Picture this: an intervention in your county has evidence to support that it can reduce preterm births and incidences of child abuse and neglect. You calculate that the intervention, at scale, could save the government millions of dollars a year in medical expenses. You figure that government funding for it should be possible, because the math says paying for the prevention not only is good on its own, it makes sense for taxpayers financially.
However, there is often a glaring glitch: that the amount of money saved by the government accrues some to local government, more to your state government between separate state agencies, and a good amount, in this case, to the federal government. In other words, in this example, no single government entity or agency accrues enough savings to persuade it to fund the intervention. This scenario plays out across our country every day, leaving solutions for improved outcomes in homelessness, early childhood health and development, academic achievement, self-sufficiency and economic security, workforce development and public health on the table. Evidence-based programs were stopped in their tracks from scaling and reaching individuals in need of solutions.
Fortunately, a new bipartisan law called the Social Impact Partnership to Pay for Results Act (SIPPRA) passed last year should help. With SIPPRA, which was rolled into a larger budget agreement, the federal government can now partner with local and state governments to not only pay to prevent social problems and target aggregate cost savings, but to also bring a rigorous level of analysis to decision-making through Pay for Success (PFS) projects.
PFS is an innovative model for financing initiatives that show evidence for improving the lives of vulnerable populations. PFS typically calls for partnerships between the public and private sector, bringing together investors, service providers, and government to grow effective programs with private startup capital. The programs are rigorously studied by academics and data scientists to prove — to the best of their ability — that the programs work (before funding is secured), and professionals evaluate the programs after they have been implemented (and before the government pays for successful outcomes).
SIPPRA requires that state and local governments that propose PFS projects facilitate analysis, quantification, and in some cases, monetization of federal savings. This hard work, once done, will give policymakers and stakeholders a more complete and accurate understanding of the value of investing in evidence-based, preventative interventions. This new, wide-lens understanding of the value of interventions could provide a solid chance at attracting even more resources to improve the lives of at-risk populations and lift communities.
With the increased data collection and analysis spurred by SIPPRA, we could begin to answer questions that, until now, have often eluded us: What are societal outcomes truly worth? What is the value of improved birth outcomes and early childhood development or improving rates of high school graduation or reductions in child abuse and neglect or improving health outcomes or reducing juvenile recidivism or increasing earnings and employment outcomes for the unemployed? (These are just some of the desired outcomes cited in the SIPPRA legislation.)
The only way we can hope to credibly extrapolate the longer-term impact of interventions based on shorter-term outcomes is with good data and research. This is true at the program level, within government agencies, and across government, and it requires collaboration. That’s why asked SIPPRA and Pay for Success experts to gather for a panel discussion at the 2019 Winter Innovation Summit in Salt Lake City, hosted by the Sorenson Impact Center on Feb. 6, to explore the opportunities available to state governments, local governments, and service providers. We discussed the promise of SIPPRA and opportunities for cross-sector initiatives in health and human services.
SIPPRA should lead to improved overall information, which should lead to improved solutions, and hopefully will shift government more quickly toward broadly promoting data-driven policies and investments that benefit those in need. With more understanding of the “true” value or benefit of these interventions, policymakers will have more of the information they require to prioritize public funding for these community-lifting efforts.
Once the range of benefits of an intervention has been analyzed and quantified and the amount government actually pays for each outcome has been established, we as a country will be a step closer to fully understanding the value of a successful prevention program. By more accurately measuring the true value of effective interventions, government also can choose to allocate more resources to adequately compensate providers for the impact they achieve, an important application of market principles to the social services sector, which has historically suffered from inadequate compensation.
Ultimately, SIPPRA provides a critical step toward government determining the value of and payment for meaningful outcomes. Only then will public-sector dollars be used as efficiently as possible to develop the success of our most vulnerable populations and to improve our country, one life at a time.
Janis Dubno is a managing director at the Sorenson Impact Center and was an architect of the first early education Pay for Success project. She focuses on impact analytics and social innovation. She has organized a panel discussion at the 2019 Winter Innovation Summit titled “The Promise of SIPPRA and Opportunities for Cross-Sector Initiatives.” John DelaneyJohn DelaneyDirect air capture is a crucial bipartisan climate policy Lobbying world Coronavirus Report: The Hill's Steve Clemons interviews Rep. Rodney Davis MORE was the lead Democratic co-sponsor of SIPPRA in the House of Representatives and is a presidential candidate.