A coalition in Utah is expanding access to high-quality preschool for low-income students in the Granite School District and ultimately creating savings for the district as fewer children need special education and remedial services when they start kindergarten.
South Carolina wants to expand the Nurse-Family Partnership home visiting program, a proven way to curb child abuse and neglect, strengthen parent-child bonds and support school readiness. The state says the investment will mean improved outcomes for children, a boost to the local economy and more effective government.
Behind both of these efforts is a Pay for Success model, an innovative funding strategy that leverages private and public investments to scale and ensure high-quality social services. A growing number of states and governments are already having great success with Pay for Success.
Over the next year, the state Department of Early Learning and Thrive Washington, with help from Third Sector Capital Partners, Inc., will explore whether a Pay for Success model could help expand the state’s nationally recognized Home Visiting Services Account and help more babies and families in vulnerable communities throughout the state get a better start.
Washington was selected as part of a national competition run by Third Sector Capital Partners, Inc. During 2015, they will provide DEL and Thrive, along with six other awardees, federally funded technical assistance. Third Sector’s work is supported by a grant from the Corporation for National and Community Service’s Social Innovation Fund.
Since December 2010, the state’s Home Visiting Services Account has been using combinations of private, state and federal funds to provide more home visiting services to families living in some of Washington state’s most vulnerable communities; funds also support the professional development of home visitors and ensure programs get the results they promise. The account now has the capacity to serve 2,000 children statewide.
But that still only reaches a fraction of families who could benefit from home visiting. There are currently as many as 30,000 families who are eligible for home visiting services but can’t get them.
“We have a proven model that results in positive outcomes for children and their families and also has the potential to actually reduce the costs of services to the state as a whole, so it’s being smart both in terms of getting the results we want, and in doing it effectively and doing it efficiently,” said Peter Berliner, managing director at Mission Investors Exchange, a Seattle-based organization supporting the feasibility study. Mission Investors Exchange is a project of Philanthropy Northwest.
Under a possible Pay for Success model, DEL and Thrive could establish a set of outcomes tied to improved health among children and families. One target, for example, could be lengthening the time between births among at-risk mothers. This could reduce the number of low-birthweight infants, potentially saving money within Medicaid.
The state is well positioned to develop this new funding hybrid because of its track record of innovation in early learning and its existing infrastructure. Washington was the first state in the nation to create a cabinet-level position for its early learning agency leader, has a 10-year Early Learning Plan, and uses a cross-agency governance system that encourages collaboration among public agencies.
Research has already shown home visiting saves a lot of money over a child’s life — lower health-care costs, higher earnings and more stable lives. The Nurse-Family Partnership, for example, returned $5.70 for each dollar invested to help high-risk families, according to a 2005 RAND Corporation study.
Home visiting isn’t the only state program that could benefit from Pay for Success. The state’s Health Care Authority reports it is exploring the possibility of using Pay for Success to support moving people in health care institutions to community-based sites.
DEL and Thrive should know by the end of the year whether Washington could use Pay for Success to expand home visiting.