Not Only How Much But How: The Importance Of Diversifying Funding Streams In A Reimagined Public Health System

Area of Science:

• Public Health
• Health Administration
• Health Economics

Background:

• Revenue diversification is a potential strategy for transforming public health systems.
• Limited national data exist on revenue diversification trends in public health.
• Understanding these trends is vital for financial resilience and sustainability.

Purpose of the Study:

• To quantify and identify patterns in revenue diversification among local health departments.
• To examine changes in revenue portfolios before and during the COVID-19 pandemic.
• To assess the relationship between revenue diversification and financial performance.

Main Methods:

• Utilized data from the National Association of County and City Health Officials' National Profile of Local Health Departments study (2013, 2016, 2019, 2022).
• Calculated a yearly revenue diversification index for local health departments.
• Analyzed revenue portfolios, sources (local, state, federal, clinical), and per capita revenues.

Main Results:

• Revenue portfolios showed minimal change between 2016 and 2022.
• Well-diversified departments had balanced revenue sources and higher per capita revenues.
• Less-diversified departments, reliant on local funding, experienced lower revenues and limited growth during COVID-19.

Conclusions:

• Revenue diversification is an underexamined factor in public health system financial health.
• Lack of diversification may place public health organizations under financial strain.
• Policy and practice interventions are needed to support revenue diversification for enhanced financial resilience.