Outcome-Based Financing to Cure Disease (Nonprofit Finance Fund)

Have you had a friend or family member who was diagnosed with a serious illness that could not be cured? Did their disease progress and their symptoms persist despite multiple doctor and hospital visits, tests and prescriptions? Were you frustrated that a health care system that costs $3.3 trillion per year couldn’t effectively manage or cure the disease?

That was where I found myself in 2016 as I was leading the Pay for Success financing program for the Institute for Child Success, helping cities and states study the feasibility of using PFS financing to expand successful early childhood programs. My brother Eric was diagnosed with a disease called pancreatitis, a degenerative disease with no known cure. I watched him lose weight and suffer from excruciating, debilitating pain.

After figuring out where the pancreas is and what it does, he and I set out to understand why there is no effective treatment for a disease that affects about 150,000 people in the US, including approximately 10,000 children. Here’s what we learned:

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Issuing Bonds to Invest in People (New York Times)

Renee Beavers, a social worker in Connecticut, visits mothers — and a few fathers — who have young children and substance use disorders.

Her clients in the state’s Family Stability Pay for Success Project spend intensive time with Beavers and the others on her team: three visits of up to an hour each week, for at least six months.

Beavers makes sure the children are safe, does a supervised drug screening — she or a male counterpart goes into the bathroom and watches the client urinate in a cup — and then talks with clients about parenting, and about quitting drugs.

Combining drug treatment and parenting programs in the home, where there are no transport or child-care barriers, not only protects children. It also takes advantage of a drug user’s key motivation to get well.

“Being able to parent a child is the primary positive reason for sobriety,” said Karen E. Hanson, who teaches social work at the Yale Child Study Center and developed the methods the project employs. “We’ve heard many times, ‘I really was not worth stopping for, but my child was.’”

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Q&A: Using PFS to finance community care teams in Connecticut (Urban Institute)

The Connecticut Health and Educational Facilities Authority (CHEFA) is a quasi-public agency—and a PFS-AD training and technical assistance awardee—that issues tax-exempt bonds to finance projects throughout the state for eligible not-for-profits, primarily education and health care institutions. Since its inception, CHEFA has issued more than $19 billion of tax-exempt bonds, working closely with investment bankers to manage and structure these transactions. In addition, they also support non-profits in the state through a grant program, which has distributed approximately $28 million in funding since its inception in 2003.

We spoke with our partners at CHEFA about their interest in pay for success (PFS) as a mechanism to finance the expansion of community care teams (CCTs) in Connecticut. 

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Urban announces two additional recipients of PFSI training and technical assistance (Urban Institute)

We are pleased to announce two new sites have been selected to receive training and technical assistance services (TTA) through the Urban Institute’s Pay for Success Initiative (PFSI). This is our next round of PFSI TTA sites, building on awards announced in early 2016 and those selected in 2017 through partnerships with other PFS organizations.

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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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Why the Best Healthcare Hacks Are the Most Low-Tech (SingularityHub)

5. ‘Securitizing’ Public Health

Sanghavi’s final point tied back to his discussion of aligning incentives. As misguided as it may seem, the reality is that financial incentives can make a huge difference in healthcare outcomes, from both a patient and a provider perspective.

Sanghavi’s team did an experiment in which they created outcome benchmarks for three major health problems that exist across geographically diverse areas: smoking, adolescent pregnancy, and binge drinking. The team proposed measuring the baseline of these issues then creating what they called a social impact bond. If communities were able to lower their frequency of these conditions by a given percent within a stated period of time, they’d get paid for it.

“What that did was essentially say, ‘you have a buyer for this outcome if you can achieve it,’” Sanghavi said. “And you can try to get there in any way you like.” The program is currently in CMS clearance.

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Building support for models like Pay for Success (Quantified Ventures)

Katie Smith Sloan serves as the President and CEO of LeadingAge, a position she has held since January 2016, following 14 years of various leadership positions within the organization. She is also the Executive Director of the International Association of Homes and Services for the Aging. As a previous member of AARP's senior leadership team, she implemented groundbreaking social marketing initiatives to support seniors with health and wellness, economic security, and consumer protection issues.

When I met Katie for this interview, she was wrapping up a complex call with some of her members and Congressional leaders. As she hangs up and turns her attention to this interview, her ability to shift gears so quickly and decisively, as if both meetings carried equal weight, struck me as a likely reason that Katie has been so successful in her life. She’s ready to go, so we jump right in…

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Connected Health Solutions Could Be Reality Sooner Using Pay for Success (Medium)

Last week, the Center for Medicare and Medicaid Services (CMS) released updated payment rules for MACRA, one of the largest federal efforts to move healthcare to a quality-based system.

The previous Thursday I was on a panel at the Connected Health Conference (#Connect2Health) discussing the role of impact investing to scale connected health. I’m sure many of the aspiring entrepreneurs and vendors present at #Connect2Health are still digesting the new CMS payment rules, some of whom are likely ecstatic and others disappointed.

Buried within the thousands of pages of payment rules were several areas that indicate CMS is moving in the right direction when it comes to digital and connected health. New billing codes were introduced related to telemedicine, doctors will be incentivized to consult patient-generated health data via wearables, and progress is being made to allow doctors to bill for remote patient monitoring.

All of these moves will allow doctors more flexibility to be reimbursed for their interactions with patients, which isn’t important solely for the purposes of modernizing how doctors treat patients (which should create efficiencies and reduce costs) — it also opens up the realm of possibilities for how we should use technology to support those with significant challenges accessing care. These changes could be life-saving for the community in rural Alaska with no mental health professionals for hundreds of miles, or the low-income mother in urban Atlanta, who does not have the time to take her four children to see a Primary Care Provider during normal business hours.

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Paula Lantz to Lecture on Social Impact Bonds to Spread Social Service and Mental Health Interventions (University of Arkansas)

Paula Lantz, associate dean for Academic Affairs and professor of Public Policy at the University of Michigan Ford School of Public Policy, will visit the University of Arkansas on Friday, Nov. 3 to give a talk titled "Social Impact Bonds as a Strategy for Spreading Social Service and Mental Health Interventions." 

The talk will take place from 3:30-5 p.m. in Giffels Auditorium in Old Main and is part of the J. William Fulbright College of Arts and Sciences Department of Psychological Science's Graduate Professional Education (GPE) colloquium series. 

Lantz is a leading scholar in health policy and will be speaking about "Social Impact Bonds as a Strategy for Spreading Social Service and Mental Health Interventions," a topic that is highly relevant to the mission of our department and our current GPE grant in particular.

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Stress & Health (& Health Care Spending) (Open Minds)

From reimbursement perspective, there is limited coverage of programs that are more “preventative” in nature. There is limited coverage by the Centers for Medicare and Medicaid Services (CMS) for preventive cardiac rehabilitation programs (Medicare Reimburses For Intensive Cardiac Rehabilitation: A Future With Provider Supported Non-Traditional Treatment) and a recent preventive diabetes program (Medicare To Expand Payment For Diabetes Prevention Programs). And there are some pay-for-success and pilot measures in the works – New Medicaid Chronic Disease Prevention Programs Announced; Two Focus On Mental Illness and Michigan Medicaid & National Kidney Foundation To Test ‘Pay-For-Success’ Model For Diabetes Prevention.

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