Outcomes Rate Cards: A Scalable Pay for Success Approach (Center for Health Care Strategies)

With support from the Robert Wood Johnson Foundation, CHCS is examining how Pay for Success (PFS) can help Medicaid stakeholders achieve policy and program goals. A companion blog and a recent book chapter authored by CHCS recently summarized how PFS can support Medicaid objectives, but also highlighted some of the limitations to widespread PFS adoption at the state level. This blog post looks at a new adaptation of the PFS model: outcomes rate cards. This approach offers the potential to bring the benefits of PFS to state government, while mitigating limitations.

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Learning how the PFS intervention affects demographic subgroups (Urban Institute)

PFS projects provide lessons for government that extend beyond the project itself. The knowledge gained can have substantial value even if the intervention is falls short of its outcome targets. This blog is the second of a three-part series that explores such opportunities to learn:

  1. about other service qualities of importance to clients,
  2. how the intervention affects various client demographic subgroups, and
  3. from changes in service delivery procedures during implementation.

This blog describes the second opportunity. 

In most pay for success (PFS) projects to date, the contract already identifies specific demographic groups as the target population for the project. However, not every individual will react to an intervention in the same way. Outcomes can differ, for example, for service recipients of different genders, ages, races/ethnicities, and educational levels. Different subgroups of a target population have different needs and will present providers with varying levels of difficulty in achieving targeted outcomes.

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Using Pay for Success in Medicaid Managed Care and Value-Based Purchasing Initiatives (Center for Health Care Strategies)

In discussing Medicaid, we often use jargon, acronyms, and maxims. Pay for value, not volume. Address social determinants of health (SDOH).

Now, we have a new maxim: Pay for Success (PFS). Over the past few years, states and localities have used PFS principles to fund supports for at-risk momsin-home asthma assessments, and supportive housing. PFS projects typically address SDOH, while maintaining an aggressive focus on outcomes. But until recently, only one state, South Carolina, has used PFS in its Medicaid program.

What Matters: Investing in Results to Build Strong, Vibrant Communities, a recent book published by the Federal Reserve Bank of San Francisco and Nonprofit Finance Fund, discusses the potential impact of PFS on public sector programs. In one chapter, CHCS’ Allison Hamblin outlines how PFS could gain traction in Medicaid. This blog post explores what PFS can bring to Medicaid. It also discusses how PFS can be integrated into Medicaid managed care programs and value-based purchasing (VBP) initiatives, including Medicaid accountable care organization (ACO) programs, and support partnerships with community-based organizations (CBOs).

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This New Blockchain Protocol Wants To Create Accountability For Social Impact (Fast Company)

Impact investors and philanthropic groups are increasingly aligning their funding around the SDGs, according to a recent report from the GIIN. But Conway argues there is a need for greater assurance that investments really produce hoped-for results, and for cutting the cost of evaluating projects. Estimates show that evaluating the effectiveness of development projects costs as much as 5%-7% of the overall budget. Social impact bonds, where public agencies contract with investors and service providers to deliver pre-agreed outcomes (like cutting the rate of prison re-offending or improving childhood literacy) are thought to be even more costly. Evaluation, which is crucial for assessing whether investors should be paid a return on their investment, could go as high as 30% of a social impact bond’s costs, according to some research.

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Pay for Systems Change (Stanford Social Innovation Review)

Local, state, and federal governments in the United States spent $5.4 trillion in 2014, with more than half flowing to education, healthcare, criminal justice, workforce development, and child welfare. Few of the things governments spend money on require strong existing evidence that they work or rigorous ongoing measurement of their impact. The bi-partisan US Commission for Evidence-based Policy Making is the latest salvo in a long-running series of efforts to bring better data into the way government allocates resources.

Imagine what would happen if governments adopted a more performance-based approach to social service contracting. By linking payment more closely with performance, we could build a stronger market for outcomes that we all agree matter—and governments could get more for their, and our, money.

Doing this would require that governments clearly define and measure success, build data-driven program designs, and invest seriously in performance management. It would also require that governments get energized and creative about unsexy things like collaboration, data, and procurement.

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Tracking additional indicators to understand what works (Urban Institute)

Rigorous evaluation of social programs can provide valuable lessons for government. For pay for success projects, which place such evaluation at their core, there are lessons to be learned even if the project does not meet agreed-upon outcomes.

This blog is the first of a three-part series that explores opportunities to learn:

1. what other indicators are important for understanding program quality

2. how the intervention affects the people it served

3. how changes in service delivery procedures during implementation can impact outcomes

This blog describes the first opportunity.

 While evaluations in a pay for success (PFS) project are primarily used to determine whether the project has achieved the target outcomes on which success payments are based, they can also shed light on other outcomes and various process indicators at low marginal cost.

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Tired of Tax Reform? 3 Other Public Finance Trends to Watch in 2018 (Governing)

'Pay For Success' Coming to a Small Town Near You?

There are about a dozen so-called pay for success financing projects around the country, and all are with large governments such as states, counties and major cities. But 2018 is likely to see smaller cities finally get in on the action.

Pay for success programs attract money from private and nonprofit investors for public programs that seek to bettter outcomes in early childhood education, workforce development and opioid misuse, among other things. Governments only pay investors back if and when positive results, such as cost-savings or reduced recidivism rates, are achieved. As mayors and cities continue to face funding pressures, many more are starting to look at pay for success as a possible tool, says Justin Milner, a senior fellow at the Urban Institute.

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County pushes toward elusive goal of treatment on demand (Addiction Professional)

People with substance use problems don’t usually return home to sit by the phone when they’ve been denied immediate treatment. In fact, they often return to what brought them to seek help in the first place. The federal government estimates that overall, around 90% of the people who need rehabilitation for substance use never receive it.

King County, Wash., has embarked on an ambitious effort to reverse the trend. The county Health and Recorder Division oversees a network of 30 providers furnishing addiction and mental health services for the county. County officials have partnered with the Ballmer Group and Third Sector Capital Partners, along with MTM Inc., to find a way to offer patients same-day access to these providers. The program, dubbed “Pay for Success,” directs $1.4 million per year to behavioral health providers that offer treatment on demand to the 22,000 low-income King County residents who will be eligible for the program.

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All I want for Christmas is affordable housing (The Hill)

Most of us have been worried lately about the possible demise of the extraordinary funding tool known as the Low Income Housing Tax Credit (LIHTC). The result of bipartisan legislation in 1986, LIHTC has allowed the public and private sector to fund millions of units of affordable housing that are desperately needed by low-income renters. At the same time, the investment is beneficial for participating businesses, making affordable housing a true public/private partnership.

The need is acute. According to Harvard University’s Joint Center for Housing Studies in The State of the Nation’s Housing 2017, the number of U.S. renter households has been steadily rising. Sadly, more than a quarter of the growth is represented by households subsisting on less than $15,000 in annual income. These are Americans for whom the operating margins to keep a roof over their heads are unspeakably tight. One missed paycheck could spell homelessness.

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Cleveland Officials Eye New Plan to Drastically Reduce Lead (AP)

CLEVELAND (AP) — Cleveland community officials envision an ambitious plan to eliminate lead hazards from over 10,000 homes in the next decade — breaking with a previous plan of cleaning a few hundred homes at a time.

The new plan for removing lead hazards from homes in Cleveland and East Cleveland would require $159 million in upfront investment to be viable, The Plain Dealer has reported. According to Boston-based nonprofit Third Sector Capital Partners, the return on that investment would be about $200 million.

Third Sector Capital was hired by the Cuyahoga County Board of Health in to explore a social impact bond model plan aimed at drastically reducing lead poisoning threats. The board received a $100,000 grant from the Cleveland Foundation to explore the model.

"There's no question that we want to think big," Cuyahoga County Health Commissioner Terry Allan said this month after a private meeting to discuss the plan.

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