Social Finance is currently seeking applicants nationwide for free technical assistance to develop outcomes rate cards. Learn more here.
Outcomes rate cards are a menu of outcomes that government seeks to achieve and the prices they are willing to pay for each outcome achievement.
They are used as a procurement and contracting tool with the ability to standardize performance-based financing, through Pay for Success, and drastically reduce the time such deals take to get to market. One rate card can result in multiple contracts with multiple providers, who must deliver against its pre-determined outcomes and prices, receiving payment only when the stated outcomes are achieved and participants’ lives are positively impacted.
Outcomes Rate Card Process
To develop an outcomes rate card, government selects outcomes, identifies target population(s), sets prices, and selects an evaluation/measurement methodology as the basis for a PFS procurement for multiple service providers
The outcomes rate card is a tool to launch multi-provider procurements with the ability to innovate the US PFS market by standardizing processes, expediting development timelines and significantly increasing the number of PFS projects launched.
The Innovation Fund, the first outcomes rate card project developed in the UK, leveraged a single rate card to:
- Serve up to 17,000 at risk youth ages 14-24
- Launch two separate rounds of open competition
- Deploy roughly £30 million of capital
- Prompt over 130 interested service applicants
- Finalize 10 contracts with 6 providers across the UK
- All 10 Innovation Fund pilots have been deemed successful by project partners
Current Outcomes Rate Cards in the UK
DWP Innovation Fund
The First UK Rate Card Project: The Innovation Fund pilot initiative launched by the Department for Work & Pensions in 2011 aimed to support disadvantaged young people considered to be NEET (not in education, employment, or training).
The £30m Innovation Fund was structured as 100% payment-by-results, contracted with six service providers across two rounds of open competition, and served over 17,000 at risk youth.
Youth Engagement Fund
Launched 2014, the £16.5m Youth Engagement Fund (YEF) builds on the existing DWP Innovation Fund to pay for positive education and employment outcomes achieved by projects that support 8,000 disadvantaged young people between the ages of 14 and 17 across 100 schools in England.
It aims to find new ways to address the challenges faced by disadvantaged young people. 39 bids were submitted and 4 were selected.
Fair Chance Fund
Launched January 2015, the Fair Chance Fund (FCF) is designed to help 2,500 of the most vulnerable young people in society by assisting them into accommodation and into education and training or sustained employment.
The £15m fund represents an joint effort by the Department of Communities and Local Government as well as the Cabinet Office. Over 150 organization submitted bids and ultimately 7 were selected.
Social Finance believes in a solutions-oriented approach to solving challenges. Outcomes rate cards expand the spectrum of PFS tools available in the US, to tackle this country’s most pressing social issues.
There is no “one PFS fits all” answer. Outcomes rate cards and other outcomes-focused mechanisms can all be tools to drive social progress, when designed thoughtfully.
In a time of rising need and shrinking resources, we need to embrace innovation and give government multiple tools with which to tackle social challenges. Outcomes rate cards provide one promising solution to contract multiple PFS projects, improving social outcomes for people in need.