A National Imperative: Joining Forces to Strengthen Human Services in America (Jan 2018)

utility structure can provide advantaged access to capital for spending on infrastructure and talented professionals.

There may also be situations where CBOs should proactively consider mergers as a way to take their missions forward. Mergers may be the correct response when the nature of funding has changed in a way that requires greater scale, efficiency, or back-office capability. For example, in localities where human services funding is moving toward managed care or value-based payments, there will be pressure toward consolidation. The need for programmatic scale and the increased requirements for information technology, risk-bearing capacity, and financing may require CBOs in these localities to merge. Smaller CBOs serving limited populations may join a larger organization to obtain access to up-to-date systems and better financing, rather than trying to “go it alone.” There is also pressure to consolidate when CBOs face competition from or need to engage deeply with significantly larger entities, including hospitals, managed care organizations, and insurance companies. These entities are more likely to engage with a small number of larger CBOs than with a large number of smaller ones. Of course, it is ultimately the CBO’s board that must decide whether a given merger or partnership makes sense in light of potential alternatives. But boards serious about their duties of care, loyalty, and obedience must be open to the possibility – and not solely as a last resort. Exploration, creation, and sustained implementation of this type of deeper partnership will not be easy; it will require time, attention, and most of all, funding. Government agencies and private funders , therefore, will need to commit financial resources to partnership development. This could be accomplished by making explicit grants and payments in support of partnership exploration or by allowing CBOs to direct some portion of their existing funding toward investment in the activities and capacities needed to realize successful partnerships. We also recommend that government agencies examine their existing organizational silos. In jurisdictions where multiple government agencies, or multiple departments within agencies, are responsible for delivering human services to common or overlapping populations, these agencies must work to share information and to coordinate their contracting and service delivery. They should consider reorganizing around populations and high priority, high impact outcomes, instead of around specific programs. With regards to human services CBOs, government agencies should recognize and invest in CBOs as strategic partners, rather than as transactional vendors. Many government agencies, when interacting with CBOs, first identify a specific service requirement (e.g., 100 beds of shelter capacity), then solicit bids from the CBO community to provide this capacity. They select from among those bids by placing a heavy emphasis on lowest possible cost. We recommend that agencies seek to engage with CBOs earlier and on higher-level issues, to develop a mindset in which CBOs are viewed as partners in long-term community growth and development and continuous quality improvement. Important aspects of a partnership approach may include:

• • Advisory Boards (with CBOmembership) for population needs analysis • • Collaboration on program, service, procurement, and contract design

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