Virginia receives federal grant to advance Pay for Success in early childhood healthcare (Augusta Free Press)

Governor Terry McAuliffe today announced that the Commonwealth of Virginia has been selected as part of a national competition to assess the feasibility of implementing Pay for Success to expand nurse visiting programs to the high-risk pregnant women in Virginia who need these services, but are not receiving them.

Third Sector Capital Partners, Inc. (Third Sector), the organization that ran the competition, will provide federally funded technical assistance throughout 2015 for a joint initiative between the Virginia Department of Health and the Virginia Pay for Success Council, along with six other awardees.

Speaking about today’s announcement, Governor McAuliffe said, “Pay for Success has the potential to demonstrate that quality prenatal home visiting programs for women with lower incomes significantly reduce infant healthcare costs and future taxpayer burdens while improving the lives of our children.  This is the first time Virginia has considered the Pay for Success model, and we are grateful for the opportunity to work with Third Sector to advance this unique approach.”

Pay for Success (PFS) is an innovative funding model that enables government to draw in greater resources to tackle social problems by tapping private investments for the upfront costs of the programs. If the program is successful in delivering services that measurably improve the lives of people it is meant to serve, then government repays those who made the original investment. If the program does not achieve its target results, government does not repay those who made the original investment. This ensures that taxpayer dollars are being spent only on programs that actually work.

“We are eager to explore Pay for Success as another collaborative approach to creating positive outcomes for children and families in the Commonwealth,” said Secretary of Health and Human Services Dr. Bill Hazel. “As resources continue to be scarce, PFS promises to allow for private investment to demonstrate effective approaches to challenging social issues.”

“Prenatal home visiting programs in Virginia were selected because they have already proven successful in providing measurable outcomes. We are eager to find ways to support these programs that ensure more Virginia children will thrive,”said Dr. Marissa J. Levine, Virginia Health Commissioner. “Using  prenatal home visiting programs as our initial focus, this effort will help us understand how Pay for Success would be accomplished in the state. If successful, this innovative funding model could be applied to other issues important to Virginians.”

The Virginia Pay for Success Council is a collaboration of interested members of private industry, human service and government organizations working for the past year to initiate a model designed to implement proven, productive early childhood programs that increase the life outlook for thousands of Virginia children, strengthen Virginia’s workforce development and competitiveness, and reduce taxpayer burdens.

“Giving our children the best start possible in life is one of the most important things we can do to ensure that Virginia has the best prepared workforce for the jobs of the 21st century,” said Secretary of Commerce and Trade Maurice Jones.  “I am excited about exploring the PFS funding model as one of the tools to finance this essential investment in our workforce during the early years.”

“We are delighted to have this opportunity to work with Third Sector to advance the pay for success model in Virginia, particularly in the area of early childhood health and home visiting,” said Jim Seevers, Board President of the Council.  “We have cultivated an amazing coalition of private sector business leaders, key nonprofit leaders in the areas of early childhood health and home visiting, and we have the right team and right model to bring the pay for success model home to benefit Virginia’s families, taxpayers and philanthropies.”

Third Sector, a grantee of the Social Innovation Fund’s PFS program, announced the selection of Virginia’s joint initiative along with six other awardees (called “sub-recipients”) after a highly selective national competition. The Sub-Recipients include: Austin/Travis County, TX; Bridges Network and Orange County, CA; Commonwealth of Virginia; State of Nevada in partnership with Clark County, NV and Las Vegas, NV; State of Oregon, Marion and Multnomah Counties, OR, and Friends of the Children; State of Washington and Thrive Washington; and Year Up.

“We are honored to work with the Virginia Department of Health and the Virginia Pay for Success Council to measurably improve the lives of high-risk pregnant women and their families in Virginia,” said Third Sector CEO and Co-Founder George Overholser. “Support from the Social Innovation Fund will allow Third Sector to lead a diverse cohort of governments and nonprofits in accelerating their exploration of implementing Pay for Success in the areas of early childhood and youth development.”

In 2014, Third Sector received $1.9 million from the Social Innovation Fund (SIF), a program of the Corporation for National and Community Service (CNCS), to help strengthen the pipeline of state and local governments and service providers prepared to implement PFS projects. SIF uses federal funding as a catalyst for private and public collaborations in three areas: economic opportunity, healthy futures, and youth development. To deliver the technical assistance, Third Sector is partnering with Abt Associates, America Forward, National Association of Counties, National League of Cities, and National Governor’s Association.

Seven PFS programs in the fields of juvenile justice, early childhood education, homelessness prevention and recidivism have been launched in the United States, including Chicago, IL; New York City, NY; Salt Lake City, UT; Cuyahoga County, OH; Massachusetts (two projects); and New York.

About Third Sector Capital Partners, Inc.: Third Sector is a 501(c)3 nonprofit whose mission is to accelerate America’s transition to a performance-driven social sector. Third Sector is making Pay for Success a reality in the United States. Third Sector leads governments, high-performing nonprofits, and funders in building collaborative initiatives that re-write the book on how governments contract social services, by funding programs that work, saving taxpayer dollars, and measurably improving the lives of people most in need. Third Sector is a recipient of the Corporation for National and Community Service’s Social Innovation Fund. Learn more atnationalservice.gov/sif.

About the Corporation for National and Community Service: The Corporation for National and Community Service is a federal agency that engages more than five million Americans in service through its AmeriCorps, Senior Corps, Social Innovation Fund, and Volunteer Generation Fund programs, and leads the President’s national call to service initiative, United We Serve. For more information, visit NationalService.gov.