I was recently speaking to a senior leader of an academic medical center about working together, and he said one barrier to doing so was that we were a venture backed, for profit company, implying that they (as a not for profit) might somehow be tainted by our relationship. This is not the first time I have heard this. Many even sophisticated people in health care have a knee jerk perception that not for profits must be good, and for profits bad.

As with most things in life, the truth is much more complex. All organizations in the long run need to make a profit — ie their revenue must exceed their expenses, or they go out of business. I have been to board meetings of not for profit and for profit health systems, and it is often impossible to tell the difference in the discussions and issues they face.

Tax status in reality has no bearing on how mission-driven a company is, or how much it tries or is able to promote the public interest. For instance many not for profit hospitals have been accused of charging their uninsured patients (who of course tend to be poorer) a much higher price for the same services as they do for their insured patients. And then when the patients can’t pay right away, they charge high interest rates and then take them to collections.

I started Iora Health and its predecessor Renaissance Health the clear mission of transforming healthcare. We indeed first went to a number of large foundations to see if they would fund a non profit to do what we thought needed to be done, which was to build and demonstrate a new model of care, but every one we spoke to felt this was too ambitious. They would only fund a small incremental program or evaluation of current practices.To truly change health care requires capital, and a discipline to build a sustainable model; thus I decided to build Iora as a for profit company with a strong mission to transform how we deliver health care.

Last week I was honored to be named one of 11 US Ashoka Fellows . The Ashoka Fellowship is a well respected, 25-year-old global organization dedicated to supporting social entrepreneurs- people trying to accomplish social change through grassroots action. While the vast majority of Ashoka Fellows have in the past chosen to accomplish their goals by building not for profit organizations, a small but growing number of us have chosen to do so through for profit vehicles. Ashoka has recognized the tax status of a company is not necessarily a predictor of its mission or potential social impact. It is time others in health care do too.