Utilizing Flexible Funding Strategies in Public Health

July 21, 2026 | Clint Grant, Megan DeNubila-Griffin, Corinne Gillenwater

Executive Summary

This toolkit is designed to support public health agency staff in understanding, assessing, and using flexible funding strategies (i.e., braiding, blending, and layering) in their programmatic work. It dives into the following core strategies:

Invest in Financial Infrastructure and Staff Capacity: Dedicate time and resources to identifying fiscal management systems and training opportunities for staff.
Develop and Sustain Cross-Sector Partnerships: Build and maintain meaningful relationships across different divisions, teams, and sectors.
Identify Shared Goals and Create a Funding Inventory: Determine overlapping priorities and note all available funding streams to meet those goals.
Cultivate Leadership, Funder, and Community Buy-In: Communicate the value of flexible funding to different audiences, aligning methods with identified needs.
Select and Pilot the Appropriate Flexible Funding Model: Choose braiding, blending, or layering based on an analysis of benefits, limitations, and compliance requirements. Keep track of lessons learned.
Build Flexible Funding Infrastructure: Develop implementation-focused documentation and compliance systems.
Collect, Evaluate, and Report on Impact: Track impact data and regularly communicate outcomes to various partners.
Embed Sustainability and Continuous Improvement: Think long-term from the start, integrating sustainability and quality improvement principles into flexible funding processes.

After engaging with this toolkit, public health agency staff will be better prepared to start or continue using flexible funding methods to develop and sustain more comprehensive programming.

Introduction

Public health agencies traditionally rely on a complex framework of federal, state, local, foundation, and private revenue streams. Since many of these funding mechanisms operate in silos or are topic-specific, agencies can face barriers in designing comprehensive, upstream interventions that address various health outcomes.

Flexible funding strategies such as braiding, blending, and layering can empower health agencies to align different funding streams around a unified objective. When strategically executed, flexible funding strategies can optimize resource allocation, address critical service gaps, minimize administrative duplication, support cross-sector partnerships, enhance sustainability, and address root causes of poor health outcomes. Grounded in lessons learned shared during conversations with health agency staff, this toolkit provides a practical framework to assist public health agencies in successfully planning, structuring, and implementing flexible funding arrangements.

How to Use This Toolkit

Use this toolkit to incorporate flexible funding strategies into your operational and project management procedures. Read it in its entirety or specific sections — focused on strategy implementation, solutions to common barriers, and state spotlights — depending on where your organization is in its flexible funding journey.

Key Concepts

Flexible Funding

Flexible funding is an approach to public health financing that allows health agency staff to be strategic with and combine funds in different ways. Unlike traditional funding schemes, which often designate funds for categorical or disease-specific work, flexible funding provides more freedom to use dollars to better meet agency and community needs. It also fosters cross-sector collaboration, multisector partnerships, and community engagement. Health agency staff can use multiple funding streams to pilot innovative public health initiatives that more comprehensively and sustainably address community needs.

Braiding, Blending, and Layering

There are three primary flexible funding solutions: braiding, blending, and layering. Here are definitions, helpful use cases, and jurisdictional examples for each method to help remember key differentiators:

Braiding

Definition: Coordinates multiple funding streams, interweaving them toward a common public health goal but still allowing each funding source to maintain its own identity.

Use Case: Use with funding streams with strict compliance restrictions or requirements but overlapping activities. This is the most used method for state health agencies.

Example: Rhode Island braided federal, state, and other funding sources into a flexible model that supports community-driven solutions and positive health outcomes.

Blending

Definition: Pools several funding streams into a single stream, foregoing individual identities, when program goals align.

Use Case: Use with funding streams with high flexibility in grant requirements and nearly identical project goals, as sources are not tracked individually.

Example: Western Idaho Community Health Collaborative is a public-private partnership that blended funding sources from community-led health initiatives.

Layering

Definition: Stacks funding, often on top of a foundational source, with each source maintaining its own budget and reporting requirements.

Use Case: Use when one foundational source (or layer) reliably covers foundational/operational costs, and add supplemental services (or additional layers) on top.

Example: Commonwealth of the Northern Mariana Islands layered funding streams to integrate chronic disease programs and address community factors that impact health.

Core Strategies

Invest in Financial Infrastructure and Staff Capacity

Flexible funding methods are complex and require meticulous tracking, documenting, and reporting. To meet these needs, state health agencies must invest in their financial infrastructure by developing or purchasing fiscal management systems and providing training opportunities for staff to enhance capacity. In addition, it is recommended that agencies consider hosting regular office hours to foster peer-to-peer support and share best practices related to flexible funding strategies.

Seeking input, advice, and lessons learned from other state and local health agencies with experience leading efforts supported by flexible funding strategies can prove beneficial. Find or develop resources that outline key steps, such as how to coordinate funding streams and train staff to support alignment and integration across grants.

Solving Common Barriers: How to Manage Complex Flexible Funding Requirements

Agencies frequently contend with inadequate tools, insufficient staffing, and antiquated systems, hindering their ability to effectively manage the complex requirements inherent in multi-faceted funding arrangements. Double down on developing and implementing robust internal systems and enhancing staff capacity to efficiently manage complex flexible funding requirements. Developing a documentation template library can be helpful, too.

Develop and Sustain Cross-Sector Partnerships

Build relationships with health agency staff across different divisions, teams, and topic areas. Avoid reaching out only when funding challenges arise. Instead, maintain long-standing relationships with regular connection points so that collaboration occurs naturally and flourishes based on established trust.

Leverage pre-existing networks, workgroups, and standing meetings. If not yet established, set up regular in-person meetings or virtual calls with staff working in other divisions to discuss current and future funding opportunities; focus attention on where these could be braided, blended, or layered. Similarly, conduct consistent outreach with partners in the community, looping them into the work and making room for meaningful engagement. Engage communities as co-designers of flexible funding efforts and move at the speed of trust, sustaining these connections beyond any one grant cycle.

Outside of the health agency, cultivate different community-based and non-traditional partnerships, such as with universities, church groups, private businesses, and restaurants. Communicate why the partnerships are mutually beneficial, noting the impacts of sharing resources and pooling funding.

Identify Shared Goals and Create a Funding Inventory

Work with partners to identify shared goals across grants and workplans. Once partners have built rapport and established trust, share information about grant-funded projects. What project goals do you have in common? Are there any shared goals outlined in your state or community health assessments or improvement plans? Are there feasible pathways to pool resources and share the work? Note and refine shared goals in a folder, guide, or checklist accessible to all partners to build institutional knowledge.

To maximize flexible funding, agencies must break down internal silos by leveraging existing networks and establishing regular communication across divisions. Moving from transactional exchanges to trust-based relationships allows internal partners to transparently share grant-funded workplans and identify overlapping goals. Centralizing these shared objectives in an accessible workspace makes it easier to uncover practical pathways for pooling resources, minimizing duplication, and effectively braiding, blending, or layering funds.

Create an inventory of all available funding streams. Use a chart, spreadsheet, or other tool to document all active funding sources. Elements to document may include:

Funding source, name, type, and start and end dates.
Administering agency.
Program goals.
Allowable activities.
Ineligible expenditures.
Reporting requirements.

Cultivate Leadership, Funder, and Community Buy-In

Share the flexible funding proposal with health agency leadership, demonstrating its value and addressing questions or concerns. Discuss plans with funding officers and obtain their input and approval before implementing flexible funding. In addition, gather insights from external partners and community members to align shared project goals and flexible funding methods with identified needs.

Solving Common Barriers: How to Secure Support

A persistent challenge lies in demonstrating a clear return on investment, making it difficult to secure consistent internal support and commitment from leadership. Find champions within leadership that are willing to sponsor your cause. Providing them with clear and concise messaging as well as talking points that highlight the return on investment can help to secure and broaden buy-in.

Select and Pilot the Appropriate Flexible Funding Model

Look at the benefits and limitations of each flexible funding model, verify compliance requirements, and select the appropriate model for your organization. Then, draft a succinct proposal describing why flexible funding should be used and how it may improve project outcomes.

Now, pilot different programs using flexible funding methods. While braiding, blending, and layering funding can lead health agency staff into relatively uncharted territory and feel daunting, it also presents opportunities for innovation. Be sure to track the usage of each funding stream and the outcomes contributed to individual and combined streams.

Build Flexible Funding Infrastructure

Identify existing (or develop your own) flexible funding infrastructure. Establish documentation and compliance systems — using or creating funding stream tracking spreadsheets, alignment matrices, workplan visuals, staff time allocation charts, and other planning resources. Document how flexible funds are used and tracked, and create processes to account for staff time, expenditures, activities, workplan progress, partner invoices, and other compliance requirements. Clear, practical, and implementation-focused documentation can help overcome barriers associated with flexible funding.

Solving Common Barriers: How to Address Administrative Burdens

Stringent demands of compliance necessitate meticulous documentation, which can impose significant administrative burdens, particularly on smaller community-based partners with limited resources. To address this, break down silos. Actively foster and incentivize cross-agency collaboration (see Washington’s State Spotlight) through the establishment of shared organizational structures, joint planning initiatives, and integrated workgroups that promote interdepartmental synergy.

Collect, Evaluate, and Report on Impact

Tracking and reporting are crucial to a successful flexible funding experience. Trace impact data back to individual and combined funding streams, noting whether flexible funding methods enabled outcomes that would not have been possible through a single grant alone. In addition, develop methods for sharing outcomes (e.g., data dashboards, webinars, or other communication tools). Publish reports regularly and emphasize benefits for different partners. When possible, supplement comprehensive reports with concise summary documents for partners with limited time and capacity.

Be sure to tailor communications about impact to specific audiences — the information most important to a federal funding officer may differ from what is most meaningful to a community-based organization. Consider what each audience values and why they should support continued investment in flexible funding approaches. Finally, build the evidence base so future opportunities can use flexible funding strategies with fewer administrative restrictions and burdens.

Solving Common Barriers: How to Track Flexible Funding Outcomes

A critical gap exists in the availability of robust evaluation models capable of comprehensively tracking outcomes across braided, blended, or layered funding streams, limiting widespread scalability and replication. To effectively evaluate flexible funding, take a staggered approach that combines tracking, data collection, and reporting. Grant management software ensures compliance by creating an auditable paper trail. Meanwhile, logic models help attribute specific outcomes to their funding streams. Consider the CDC-developed PHHS Block Grant Evaluation Framework as a novel practice that can guide overall flexible funding evaluation.

Embed Sustainability and Continuous Improvement

Embed sustainability into the process early and often, considering how flexible funding can persist beyond any one grant cycle. Dedicate time, effort, and appropriate compensation to building and maintaining relationships with agency leadership, funders, external partners, and community members.

Each grant year, recommit to shared planning processes, common language around funding goals, data-sharing practices, and leadership structures through written agreements (e.g., charters, memoranda of understanding (login required)).

Practice continuous quality improvement throughout implementation. Document successes and challenges, address barriers as a team, and identify solutions to strengthen documentation, compliance, evaluation, and reporting processes. Use quality improvement models such as Plan-Do-Study-Act to strengthen areas needing refinement and support long-term sustainability. Additionally, familiarize your team with change management tools to better meet ever-evolving needs and considerations.

Solving Common Barriers: How to Sustain Relationships in the Community

Consistent staffing shortages and capacity constraints severely limit the time, funding, and planning needed to sustain vital relationships with community co-creators. Proactively engage with grassroots organizations, nonprofits, private sector entities, and other community partners at the earliest stages of program development, actively centering them as co-creators rather than mere implementers. Leverage their expertise and resources to advance community-centered solutions. Stay committed to shared leadership models, appropriate compensation, and sustained, intentional relationship-building.

State Spotlights

Explore lessons learned from flexible funding experiences in Arizona, California, Colorado, Kansas, Oklahoma, Virginia, and Washington.

Approach: AZ REACH is a program that facilitates acute medical care patient transfers for 30 rural, Indian Health Service, and critical access hospitals across Arizona. Started during the COVID-19 pandemic, this free, 24/7 service has evolved to coordinate placement calls, connect providers, and conduct follow-ups. The funding landscape for this program varies each year, motivating the team to remain flexible. Originally supported by COVID-19 funds, the program now braids funds from public health organizations, hospital preparedness programs, IHS, the American Rescue Plan Act, and state general funds.

Partnerships: AZ REACH succeeds because of strong partnerships among public health, payers, hospitals, and academia, namely the University of Arizona. The team emphasized the importance of securing buy-in from all stakeholders across the care continuum.

Innovation: The AZ REACH team used funds innovatively to create a statewide resource that improved access to care for patients at rural, tribal, and critical access hospitals. Their services alleviate administrative burdens associated with interfacility transfers, allowing providers to prioritize patient care. With those powerful outcomes in mind, they are currently working to build funding for AZ REACH into the state legislative budget to sustain services. The team has noted how important it is to seek out legislative champions to help support the cause.

Key Lesson: As the Arizona team pointed out, when a “largely invisible program” drives positive patient outcomes and makes providers’ lives easier, it is crucial to let the data do the talking. Collecting, analyzing, and reporting positive financial, operational, and clinical data (i.e., transfer metrics and provider testimonials) is key to maintaining buy-in and securing sustainable flexible funding.

Approach: The California Department of Public Health (CDPH) leverages flexible funding to braid Medicaid, federal Block Grants, and state general funds to address nutrition insecurity and food access across different communities.

Partnerships: CDPH collaborated with agricultural agencies, food banks, community-based organizations, public universities, and managed care plans, thanks to flexible funds.

Innovation: CDPH piloted programs connecting clinical settings with community food resources, enabling “Food as Medicine” programs through braided funds.

Key Lesson: Investing upfront in their financial infrastructure (e.g., dedicated staff, legal review, reporting systems) was critical to unlocking and sustaining flexible funding.

Approach: The Colorado Department of Public Health and Environment (CDPHE) utilized flexible funds, including a CDC diabetes grant and CDC State Physical Activity and Nutrition grant, to pilot nutrition-specific interventions addressing food security gaps in rural and urban communities to impact maternal and child health.

Partnerships: CDPHE bridged departmental silos among public health, Medicaid, and human service agencies, enabling coordinated interventions that no single grant was able to fund.

Innovation: CDPHE developed a longitudinal data system, Health eMoms, from an innovation workgroup leveraging flexible Preventive Health and Health Services Block Grant funding to track maternal and child health over time.

Key Lesson: A culture of continuous quality improvement and strong leadership buy-in were essential drivers of innovation. CDPHE gained internal agency support, which gave them “permission” to take risks and pilot new program models.

Approach: The Kansas Department of Health and Environment (KDHE) adopted a broad public health strategy, viewing Block Grants as a flexible tool for cross-bureau partnerships rather than isolated deliverables. Instead of checking boxes for disease-specific grants, the agency braided funding (such as Title V grants) to support staffing and programs in other divisions. For example, KDHE used maternal health funds to strengthen disease control efforts for congenital syphilis and sexually transmitted infections.

Partnerships: KDHE bridged internal silos among the public health, Medicaid, and environment divisions, and built partnerships with external organizations. Key partnerships included the Kansas Children’s Service League for referral services, the Kansas Association of Local Health Departments for local engagement, and the University of Kansas' Center for Public Partnerships & Research for Title V stakeholder engagement. The Kansas Power of the Positive initiative unites Title V funds, the Bureau of Health Promotion's ACEs work, the Kansas Children’s Service League, and other community partnerships to develop surveys for family-friendly workplaces (e.g., through this work, the Kansas Department of Commerce was recently recognized as a certified Family Friendly Workplace). The Medicaid workgroup collaborates with experts to identify sustainable, reimbursable practices. Other partnerships involve the Kansas Breastfeeding Coalition and local health departments as sub-recipients.

Innovation: In creating the Kansas Power of the Positive collaborative, KDHE innovated by assigning existing staff as dedicated leads for grants (e.g., the Public Health Infrastructure Grant (PHIG), COVID-19 relief funds) and using temporary staff to operationalize new funding streams before scaling back to core teams. This ensured an efficient startup with permanent overhead.

Key Lesson: Sustainability remains a key concern due to unpredictable annual funding. Short-term, disease-specific federal grants push agencies into constant "response mode” and result in staffing vulnerabilities, where losing one funding source can mean losing an entire position. Achieving success necessitates long-term planning (preferably through three- to seven-year grants) and the ability to pool funds across bureaus to meet gaps that rigid, single-purpose grants cannot cover.

Approach: The Oklahoma State Department of Health (OSDH) Injury Prevention Service leveraged Preventive Health and Health Services Block Grant funding with CDC Core State Injury Prevention Program funding and state funds to grow a child passenger safety education and seat installation program.

Partnerships: OSDH has enhanced its program by fostering partnerships with state and local-level Safe Kids coalitions, community-based organizations, and health systems. While the health department has made car seat safety resources available in county health departments, other partners provided support by planning and managing events and offering branding, marketing, physical space, and staff time to the health agency. The OSDH child passenger safety program now covers all 77 counties in the state.

Innovation: Motivated by great demand for program growth, OSDH searched for creative solutions to fund and support child passenger safety technicians and car seats that could be provided at no cost to low-income families. An innovative braiding strategy that drew upon transportation safety, preventative health, and injury prevention streams allowed the program to braid funds that could be used for supplies, personnel costs, training courses, and support for partners.

Key Lesson: Using creative strategies and staying open-minded to new opportunities allowed the program to grow to meet the demand for greater access to child passenger safety resources.

Approach: The Virginia Department of Health (VDH) braided funds around shared public health priorities, focusing on infrastructure modernization, workforce development, and chronic disease prevention while maintaining funder compliance.

Partnerships: Success depended on strong partnerships among internal grant management teams and external partners (e.g., health systems, community health worker organizations, universities, and community-based organizations).

Innovation: VDH leveraged braided funding to modernize their public health infrastructure, enhance chronic disease management and community health worker care models, and create scalable approaches that could be replicated throughout the state.

Key Lesson: Effective braiding requires creativity, compliance expertise, strong partnerships, workforce planning, and long-term strategic thinking. With navigating complex systems, grant management skills and cross-program collaboration are essential for success.

Approach: Using a braided approach, the Washington State Department of Health (WADOH) was able to use multiple sources of COVID-19 emergency funding across programs. Close coordination among program, finance, and procurement teams helped implement community-centered contracting approaches that created more flexible funding opportunities and got resources out more quickly. These efforts made it easier for community-based organizations to access funding and support community-driven work while still meeting state procurement requirements. They also built sustainability through relationship building, trusted messengers, and intentional outreach strategies.

Partnerships: Internal partnerships were critical here, specifically with procurement and finance. WADOH invested in community partnerships through transparent communication, technical assistance, and pre-bid conferences that helped community-based organizations and other prospective applicants understand requirements and feel confident applying. WADOH has continued to maintain open lines of communication with community partners. The team also had internal conversations about how they classify and fund these organizations.

Innovation: WADOH contracted with larger community-based organizations that had the capacity to manage competitive solicitations and subcontracting. This model reduced administrative burden for smaller, community-rooted partners while maintaining accountability and compliance. This approach also helped expand access to funding, leverage trusted community relationships, and align roles and responsibilities with organizational capacity.

Key Lesson: WADOH was able to braid funding and use innovative subcontracting methods to disperse resources throughout different communities where they were needed most. These investments helped build sustainable partnerships and community capacity that can continue beyond individual funding cycles.

Implementation Tools

Download and customize the following tools to facilitate flexible funding processes in your jurisdiction.

Organizational Readiness Checklist (automatic Word download): This resource helps health agency staff determine existing strengths and gaps related to key elements for successful flexible funding (e.g., financial systems, interagency relationships, and documentation processes).
Flexible Funding Project Template (automatic Word download): This resource outlines crucial components of a project proposal supported by flexible funding models. Completing this resource is helpful both for planning and securing buy-in among partners.
Compliance Checklist (automatic Word download): This resource, which is to be completed monthly, facilitates financial tracking, activity documentation, compliance review, reporting requirements, and partnership building. It helps alleviate the administrative burden associated with flexible funding strategies.

Additional Resources

ASTHO

External

Why Public Health Works Better With Flexible Funding by PHIG Partners
Innovation Snapshots: Braided and Blended Funding by NACCHO
Impact Story: Flexible, Timely, & Pooled Funding Key to Supporting Communities, Saving Lives by Public Health Institute
Public Health Finance and Infrastructure Support Framework by CDC

Reviewed by Erin Bayer, MPH, Senior Director, Chronic Disease Prevention & Health Improvement; Kristin Sullivan, Director, Public Health Systems Improvement & Infrastructure; Melissa Touma, MPH, Director, Public Health Infrastructure Program; Sara Bell, MPH, Senior Analyst, Public Health Systems & Planning; Ankur Jain, MPH, Public Health Data Modernization & Informatics.

This work was supported by the Centers for Disease Control and Prevention of the U.S. Department of Health and Human Services (HHS) as part of a financial assistance award totaling $150,000 with 100 percent funded by CDC/HHS. The contents are those of the authors and do not necessarily represent the official views of, nor an endorsement, by CDC/HHS, or the U.S. Government.

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