Impact Investing: Shaping A Sustainable Future For Older Adults
Sarita A. Mohanty, MD, MPH, MBA, serves as the President and Chief Executive Officer of The SCAN Foundation.
According to the Administration for Community Living (ACL), a division of the U.S. Department of Health and Human Services, the older adult population in the U.S. is projected to reach about 80 million by 2040, which is more than twice as many as in 2000. Despite this projected demographic shift, I’ve noticed the marketplace is ill-equipped to serve this population.
The challenge today is not only how to meet this demand but also how to do it in ways that address the real needs of older adults and empower them to lead healthier, happier and more fulfilling lives. This growth demands innovative care solutions beyond status quo investments in senior living.
The Business Case For Aging Innovation
Aging is not just a social issue but an economic one. Forward-thinking investors and business leaders have a crucial role to play in this.
In the U.S., national health expenditures reached $4.9 trillion in 2023, yet organizations often failed to deliver equitable and cost-effective care. The current system is failing to meet the moment, particularly as older adults face mounting financial and social challenges that directly impact their health.
For example, during my clinical work, I encountered a lower-income older adult who came to urgent care for poorly controlled diabetes. However, his biggest concerns weren’t just medical—they were financial. He was afraid of how much the visit would cost and unsure if he could afford rent next month. His health was being shaped more by economic insecurity than by his disease itself.
This underscores the urgent need for a holistic approach that integrates social and financial well-being into healthcare solutions, ensuring meaningful care that truly supports older adults in remaining healthy and independent.
One solution that my organization is taking is to dedicate a portion of our assets to launching an impact-investing strategy. We envisioned a mission-centered approach with a demographic focus on marginalized older adults. Now, in our second year, we are focusing on services and solutions to enable aging in the home and community. To be clear, our investments are not concessionary—we know we can deploy capital in ways that generate returns and create long-term social impact.
Diversifying Investment Approaches And Managing Risk
Organizations can leverage capital beyond traditional grantmaking through impact investing. Leaders have the opportunity to foster innovation, scale sustainable solutions and drive systemic change in long-term services, housing and community-based care.
Challenges and risks include ensuring alignment by educating the board and stakeholders to build confidence and bridge the gap between strategy and execution—what some call the “chasm to cutting a check.” Impact investing in this space requires a long-term strategy rather than a quick fix.
On the execution side, deal flow guardrails must be clearly defined, ensuring investments align with the mission beyond financial returns. However, prioritizing mission alignment and differentiation may also narrow the pipeline of eligible deals, requiring a thoughtful approach to balancing impact and investment viability.
Creating Value Through Cross-Sector Partnerships
The time has come for a new investment paradigm centered on caring for older adults and creating a dynamic opportunity for public-private partnerships to deliver meaningful health outcomes, quality care and financial growth. Impact investing is well positioned to bridge market gaps, catalyze new models and attract new investors to advance policy and systems change.
I suggest leaders focus on addressing the critical needs of older adults while motivating and inspiring others who share this mission. In this current environment, there is a growing demand for creative financing solutions that meet innovators where they are on their journey to scale and growth, and I see great potential to grow the field and build capacity and confidence in investing in the lives and futures of older adults.
Attracting a broad spectrum of co-investors, from nonprofit and for-profit foundations to commercial banks, can help leaders unlock new sources of funding for sustainable solutions for the aging sector while managing risk for investors.
Let’s be the changemakers who recognize the potential as our population ages and build the pathways for all older adults to live better, longer, and more independently.
The information provided here is not investment, tax, or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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