The proceeds of the loan will provide for a very specific need—the financial reserves that CCA is required to hold as a regulated plan in Massachusetts. The loan frees up other revenue to be able to provide services and infrastructure that’s needed to build and grow the model—such as improving information technology systems, scaling up clinical capacity and increasing the workforce that’s needed to be able to serve a much larger population… Read More