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S. HRG. 114–621 

CAN EVIDENCE -BASED PRACTICES 

IMPROVE OUTCOMES FOR VULNERABLE 

INDIVIDUALS AND FAMILIES? 

HEARING 

BEFORE THE

COMMITTEE ON FINANCE 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

MAY 10, 2016 

( 

Printed for the use of the Committee on Finance 

COMMITTEE ON FINANCE 

ORRIN G. HATCH, Utah, Chairman 

CHUCK GRASSLEY, Iowa 

MIKE CRAPO, Idaho 

PAT ROBERTS, Kansas 

MICHAEL B. ENZI, Wyoming 

JOHN CORNYN, Texas 

JOHN THUNE, South Dakota 

RICHARD BURR, North Carolina 

JOHNNY ISAKSON, Georgia 

ROB PORTMAN, Ohio 

PATRICK J. TOOMEY, Pennsylvania 

DANIEL COATS, Indiana 

DEAN HELLER, Nevada 

TIM SCOTT, South Carolina 

RON WYDEN, Oregon 

CHARLES E. SCHUMER, New York 

DEBBIE STABENOW, Michigan 

MARIA CANTWELL, Washington 

BILL NELSON, Florida 

ROBERT MENENDEZ, New Jersey 

THOMAS R. CARPER, Delaware 

BENJAMIN L. CARDIN, Maryland 

SHERROD BROWN, Ohio 

MICHAEL F. BENNET, Colorado 

ROBERT P. CASEY, Jr., Pennsylvania 

MARK R. WARNER, Virginia 

CHRIS CAMPBELL, Staff Director 

JOSHUA SHEINKMAN, Democratic Staff Director 

(II) 

(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Hatch, Hon. Orrin G., a U.S. Senator from Utah, chairman, Committee on 

Finance .................................................................................................................. 1 

Wyden, Hon. Ron, a U.S. Senator from Oregon .................................................... 3 

WITNESSES 

Berlin, Gordon L., president, MDRC, New York, NY ........................................... 6 

Sorenson, James Lee, chairman, board of directors, Sorenson Impact Foundation, Salt Lake City, UT ...................................................................................... 8 

Bright, Tesha, nurse home visitor, Nurse-Family Partnership of Essex and 

Morris Counties, Newark, NJ ............................................................................. 10 

Doar, Robert, former Commissioner, New York City Human Resources Administration, and current Morgridge Fellow in Poverty Studies, American 

Enterprise Institute, Washington, DC ............................................................... 12 

ALPHABETICAL LISTING AND APPENDIX MATERIAL 

Berlin, Gordon L.: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 25 

Bright, Tesha: 

Testimony .......................................................................................................... 10 

Prepared statement .......................................................................................... 32 

Doar, Robert: 

Testimony .......................................................................................................... 12 

Prepared statement .......................................................................................... 37 

Hatch, Hon. Orrin G.: 

Opening statement ........................................................................................... 1 

Prepared statement .......................................................................................... 42 

Sorenson, James Lee: 

Testimony .......................................................................................................... 8 

Prepared statement .......................................................................................... 43 

Wyden, Hon. Ron: 

Opening statement ........................................................................................... 3 

Prepared statement .......................................................................................... 45 

COMMUNICATIONS

Adoption Rhode Island ............................................................................................ 47 

American Evaluation Association ........................................................................... 49 

America Forward ..................................................................................................... 50 

Campaign to End Obesity Action Fund (CEO–AF) ............................................... 54 

Center for the Study of Social Policy ..................................................................... 56 

Child Trends ............................................................................................................ 60 

Corporation for Supportive Housing (CSH) ........................................................... 63 

Institute for Child Success ...................................................................................... 68 

International Foster Care Alliance (IFCA) ............................................................ 71 

Local Initiatives Support Corporation (LISC) ....................................................... 77 

The National Campaign to Prevent Teen and Unplanned Pregnancy ................ 80 

Nonprofit Finance Fund (NFF) ............................................................................... 85 

Perin, Deborah ......................................................................................................... 87 

Quantified Ventures ................................................................................................ 91 

ReadyNation ............................................................................................................. 91 

Page

IV 

Results for America ................................................................................................. 92 

Save the Children Action Network (SCAN) ........................................................... 93 

Social Finance .......................................................................................................... 95 

Third Sector Capital Partners, Inc. ........................................................................ 96 

(1) 

CAN EVIDENCE-BASED PRACTICES 

IMPROVE OUTCOMES FOR VULNERABLE 

INDIVIDUALS AND FAMILIES? 

TUESDAY, MAY 10, 2016 

U.S. SENATE, 

COMMITTEE ON FINANCE, 

Washington, DC. 

The hearing was convened, pursuant to notice, at 2:12 p.m., in 

room SD–215, Dirksen Senate Office Building, Hon. Orrin G. Hatch 

(chairman of the committee) presiding. 

Present: Senators Grassley, Crapo, Scott, Wyden, Stabenow, 

Cantwell, Menendez, Bennet, and Warner. 

Also present: Republican Staff: Chris Campbell, Staff Director; 

and Becky Shipp, Health Policy Advisor. Democratic Staff: Joshua 

Sheinkman, Staff Director; Michael Evans, General Counsel; and 

Laura Berntsen, Senior Advisor for Health and Human Services. 

OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S. 

SENATOR FROM UTAH, CHAIRMAN, COMMITTEE ON FINANCE 

The CHAIRMAN. This hearing will come to order. Good afternoon, 

everybody. I would like to welcome everyone to today’s hearing on 

evidence-based practices and their potential impact on our child 

welfare system. 

According to the Social Policy Institute, ‘‘Evidence-based practice 

is a process in which the practitioner combines well-researched 

interventions with clinical experience and ethics, and client preferences and culture to guide and inform the delivery of treatments 

and services. The practitioner, researcher, and client must work together in order to identify what works for whom and under what 

conditions. This approach ensures that the treatments and services, when used as intentioned, will have the most effective outcomes as demonstrated by the research. It will also ensure that 

progress with proven success will be more widely disseminated and 

will benefit a greater number of people.’’ 

Over the years, in the effort to use taxpayer dollars more efficiently, policymakers have attempted to incorporate more evidencebased practices in order to improve outcomes for vulnerable children and, of course, their families. Just looking at the jurisdiction 

of the Senate Finance Committee, there are a couple of major examples, such as the Regional Partnership Grants and the Maternal, Infant, and Early Childhood Home Visiting Program. 

Many experts and observers agree that when implemented correctly and with strict adherence to the model, evidence-based interVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 R:\DOCS\25244.000 TIMD
2 

ventions can be an effective strategy to help vulnerable families 

and at-risk individuals. They can also reduce bureaucracy and 

eliminate the creation of perpetual and redundant programs that 

do not work, and they can allow for local leaders to decide what 

is best and inject private-sector creativity into social services. 

Most important, evidence-based interventions help ensure that 

taxpayers only pay for what works. In most programs, the Federal 

Government and States pay for processes or simply reimburse for 

costs, while evidence-based interventions, when implemented correctly, help guarantee that government pays for success in achieving a desired outcome. 

This is particularly true in the context of a child welfare system. 

For example, we know that untreated substance abuse and mental 

health issues can lead to situations where children are neglected, 

which is the most common impetus for removing children from 

their homes and placing them in the foster care system. 

However, if we can find ways to effectively address these conditions, more children will remain safely at home. That is why Senator Wyden and I and others on this committee have been working 

for some time now on a proposal to improve the child welfare system. 

A key component of the Hatch-Wyden proposal is that these 

types of interventions must be evidence-based. Currently, we are 

working with our House colleagues on bipartisan, bicameral legislation that we hope will provide more effective up-front services to 

help vulnerable families. 

As part of the discussion on evidence-based practices, we will 

also focus on what some call social impact financing, sometimes referred to as social impact bonds, social impact partnerships, or pay 

for success. I am a strong supporter of this approach, which is why 

I am pleased to have been able to work with Senator Bennet to introduce legislation that will foster the creation of public/private 

partnerships that will harness philanthropic and other privatesector investments to establish or scale up evidence-based social 

and public health programs. 

Furthermore, under our Social Impact Partnership bill, the Federal Government would establish desired outcomes to pressing social challenges that, if achieved, would improve lives and preserve 

taxpayer resources. State and municipal governments could then 

submit proposals to work towards those outcomes by establishing 

or scaling up existing evidence-based interventions. 

We believe this program would encourage private-sector investors to provide the necessary capital to establish or expand the 

interventions. Then, if an independent evaluator is able to certify 

that the desired outcomes are achieved at reduced costs, investors 

would be paid back their initial investment plus a small return 

from the realized government savings. 

There are a number of reasons I believe that social impact financing is key to providing or improving outcomes for vulnerable 

children and families. For example, social impact financing provides for continual program improvement and ensures that all parties remain focused on the performance of the program and have 

the ability to make ongoing adjustments to ensure the outcomes 

are realized. 

3 

In addition, social impact financing gives local leaders the flexibility to design and address programs to fit local needs in order to 

ensure they have the desired impact. And, as I stated earlier, when 

done correctly, social impact financing ensures that taxpayers pay 

only for what works. 

In most Federal programs, taxpayers are on the hook for set 

costs of processes and/or reimbursements with little or no regard 

for effectiveness. With social impact financing, success is measured 

by the ability of the program to achieve a desired outcome, and taxpayers only have to pay for whatever achieves that objective. 

Now, some critics of social impact financing may point out examples where the proposed interventions have not produced the desired results. They will raise examples of specific instances in 

which an intervention did not achieve the desired outcome and try 

to claim that it was failure, but I think these critics are missing 

the point. 

Make no mistake, there have been instances in which, under a 

social impact financing model, a specific proposal has not produced 

the desired outcome and was eventually discontinued. However, 

that is precisely how the model is supposed to work. Indeed, programs and policies that are flexible enough to respond to outcomes—recreating and disseminating successes while eliminating 

failures—is our goal with social impact financing. 

That said, I am willing to admit that there is much more that 

we can and should learn about the implementation and delivery of 

social impact financing. That is part of the reason for today’s hearing. 

Today we will hear from a distinguished panel of witnesses who 

will discuss evidence-based policies and practices and share with us 

some of their successes and warnings for the future. So I look forward to an interesting and robust discussion of all of these issues. 

With that, I will turn to Senator Wyden for his opening remarks. 

[The prepared statement of Chairman Hatch appears in the appendix.] 

OPENING STATEMENT OF HON. RON WYDEN, 

A U.S. SENATOR FROM OREGON 

Senator WYDEN. Thank you very much, Mr. Chairman. I commend you for holding this hearing and also making reference to an 

additional piece of legislation, the bill that you and I and our staffs 

have been working on for quite some time, the Families First legislation. My hope is that we will be able to make significant progress 

on that even before the end of the session. 

I would also like to start off by noting, Mr. Chairman, that this 

may be the first ever hearing the committee has held on this 

issue—the question of evidence-based delivery and funding for social welfare programs. I think it is good that we are setting a 

precedent here, because it is long overdue. 

I also want to single out Senator Bennet because, suffice it to 

say, practically every meeting I go to when people turn to the issue 

of policy, Senator Bennet comes back to the question of child welfare. He comes back to it again and again and again. I want him 

to know I appreciate it. He is the leader of this committee on this 

issue, and we are glad he is doing it. 

4 

Now, today is a good opportunity to dig into an issue that really 

ought to be underpinning the work that the Congress does every 

day. That is to say, asking whether the laws that are being written 

are working as they ought to be. So the real question this afternoon 

is, does the way the Federal Government funds social welfare programs obstruct or facilitate their improvement? 

In this committee, there are shining examples on both sides of 

the spectrum. Home visiting grants fund a variety of models to 

help parents of young children essentially improve their parenting 

skills. More resources are available for programs that can demonstrate the best results, with help along the way for newer, promising programs to build up an evidence base. 

Home visiting models have had significant success. They have 

led to healthier births, reduced child maltreatment, reduced criminal justice system involvement, and higher employment rates for 

the parents. 

On the other end of the spectrum is the Temporary Assistance 

for Needy Families program. There are real questions about whether the way success is measured in TANF is leading to success for 

the families it is meant to help and who urgently need this assistance. 

Instead of rewarding States for helping families find work or reduce poverty, TANF rewards States for simply reducing the number of families they serve regardless of need. While a small amount 

of TANF dollars is reserved for welfare research, there is really no 

process for collecting feedback to ensure that what is being paid for 

is actually producing real results. Congress ought to be finding 

ways to build programs that ensure continuous improvement. 

Now, there are certainly limitations to this approach of funding 

what works and not funding what does not. To start, researching 

and evaluating programs can be expensive. In some programs, it 

could be unethical to have a control group that is actually denied 

services. 

For example, it would be wrong to deny a child access to foster 

care when he or she is being abused or neglected just for the sake 

of scientifically evaluating the effects of foster care against a control group. Additionally, bringing evidence-based programs to a 

larger scale can also be expensive. They often rely on a highly educated and trained workforce. So progress can be slow on these 

kinds of programs. 

Finally, reasonable people can differ on what it really means for 

a program to be successful, using a variety of measures. For example, there is no question the SNAP program has had success in reducing hunger and food insecurity for many families across the Nation, but others may place less value on those outcomes. 

I know that witnesses today will speak to new approaches to 

testing out and paying for innovation, especially social impact financing or what has come to be called pay for success. 

My home State of Oregon is exploring the feasibility of social impact financing. Like many States, Oregon is witnessing firsthand 

the challenges with deciding whether taxpayer dollars should be 

used for this type of finance. 

I look forward to discussion around the strengths and limitations 

of the model. 

5 

So, Mr. Chairman, again I commend you and Senator Bennet for 

bringing the conversation about these innovative partnerships to 

the Senate and to this committee with the Social Impact Partnership Act. You have a lot to cover today. 

I would say to our witnesses, we commend you for the breadth 

of expertise you bring to the conversation. We look forward to hearing from you. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Well, thank you, Senator Wyden. 

[The prepared statement of Senator Wyden appears in the appendix.] 

The CHAIRMAN. We have a very impressive group of individuals 

here today. I would like to thank each of you for coming and lending your expertise to us. 

First we will hear from Mr. Gordon Berlin. Mr. Berlin is the 

president of MDRC, a nonprofit, nonpartisan research organization 

based in New York City and Oakland, CA. The organization is 

dedicated to learning what works best to improve the lives of lowincome individuals. 

Before joining MDRC in 1990, Mr. Berlin was the Executive Deputy Administrator for Management, Budget, and Policy of the New 

York City Human Resources Administration. He has also served as 

the deputy director of the Ford Foundation’s Urban Poverty Program, and also worked as a program analyst and project officer in 

the U.S. Department of Labor’s Employment and Training Administration. 

Next, we will have the privilege of hearing from James Lee 

Sorenson. Mr. Sorenson is a world-renowned entrepreneur, business leader, societal innovator, philanthropist, and impact investor. 

Mr. Sorenson serves as president of the Sorenson Impact Foundation, which funds sustainable, scalable endeavors that maximize 

the positive impact on the lives and the societies they touch and 

have been very, very important. 

In 2012, Mr. Sorenson contributed $13 million to the University 

of Utah’s David Eccles School of Business for the creation of the 

Sorenson Impact Center, whose mission is to accelerate sustainable 

social change through the use of capital, innovation, data, and 

cross-sector collaboration. 

Mr. Sorenson has been instrumental in developing several new 

industry innovations through his private-sector work. This has included digital compression software that has helped usher in the 

online video revolution and video relay services that transformed 

opportunities for deaf and hard of hearing individuals. I am really 

proud of what he has been able to do. 

Our third witness will be Ms. Tesha Bright. Ms. Bright is a 

nurse home visitor with the Nurse-Family Partnership, referred to 

as NFP, of Essex County, NJ. 

For nearly 8 years, Ms. Bright has worked diligently to foster 

long-term success for low-income first-time moms, their babies, and 

the community at large by delivering the evidence-based NFP 

model of maternal health, child health and development, and 

breaking the cycle of poverty. 

Prior to becoming an NFP nurse, Ms. Bright worked as a medical 

surgical nurse with a neurology focus and as a pediatric home care 

6 

nurse, which she continues to do in order to maintain her clinical 

skills. 

Finally, we will hear from Robert Doar. Mr. Doar is the Morgridge Fellow in Poverty Studies at the American Enterprise Institute, or AEI, where he studies and evaluates how improved Federal 

policies and programs can reduce poverty and provide opportunities 

for vulnerable Americans. Specifically, Mr. Doar focuses on the employment, health, and well-being of low-income Americans and 

their children. 

Before joining AEI, he was Commissioner of New York City’s 

Human Resources Administration where he administered 12 public 

assistance programs. 

We will hear from the witnesses in the order they were introduced. So, Mr. Berlin, we will start with you. Please proceed with 

your opening statement, then we will go across the table. 

STATEMENT OF GORDON L. BERLIN, PRESIDENT, 

MDRC, NEW YORK, NY 

Mr. BERLIN. Thank you, Mr. Chairman. 

To ensure a positive rate of return for both taxpayers and beneficiaries on the billions of dollars invested in the Nation’s social 

education and health programs, Congress, first with the Bush administration and then with the Obama administration, has quietly 

forged a bipartisan consensus around the need to build evidence of 

effectiveness. The most recent example is the Evidence-Based Policymaking Commission. 

The commitment to evidence is paying off. We are beginning to 

learn what works. Now the challenge ahead is learning what works 

at scale and ensuring that Federal funds are spent on the evidencebased programs found to work. 

Perhaps the largest evidence-based program of the era is the Maternal, Infant, and Early Childhood Home Visiting program, which 

was largely crafted by this committee. As a model for future efforts, 

several elements of that law are worth emphasizing. 

Using a tiered funding structure, Federal funds can be spent only 

on home visiting programs that meet an evidence-based designation, making it much more likely that program funds would make 

a difference for families. And funds were set aside for research, including a rigorous national evaluation to ensure continuous learning and to enable States to test innovative new approaches. 

Congress has continued this focus on evidence in more recent legislation, including the Workforce Innovation and Opportunity Act 

and the Every Student Succeeds Act. Both laws contain provisions 

for the use of pay for success, a promising new vehicle for evidence 

building. The pending Social Impact Partnership Act would support 

States and localities in the use of social impact bonds to tackle an 

even wider range of social and public health challenges. 

As Congress seizes the initiative on evidence building, it can 

make the most of its investments in the following four ways. It can 

create a culture of continuous improvement. Rather than being focused on up or down judgments about programs or policies, government should focus on using research evidence to make programs 

more effective over time, changing direction only when continuous 

improvement does not yield expected results. 

7 

Secondly, it can bolster agency-directed research capacity while 

also supporting pay-for-success innovation. Both vehicles build evidence, but in different yet complementary ways. One is not a substitute for the other. The agency research model is preferable when 

the goal is to develop a reliable body of evidence about what works 

to address a persistent problem. 

The social impact bond or SIB model, with its focus on individual 

deals, is an excellent vehicle to encourage local innovation tied to 

strong evidence building and is a means of equipping local government with the tools to assess program effectiveness. 

Third, Congress can improve access to data for more efficient 

evaluations while still protecting confidentiality. The public sector 

collects a wealth of data that could be used to track progress and 

enhance performance, yet for privacy and other reasons, Federal 

and State agencies and their contractors are often not able to regularly access and share data for evaluation purposes. 

Fourth, we need to clarify Federal authority to conduct this kind 

of research. Inconsistencies in Federal authority to conduct independent research and evaluation as well as costly procurement, paperwork reduction, and other contracting rules are often obstacles 

to efficient evidence building. 

Turning to social impact bonds, the SIB vehicle is a valuable tool 

for stimulating experimentation, innovation, and the scaling of 

promising approaches at the State and local level, and the SIPA 

bill is an important step forward in the effort to support new deals. 

The Federal Government could enhance the value of SIBs as a 

learning-what-works tool by stating clearly that the goal is to build 

reliable evidence about what works and by supporting the evaluation costs of SIB projects only when they use rigorous research designs capable of reliably attributing causality. 

Secondly, government could signal its support for a benefit-cost 

perspective that places equal weight not solely on government 

budget savings, but also on economic returns to participants and 

society as a whole. 

Third, it could stimulate deals by supporting State and local payfor-success projects, but insist that State and local agencies—to the 

maximum extent possible—commit to sustaining programs that 

work after a SIB deal ends. 

And fourth, it could ensure transparency by requiring public release of evaluation results, the payment terms of deals, and final 

benefit-cost calculations including any lost savings that would result if a government did not continue to support effective initiatives. 

In conclusion, the bipartisan commitment to building evidence 

heralds better programs, more effective policies, and more responsible use of taxpayer dollars. But there is more to be done, including set-asides with funding streams to build evidence, continued 

use of tiered funding structures, and rewards for localities to move 

more of their formula funding into programs with evidence. 

Thank you very much. 

The CHAIRMAN. Thank you, sir. 

[The prepared statement of Mr. Berlin appears in the appendix.] 

The CHAIRMAN. Mr. Sorenson, let us take your testimony at this 

time. 

8 

STATEMENT OF JAMES LEE SORENSON, CHAIRMAN, BOARD 

OF DIRECTORS, SORENSON IMPACT FOUNDATION, SALT 

LAKE CITY, UT 

Mr. SORENSON. It is a pleasure and an honor to be with you 

today and discuss a matter of great importance to me, which is: 

how can we more effectively measure and direct social spending in 

this country to produce successful outcomes? 

I have been an entrepreneur for most of my life. During that 

time, I have been greatly blessed and, as a result of that, have decided to spend more of my time and efforts and financial resources 

in giving back. 

I was unsatisfied with traditional philanthropy in some respects 

in that, compared to the business world that I came from, it was 

inefficient, unaccountable, and really did not move the needle much 

in terms of solving the problems that we face with those who have 

needs. 

Four years ago, I endowed an academic center at the University 

of Utah’s Business School in order to help direct private and philanthropic capital to help solve some of the most perplexing social 

problems, both here in America and abroad, in more measureable 

and scalable ways. Now since its inception, the Sorenson Impact 

Center has facilitated over $100 million in funding to scalable, sustainable solutions to problems like chronic unemployment, criminal 

recidivism in the U.S., unsafe drinking water, access to health and 

education, and in rural areas, poverty alleviation. 

Over the past 2 years, the Center has also been engaged in structuring nearly a dozen pay-for-success or social impact financing 

projects around the country with a variety of stakeholders, including State and local governments, nonprofit organizations, academics, philanthropists, and other funders. 

These projects are aimed at addressing some of the most complex 

and challenging issues facing our society today, including 

intergenerational poverty, homelessness, foster care, mass incarceration, chronic unemployment, educational achievement gaps, mental illness, and substance use disorders, to name a few. But most 

importantly—and this is the key—they do it in a way that is more 

effective because they employ evidence-based practices that are correlated to measured outcomes. 

I would like to give just kind of a brief overview of how one of 

these pay-for-success projects works. 

It usually focuses—number one—on a social issue where a preventative intervention is less costly than the downstream treatment or chronic care. It is a permanent fix as opposed to a temporary stopgap. Pay for success also engages the private sector to 

provide the risk capital in the funding intervention, which enables 

more innovation and trial and error to be utilized. 

Number two, meaningful measured outcomes are central to pay 

for success—not activities, not the promise of outcomes, but actual 

achieved outcomes that are measured and validated. An example 

may be the number of homeless who obtain permanent housing, as 

opposed to those who may be off the streets but in a temporary 

shelter. 

Social investors, along with foundations and philanthropists, provide the up-front risk capital to fund the service providers that proVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 R:\DOCS\25244.000 TIMD
9 

vide the necessary interventions. You then have an independent 

evaluator that conducts a rigorous evaluation in order to determine 

whether the service produced specific, predetermined outcomes. 

Finally, if the predetermined outcomes are achieved and the 

project is successful as defined by all of the parties, which usually 

means that the payer is saving as much or more money than they 

would have otherwise, then and only then does the payer, which 

could be a government, a hospital, or whichever entity promised to 

pay back those who funded the interventions, only then do they 

pay back the initial funders. 

These projects are noteworthy for a number of reasons. They are 

focused on definitive, measurable indicators of success that are focused on outcomes. There is greater transparency and accountability. You learn what programs work, what programs do not work, 

and can allocate scarce resources to more effective funding. They 

also foster a competitive social services environment with a virtuous race to the top for nonprofits and other service providers to 

be impactful and have evidence-based programs that are eligible 

for the funding. 

Now, while the Federal Government has thus far played a role 

by encouraging this developing of pay-for-success initiatives, it has 

been conspicuously absent in one critical and important aspect. In 

many of the State and local projects, the lion’s share of the societal 

value and economic benefit generated actually accrues to the Federal Government, not the local budgets. We call this the ‘‘wrong 

pockets’’ problem, in industry terms, because there is effectively a 

mismatch between who gets asked to pay for the program and ultimately who stands to benefit the most from that program. 

This is why I am thankful to be here in support of this legislation that Chairman Hatch and Senator Bennet are introducing that 

addresses this issue by enabling government to pay for a portion 

of the project where the benefits are accrued by the Federal Government. This will enable these programs to be able to scale up, 

because State and local governments cannot, in most cases, tap 

Federal funding to pay for outcomes. 

What is remarkable about this model is the level of bipartisan 

support in State governments and city halls around the country. 

People from across the political spectrum agree that it makes sense 

to be more results-oriented, data-driven, and ultimately more accountable in the way we address social problems. 

Also, the level of bipartisan support is a tribute to the Senate bill 

itself, in that it is a bipartisan effort led by Senators Hatch and 

Bennet, and there are 41 cosponsors in the House. It is also supported by Chairman Ryan. 

In my experience as an impact investor—as one who is seeking 

for measurable, more effective ways to direct my philanthropy— 

evidence-based policies and pay-for-success financing really make 

great sense. They address the great social and health problems of 

society today in a way that produces successful outcomes. 

Thank you for this opportunity for me to offer my support for 

this legislation. 

The CHAIRMAN. Thank you, and we appreciate all of the efforts 

that you are putting forward, all of you. We are just very appreciative of all four of you here today. 

10 

[The prepared statement of Mr. Sorenson appears in the appendix.] 

The CHAIRMAN. Ms. Bright, we will take your testimony now. 

STATEMENT OF TESHA BRIGHT, NURSE HOME VISITOR, 

NURSE-FAMILY PARTNERSHIP OF ESSEX AND MORRIS 

COUNTIES, NEWARK, NJ 

Ms. BRIGHT. Good afternoon, Chairman Hatch, Ranking Member 

Wyden, and members of the committee. Thank you for the opportunity to testify on behalf of the Nurse-Family Partnership Program serving Essex and Morris Counties, NJ in support of the lifechanging potential of evidence-based programs like NFP. 

Additionally, on behalf of the mothers, children, and families 

served by the Nurse-Family Partnership, I want to thank this committee for its commitment to improving the health and well-being 

of at-risk families with dedicated funding for evidence-based home 

visiting programs. Your work is paving the way for healthier, 

brighter futures. 

I am Tesha Bright and have worked as an NFP nurse home visitor for nearly 8 years. As a nurse home visitor, I serve a regular 

caseload of 25 first-time, low-income mothers and families. 

A multitude of unfortunate factors in a community make NurseFamily Partnership a critical element of the counties’ continuum of 

services for prevention and families in need. Still, we only reach 

about 3 percent of the population who could benefit from our services. 

The Nurse-Family Partnership is a voluntary program that partners a pregnant woman and her first child living in poverty with 

a registered nurse who provides her with home visits beginning 

early in pregnancy until her child’s second birthday. 

Over that period of time, the nurse forms a trusted relationship 

with each mom that empowers her to have a healthy pregnancy, 

improve her child’s health and development, and set goals to 

achieve economic self-sufficiency. By achieving these program objectives, many of the major risks for poor health and social outcomes can be significantly reduced. 

Over these years, I have worked with hundreds of young parents, 

many involved with the New Jersey Department of Child Protection and Permanency. I have worked as part of the treatment team 

providing a variety of services for this population, but most importantly, my role is to provide consistency and structure as we plan 

and prepare for their first child. 

Working with this population is especially trying, given the extensive mental health backgrounds, lack of trust, transient lifestyles, and histories of sexual and drug abuse. Throughout each client’s involvement in NFP, she will experience many moments of 

success, but also many challenges. I am a constant partner through 

both of these periods. 

I think of one of my 15-year-old clients who, at the time, was living in a homeless shelter and was initially denied my services by 

shelter staff. They believed that this client would not be parenting 

her child, and that the baby would be placed in a foster home upon 

discharge from the hospital until family could be located. 

11 

Through persistence and a more flexible visitation schedule, I 

was able to not only begin seeing the client, but I was also able 

to deliver content in creative ways and encourage excitement about 

motherhood. 

I received a 3 a.m. call when she went into labor. Upon reaching 

the hospital, I discovered she was being treated without compassion. This experience had the potential to be quite traumatic for 

this teen, but by advocating for her and pulling staff aside, I ensured she was treated fairly. 

In the end, we delivered a healthy baby girl, and capturing those 

first photos of mom and baby were priceless. Breastfeeding was initiated at that time. Sadly, further arrangements were not made, 

and mom went home without her baby, but I worked with the client to visit her infant. Over that time, this client continued to 

pump and provide breastmilk for her baby. Our work encouraged 

a continued bond until both were united at a group home shelter. 

Another case involved pregnant sisters living in a foster home 

where lack of communication and cultural differences made the 

home a silent battleground of passive-aggressive behavior and disrespect. This example shows how my job is so much more than 

nursing duties. My training in motivational interviewing and family communication was instrumental in encouraging open communication and understanding between all parties, which afforded the 

development of chore charts and house rules agreed upon by all. 

I have learned many things over my years as a nurse home visitor that have helped me serve my clients better. I believe that the 

beauty of the model is meeting our clients where they are and 

building on their own desire to change their lives. 

NFP can help break the cycle of poverty by empowering young 

mothers to become knowledgeable parents who are able to confidently care for their children and guide them along a healthy life 

course. NFP nurses use a client-centered approach, which means 

the nurse is constantly adapting to the needs of the family, ensuring that each visit is relevant and valued by the parents. This can 

create positive, lasting change for the family that sustains long 

after our time as a nurse home visitor ends. 

NFP applauds Congress for their bipartisan, bicameral support 

for the MIECHV program and, in particular, this committee for 

your collective commitment to funding programs proven to work. 

We also believe that pay for success represents an opportunity for 

smart policy to incentivize the growth of evidence-based programs 

like Nurse-Family Partnership. 

The Nurse-Family Partnership thanks the committee for a continued interest in how evidence-based programs can improve the 

daily lives of people who need them most. I hope that the committee will continue to support and expand funding streams that 

promote evidence-based social programs. 

Thank you again, Chairman Hatch, Ranking Member Wyden, 

and members of the committee, for the opportunity to testify today. 

The CHAIRMAN. Well, thank you, Ms. Bright. 

[The prepared statement of Ms. Bright appears in the appendix.] 

The CHAIRMAN. Let us now finish with you, Mr. Doar. 

12 

STATEMENT OF ROBERT DOAR, FORMER COMMISSIONER, 

NEW YORK CITY HUMAN RESOURCES ADMINISTRATION, 

AND CURRENT MORGRIDGE FELLOW IN POVERTY STUDIES, 

AMERICAN ENTERPRISE INSTITUTE, WASHINGTON, DC 

Mr. DOAR. Thank you. Chairman Hatch and other distinguished 

members of the committee, thank you for the opportunity to testify 

today on how the use of evidence-based policy can improve our 

safety net and help low-income Americans move up. 

Evidence-based policymaking entails compiling strong evidence 

about what works and what does not, using administrative data 

systems more effectively, and ending failing programs while scaling 

up successful ones. 

During my 18 years administering State and local social safetynet programs, I have been a part of a number of efforts that modeled this approach. Today I would like to share some lessons 

learned in those experiences. 

In New York City, we performed rigorous evaluations of over 30 

new initiatives as part of Mayor Bloomberg’s Center for Economic 

Opportunity. One initiative in particular received a lot of attention, 

the first conditional cash transfer program in the developed world. 

The program, Family Rewards, provided cash payments to individuals who took positive actions like going to the doctor and ensuring their children regularly attended school. MDRC conducted 

the evaluation of the experiment. 

While participants saw lower poverty levels as a result of the 

program, most of the income gains came from the transfers themselves, and not from increased earnings. Once the program ended, 

the treatments group’s incomes were not substantially different 

from the control group. 

We were also disappointed to see that these incentives did not 

significantly change the behavior of participants in the vast majority of outcomes sought in the program. As a result of these findings, Mayor Bloomberg ended the program. 

Just as programs failing to show results must be ended, programs backed by rigorous evaluations should see more resources 

channeled their way. One idea that was the subject of rigorous 

evaluations and consistently delivered positive impact on outcomes 

was the Nurse-Family Partnership. 

Critically, the creators of the program conducted three randomized controlled trials in different places to evaluate the program 

and followed up with participants in the study regularly for decades. They found that it generated long-lasting benefits for both 

mothers and their children. 

Once the Nurse-Family Partnership model had developed this 

strong evidence base, it warranted being adopted on a larger scale. 

Mayor Bloomberg’s Center for Economic Opportunity made scaling 

up the program a priority. The program grew by 383 percent between 2007 and 2011, and our program made a significant impact. 

Children in the program are 16 percentage points more likely to 

be current with their immunizations at 24 months, and teenage 

mothers in the program are 15 percentage points more likely to obtain a high school diploma or GED. 

Similarly, pay-for-success models—also known as social impact 

bonds—allow innovative social programs to receive funding from 

13 

private investors, and, if they meet an agreed-on metric of success, 

only then will government compensate this initiative and its investors. This approach has tremendous potential, but will also come 

with administrative challenges, and has only been utilized in a 

handful of trials in the United States. 

Federal initiatives like the proposed Hatch-Bennet Social Impact 

Partnership Act are worth pursuing as they offer help to States 

and localities to manage such programs effectively. 

In order to build the evidence base around policy ideas, researchers need high-quality data, but there are inherent flaws in government survey data, our primary tool for collecting information about 

safety-net programs. Dr. Bruce Meyer of the University of Chicago 

has documented in several studies that misreporting of income and 

benefit receipt are common in surveys. 

In one recent study that matched State administrative records to 

Census Bureau survey data, he and a coauthor found that the Current Population Survey missed program receipt for 40 percent of 

SNAP recipients and 60 percent of TANF and general assistance 

recipients. 

Administrative data is important not only because it provides 

more accurate information, but also because it enables new ways 

of evaluating policies and practices. For instance, randomized controlled trials are expensive and time-consuming. After separating 

participants into treatment and control groups and administering 

the treatment, researchers must keep up with the recipients for 

years, tracking their life outcomes through surveys. 

In recent years, an alternative has emerged called low-cost RCTs, 

in which researchers can use existing administrative data already 

collected for other purposes as the basis for their evaluations. Administrative data is also key to a similar evidence-based policymaking technique: rapid-cycle evaluation. 

Rapid-cycle evaluation helps policymakers make tough decisions 

about the best way to implement programs and whether reforms 

and tweaks make sense. 

In New York City, we performed a number of rapid-cycle evaluations. We piloted a child support initiative that invited noncustodial parents to an initial meeting at the customer service center in 

hopes that we could increase the number of orders established by 

trying to reach an agreement in a friendlier environment than a 

courtroom. We tested incorporating different messages into the 

SNAP online education that behavioral economics evidence suggested would improve accuracy and honesty from applicants. 

While all policymakers believe their decisions are backed by evidence, evidence-based policymaking is about following a specific 

process. New and existing programs must be evaluated in a way 

that establishes impact over a counterfactual. 

Programs that rigorous evaluation show to be effective should be 

scaled up, while initiatives failing to have success must be phased 

out. Administrative data should be used to make it easier to conduct evaluations and to enable incremental improvements in program administration. 

Thank you. 

[The prepared statement of Mr. Doar appears in the appendix.] 

14 

The CHAIRMAN. Well, thanks to all four of you. I have a few questions here I would like to ask, and others as well may have questions. 

Mr. Sorenson, let me just start with you. I want to thank you so 

much for being here today and for the incredible work you are 

doing out there in Utah, my home State. 

There is no question in my mind you are truly an innovator and 

a thought leader in moving social impact financing forward. Now, 

you mentioned that you began the Sorenson Impact Center, in 

part, out of dissatisfaction with traditional philanthropy. Can you 

elaborate on that dissatisfaction, and how do you hope the Sorenson Impact Center could change, challenge, and help the field? 

Mr. SORENSON. First of all, I want to say that I think traditional 

philanthropy does really good things. I do not mean to in any way 

impugn what they do. I just feel that because there is not always 

a culture where measurement is involved and transparency in 

what they do, that it is not as effective as it could be. 

As one who is interested in really moving the needle in terms of 

solving problems, I think every dollar is a scarce resource, and I 

want to see it, in many cases, magnified, and, ultimately, I would 

like to see models that are more self-sustaining and scalable. 

So that is why I have been involved in what is called ‘‘impact investing;’’ that is, looking at the use of for-profit, as well as nonprofit business models that have a cash flow component to them, 

that help in the scalability and self-sustainability of the enterprise 

that addresses social problems. 

This is an area that is of real interest, now increasingly so, in 

the capital markets—impact investing, that is—investing in businesses that produce not only positive social benefits or address social problems, but also generate a financial return because they can 

become self-sustaining. They can also attract more capital in the 

capital markets than traditional philanthropy. 

So much of the work that is done at the Sorenson Impact Center 

is really focused on how to facilitate impact investing and how to 

educate those in the field and advocate for this new tool to help address the many problems that we face in society. 

The CHAIRMAN. Thank you. I appreciate the work that you are 

doing. I am very pleased that you support this bill, S. 1089, The 

Social Impact Partnership Act, which Senator Bennet and I introduced. 

You have testified that this legislation is needed, in part, to address what is referred to as the ‘‘wrong pocket’’ problem. Can you 

discuss the current implications for the States of this ‘‘wrong pocket’’ problem and how the Hatch-Bennet bill would ameliorate this 

problem? 

Mr. SORENSON. Yes. I think that the problems that we are addressing are fairly complex in terms of the different constituencies 

that bear the cost, particularly in the area of Medicaid, health care, 

for example. There could be an intervention that saves more money 

than it costs, but the beneficiary of that is the Federal Government 

as opposed to the State and local governments. 

So, by being able to engage in this legislation, to pay for that portion of the benefit that accrues to the Federal Government, it helps 

for the Federal Government to be able to underwrite these initiaVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 R:\DOCS\25244.000 TIMD
15 

tives, and that in turn helps them to really become more prevalent 

and scalable around the country. So it is a very important aspect 

to enable these to work, to be able to have the various constituencies that are benefitting involved. 

An example of this is, in the health-care area, a preventative 

intervention for asthma. Now asthma is a condition that has preventative interventions that will often prevent a much more costly 

care or acute situation that happens if people have to go to the hospital and you have emergency room visits and you have physicians 

involved in very expensive services. 

Well, Medicare covers the hospital part, and that is about 70 percent of the benefit in terms of cost savings, where State and local 

governments that would be expected to pay for the intervention are 

only getting 30 percent in that equation. 

So clearly this would enable, for this initiative, that portion of 

the savings that accrued to the Federal Government to be recovered in the pay-for-success formula. 

The CHAIRMAN. Well, thank you so much. Senator Bennet, let us 

turn to you. 

Senator BENNET. Thank you, Mr. Chairman, and thank you very 

much for your partnership on this bill and your leadership on this 

bill. You and your staff have made it much better. I am grateful 

for that. 

I am grateful for the testimony we had today. Particularly, I 

want to thank Ms. Bright for sharing with us the work she is doing 

with Nurse-Family Partnership. The Nurse-Family Partnership is 

headquartered in Denver, CO and is doing important work 

throughout the country. Its use of evidence-based intervention is a 

model for all public and private social service organizations. So, 

thank you. 

My interest in this began after I was in business, and then I 

found myself being superintendent of the Denver Public Schools 

and realizing that very few of the incentives or disincentives 

around that system were related to the outcomes that we wanted 

for kids. Now I am in the Federal Government and realize it is 

even worse when the funding source and the service provider are 

not the same entity, because it is even harder to figure out how to 

hold people accountable. 

These are the early days of this kind of work, but I wonder if— 

to me, it seems that this will rise or fall based on our ability to actually establish rigorous metrics for outcomes. The risk is that we 

will not establish those rigorous outcomes. I do not mean ‘‘we’’ the 

Federal Government; I mean the investors and others. 

I wonder—starting with you, Mr. Sorenson—based on your experience, if you could talk a little bit about that, how you set those 

rigorous outcomes so we really do get a felicitous race to the top 

as you described it, instead of the reverse. Then I might ask Mr. 

Berlin and Mr. Doar. 

Mr. SORENSON. I think that that is one of the important elements 

to this, and I would just say that I think, because there is engagement and collaboration from the social scientist, as well as the 

service providers, as well as the governments, as well as investors, 

that there is a level of rigor and a framework for the potential for 

much greater scrutiny in terms of the evidence and the outcomes 

16 

and the validation that ultimately define how these will run and 

be assessed. In the case of the first pay-for-success project in this 

country—on Rikers Island in New York City—it was determined 

that is was not successful. 

The government did not pay. The investors ultimately ended up 

taking the loss, and we learned what did not work in the process. 

Senator BENNET. Is there anybody else who would like to get in 

on this? 

Mr. BERLIN. I think this is the central question. The promise 

that government will only pay for success depends entirely on the 

metrics that we use, but also on the evaluation designs that we 

use. 

It is easy to get improvements in outcomes, for example, by 

changing who participates or whom you recruit into the program. 

So it is important to think through how to ensure that you are actually getting the effects that you promised, above and beyond 

what might have happened otherwise. 

So I think combining the right metrics together with the right 

kind of research design to give you a sense about the net value 

added is really essential. Otherwise, government could end up paying for things that did not really make a difference at all. 

Mr. DOAR. I agree with Gordon. The key thing is to be sure that 

you set up a structure so that you make sure that the outcome 

would not have happened otherwise without the intervention. That 

is an impact evaluation, and it takes a certain rigor. 

The other is defining what success is. I think in the example that 

I gave, it was important to the city to have human capital development and self-sufficiency as opposed to just an income effect. I 

think that, as we work through this, we have to define that early 

as we go into it. 

Senator BENNET. I only have 1 minute left for a second question. 

Mr. Sorenson, I will start with you again. Could you explain to the 

committee what level of interest there is in the private sector 

around this? Is it developing? Is it growing? Who are going to be 

the investors in this world, do you think? 

Mr. SORENSON. Well, I think that is an interesting question for 

me, because I came to this from the investment world, the impact 

investment world, where I was looking at potential investments 

that had a double bottom-line potential, and I was contacted by my 

wealth manager at Merrill Lynch with the first one that I got involved in and saw right off the bat the potential for this. It captured my imagination and interest because it was data-driven, it 

was much more accountable, and it was really based on outcomes— 

all of the issues that I faced as a philanthropist wanting to find 

better ways to deploy my capital. 

Now having said that, I think there are other investors—outside 

of philanthropy—who are also very interested in this model. We see 

within the Sorenson Impact Center about a dozen of these that are 

in the early stages of being set up in the western United States, 

and there are another 50 across the country. So we are seeing really, I think, not only an interest by investors, but by communities 

in setting these up and structuring them and moving forward in 

the issue areas that are really important. 

17 

Senator BENNET. Thank you. I am out of time. I thank the chairman, again, for his partnership. 

The CHAIRMAN. Thank you. I appreciate all of the effort you are 

putting forward. 

Senator Wyden? 

Senator WYDEN. Thank you, Mr. Chairman. Just one question, if 

I might, for you, Mr. Doar, and you, Mr. Berlin. 

Obviously, right at the heart of an effective strategy is to figure 

out what is going to work best, particularly for folks like TANF clients who are unemployed or are looking for better jobs. They face 

barriers to employment. What do you believe are the best measures 

now to be considered in terms of trying to help these disadvantaged 

populations find and hold jobs? Why don’t we hear from Mr. Berlin 

and Mr. Doar? 

Mr. BERLIN. Thank you. In terms of measures, I think we really 

want to see increases in employment and earnings so that people 

can be self-sufficient and really move forward. 

I feel like we are getting a little too pessimistic. There is a really 

long history of the Welfare-to-Work experiments that were undertaken in California and many other places. Eventually all of the 

States did it under the various welfare reforms in 1988 and again 

in 1996, in which we invested in mixed strategies that provided job 

search assistance for those who were employable, but also education and training for those who needed to develop their skills. 

We saw pretty substantial increases in employment and earnings 

and income, and also some savings in welfare. In addition, what we 

call the Making Work Pay experiments really made sure that when 

low-income people went to work, they were truly better off. They 

also produced pretty dramatic increases in employment and earnings, but also benefits for their children. They did better in school. 

Senator WYDEN. Now, I understand that you all are advocating 

some sort of inventory for information that you think is most promising to help these youngsters. What do you do with the information and the inventory? Where does it go? How does it work? 

Mr. BERLIN. So, when we build evidence about programs that 

work, the challenge is really to make sure that that evidence gets 

used at the local level. So one process is to create these ‘‘what 

works clearinghouses’’ that begin to pull together all of the information that we have about what is working. Another part of the 

process which we work hard at at MDRC is working with localities 

to help them actually use that evidence to move things forward. 

Senator WYDEN. So if I was explaining this at a town hall meeting, what I would say is that I can use this inventory to find programs that seem particularly promising in terms of earnings and 

employment, and those kinds of opportunities that really lend 

themselves to being replicated elsewhere. Is that something resembling English that I could convey? 

Mr. BERLIN. That would work. We are building a body of evidence that I think, pretty convincingly, demonstrates in each of 

these categories—for welfare recipients, for TANF recipients, for 

disadvantaged youth—that we are beginning to see really clear evidence about the kinds of strategies that work. 

We are further behind for youth, but there are a number of models that have been promising. We just released results not too long 

18 

ago on a program for young people maturing out of foster care— 

youth villages—which showed some positive gain for them in terms 

of their mental health, less likelihood of being homeless, and we 

have several others like that that are in the pipeline. 

Senator WYDEN. Thank you, Mr. Chairman. 

The CHAIRMAN. Senator Warner? 

Senator WARNER. Well, thank you, Mr. Chairman. I want to 

thank you and Senator Bennet for your interest in this subject. I 

simply want to make the point that this is an area that I have 

enormous interest in, and I commend all of the panelists. 

A couple of comments, and a couple of questions. One, I think it 

is important that we get the rigor, but I also think it is important 

that we do not spend another decade trying to perfect the models. 

There will be gaming, there will be mistakes. But when we are 

thinking about pay for performance, for example in job training, 

there are pretty easy metrics. 

Did you get a job? Did it pay? Did you stay in that job for a period of time? 

The social value that we can add—I sometimes worry that we try 

to set so many different metric posts along the way that we study 

forever, as opposed to trying, trying new programs, trying what actually works, and then rewarding it in a meaningful way. 

I think Mr. Sorenson has been too generous sometimes with his 

comments about philanthropy. I think at times philanthropy has 

been reluctant to put its money where its mouth is. They want to 

one-off programs, but actually having programs that are incented 

based upon pay for performance or social impact bonds—I think we 

really need to be more aggressive. 

Mr. Chairman, there are a series of things—if we are going to 

get serious in this area—that we could do. For example, the DOL 

recently changed part of their regulations for ERISA-managed 

funds around fiduciary duty. For a long time we had a fiduciary 

duty definition that said that if you are a State pension fund or a 

private pension fund that wanted to do the right thing, you could 

not make these social double bottom-line investments if they did 

not show the same EPS on a short-term basis that I think a lot 

of our investment strategies are plagued with. 

A lot of the social double bottom-line investments require maybe 

a slightly longer time horizon than a quarter-to-quarter-based investment change. There was a change by DOL that said ERISAmanaged funds can now look beyond simply EPS, and they can include the workers, and they can include other factors, and we 

ought to accelerate that. 

I think one of things we talked about in the past is many of 

the—I am going to want your comments on this—philanthropic 

funds are restricted in their ability to make project-related investments with their own corpus. So you will have some of the big philanthropic funds around that are brand names that are unable to 

invest in programs that are social double bottom-line-based because 

of, frankly, an arcane, backward-looking regulatory environment. 

Now on a bolder basis, if we were to look at portions of the capital gains rate based upon longer-term holds in this field to get that 

social double bottom line, it might take a 3- or 5-year time horizon, 

not a 1-year time horizon. We could incent, through usages of the 

19 

tax code, much greater experimentation in this field. But we are 

going to need to be, quite honestly, thinking about a capitalism 

that works for a broader group of people. I think your whole sector 

of investing here offers enormous comment. 

I know I have laid out a lot of points there, but I would like any 

of you, but particularly Mr. Sorenson, if you want to start with 

those, and any of the others who want to comment. 

Mr. SORENSON. I think there are a lot of really great thoughts 

that you put forth there. First of all, let me just say that the whole 

area of impact investing—or in the foundation world it is often referred to as mission-related investing—is really capturing the 

minds and the imaginations of the investment world, and I think 

creating a tremendous opportunity to address problems and benefit 

society that has a much greater potential than I think has ever 

been thought. 

Senator WARNER. There are regulations now that preclude—— 

Mr. SORENSON. There are regulations. You talked a little bit 

about program-related investments in the foundation world. 

Program-related investments are investments that foundations can 

make—and they typically are made at the very early stage, the 

high-risk experimental stage—where commercial capital does not 

typically make investment because of the risk factor. 

It is a good place for philanthropic foundation money, but because of the ambiguity in the tax code, many foundations do not 

participate with program-related investments because they are concerned about whether or not they would qualify by IRS definition. 

If there were a way to remove that ambiguity—and we have ideas 

that would really be helpful in that regard—I think it would help 

to really provide a much more welcoming environment for foundations as it relates to program-related investments and looking at 

investing in more scalable self-sustaining solutions. 

Mr. DOAR. I would just say that it is not just government that 

needs to apply evidence-based policymaking to their interventions. 

The not-for-profit world also could benefit from being more rigorous 

in evaluating their impact. 

My friend, Professor Sullivan at Notre Dame, has set up a lab. 

He is partnering with not-for-profits around the country to bring 

that kind of rigor to that world. It is very much needed. 

So the extent to which this legislation or this discussion sets an 

example for that world to be as rigorous about impact as we need 

to be is a good thing. 

The CHAIRMAN. All right. Senator Scott? 

Senator SCOTT. Thank you, Mr. Chairman, and thank you to the 

panelists. Senator Warner, I look forward to getting my legislation 

over to your office as soon as possible. 

Literally what you were talking about is my new legislation 

which is investing in opportunity, which allows for a deferral of the 

capital gains tax beyond 1 year in an attempt to give investors an 

opportunity to make good decisions about how to invest the resources necessary to grow entrepreneurs in some of the distressed 

communities around the country. 

It would be central from my perspective for us to continue to 

work together to find those opportunities to encourage the private 

sector to do what the private sector would prefer to do, which is 

20 

have that capital reinvested in communities that desperately need 

the resources, as opposed to paying a higher and higher capital 

gains tax. 

But this only defers the capital gains tax. It does not eliminate 

it. So we, the government, would see the resources coming back to 

the government, but it would give a window of opportunity for 

those dollars to be redeployed into the communities that have the 

greatest need. Fifty million Americans around the country in all 50 

States would benefit from the legislation. I will ask Mr. Doar to 

talk about that in a few minutes. 

One of the things I appreciate about this hearing so much is that 

we have so many Americans who are suffering, who are working 

very hard, and find themselves unable to crawl out of the pit of 

poverty. We have scarce resources to be used effectively to help 

these Americans. 

One of the things I find exciting and encouraging about this 

hearing is that we are trying to figure out how to have measurable 

progress in a reasonable time, how to fuse together the private sector and the public sector to joint venture in these communities and 

help the very people who have grown up or who are growing up in 

very similar fashion or similar places that I did when I was a kid, 

growing up in poverty. 

So I am encouraged that we are having a conversation that needs 

to be had, that perhaps, looking at some of the programs and the 

overhead expense within the government, we should have had a 

very long time ago. 

I remember serving on a nonprofit board of directors about 15 

years ago in South Carolina. We stopped funding agencies and organizations and we started funding specific programs within those 

agencies and organizations that could provide the outcome that we 

were looking for. 

I think that approach is just common sense, and while we are 

having a hearing on it, I certainly hope that most of us recognize 

that this really should have been the model that we were using for 

a very, very long time, because the very people who need the help 

the most are the people who seem to be stuck and still suffering 

because of the lack of outcome focus. 

Mr. Doar, since the focus of today’s hearing is on delivering social 

services and support to vulnerable families, I wanted to raise the 

issue of how we actually change the economic ecosystem of distressed communities. In addition to more effective delivery of social 

services, I believe that we must do more to spark economic conditions necessary to provide real economic opportunities in these 

communities, which is why I was talking about the Investing in 

Opportunity Act. 

I am curious to know how you would characterize the need for 

greater investment and access to capital in struggling communities, 

and whether those issues should be prioritized alongside the issues 

we are discussing today. Do you believe we are effectively engaging 

the private sector towards this goal, and what could we do better? 

Mr. DOAR. Well, I certainly believe that economic development 

and economic stimulation are very much a part of an anti-poverty 

effort, and people in social services who forget that a stimulated 

21 

economy providing jobs is wind at your back in helping low-income 

Americans are making a mistake. 

So efforts that would bring that kind of greater economic activity, 

through legislation like you are proposing, if they are evaluated 

carefully and monitored carefully, are much needed. 

The other thing that is coming out a lot in the recent data is the 

extent to which poverty is often place-based. There are distressed 

communities where there are high concentrations of poverty. We do 

have to turn our attention to those specific communities and give 

them greater attention, as opposed to broad-based solutions that 

attempt to cover the whole country. 

So I think that efforts to stimulate jobs and economics are very 

much a part of an anti-poverty effort. I also think that lessons that 

are in this hearing about the importance of doing very rigorous 

evaluations are important too. 

Senator SCOTT. I am running out of time. Mr. Chairman, if you 

would allow for one more question? Thank you, sir. 

Mr. Sorenson, my Governor in South Carolina, Governor Nikki 

Haley, announced in February of this year a $30-million expansion 

of the Nurse-Family Partnership program in South Carolina, the 

Nation’s first pay-for-success initiative focused on improving the 

lives and health outcomes of mothers and children living in poverty. More than half of the expansion will be paid for by private 

donors, included an $8-million gift from the Duke Endowment. 

Nurse-Family Partnership has a lot of data and evidence that 

demonstrates their ability to produce successful outcomes for 

women and children living in poverty. Because of this, Governor 

Haley could feel confident about expanding the Nurse-Family Partnership in South Carolina through a pay-for-success initiative. 

Can you talk about the importance of evaluating programs based 

on the outcomes instead of just the money that we are putting into 

those programs, and can you also speak to the importance of 

leveraging private capital to invest in programs that could supplement or even replace government social programs—with a lower 

overhead expense from my perspective? 

Mr. SORENSON. Well I think, as we have talked about today, 

there are a lot of social services and funding for social services that 

are not measured or focused on outcomes or looking at accountability that focuses on a result that ends up potentially saving 

money. The potential for the type of delivery and procurement that 

we are talking about here, in evidence-based procurement for social 

services, is being able to develop models that determine, first of all, 

those metrics that measure successful outcomes and then being 

able to develop a framework and structure that rigorously measures them. That, I think, is pretty basic. 

If I am in a business in the business world, that seems very intuitive to me. Yes, it is not as common a practice as it should be in 

the procurement of social services. 

I think the other really innovative thing in what we are doing 

here is really engaging the private sector in the collaborative involvement between investors who take risks and the efficiency that 

is in the business world in measuring and underwriting investments and bringing that to bear in this structure. I think that that 

enables, really, solutions to problems that are difficult for State 

22 

and local governments to address because their resources are 

scarce and they are really focused on the downstream costs as opposed to innovative interventions, preventative interventions that 

could ultimately save a lot more than what they cost. 

That is really the whole, I think, opportunity for the private investors, whether they be foundations or other investors, to really 

engage. 

Senator SCOTT. Thank you. 

The CHAIRMAN. Senator Menendez? 

Senator MENENDEZ. Thank you, Mr. Chairman. 

Let me first start off by thanking my fellow New Jersian, Tesha 

Bright, for coming to testify before the committee today. It is always a privilege to hear from a constituent, and I read your testimony. I was at another event, but I read your testimony, and I appreciate what you had to say, especially in a program that I have 

long championed, which is home visiting. 

Nobody knows the needs of the families in Essex and Morris 

Counties, especially the young at-risk families that you work with, 

more than I do. I want to commend you and the work that the 

Nurse-Family Partnership is able to accomplish on behalf of the 

families you serve. 

When we talk about evidence-based successes, this is one, Mr. 

Chairman. It is because of the needs facing these communities and 

communities like them all over the country that I have been such 

a strong supporter of home visiting programs like the Maternal, Infant, and Early Childhood Home Visiting programs. 

Because these are evidence-based programs, we know exactly 

how successful they have been at helping families by reducing infant mortality, improving language development, reducing child 

abuse and neglect, enhancing parental engagement, and even decreasing children’s exposure to the juvenile justice system during 

adolescence years after the home visits have stopped. That is a 

pretty good track record, Mr. Chairman. 

I want to take the opportunity to thank my colleague from Iowa, 

Senator Grassley. I know he could not be here. Together he and I 

have been able to ensure that the MIECHV program has been extended and the funding continues to flow to these programs, because they work. 

I want to thank him for his commitment and continuing to work 

with me to ensure that the program’s funding, which is currently 

set to expire at the end of fiscal year 2017, is again continued and, 

as my hope is, expanded to ensure that more home visits can occur, 

more mothers have the opportunity to learn from nurses like 

Tesha, and more children are able to benefit from the evidencebased practices that have already proven so successful. 

So thank you for joining us today. As you know, I think it is always great for the members of Congress to hear firsthand accounts 

about how the policies we discuss in this committee actually translate to work on the ground, people back at home. Sometimes there 

is a bit of a disconnect there. I always like to bring it back to home. 

In your written testimony, you talk about a couple of memorable 

clients with whom you worked, a teenage mother and a pair of sisters in a foster home. I am hoping you can describe for us how the 

training for this particular model helped you connect with them, 

23 

and how your interactions might have differed compared to nonevidence-based models. 

Ms. BRIGHT. Well, I can only speak to this evidence-based model. 

The training that I received, like I mentioned, the motivational 

interviewing, was painful at times, going through this training, 

learning not to give our opinion, but to encourage our clients to 

make up their own minds, just to restate and rephrase, encourage 

them to solve their own problems just by listening, and encourage 

them to talk. 

The communication, family communication that I mentioned in 

the testimony—we have facilitators that we use in our program, 

and it is at the nurse’s discretion when you need to bring them out. 

I think that having done them so many times over the last 8 years, 

when I noticed that this incident was going on in the family, just 

sitting everyone down and having them air their grievances and 

discuss everything was very important for the foster mother who 

really could not connect with the two Haitian sisters, and then just 

getting their voice out because they felt that they had to do everything on their own and they had no one to help them. Because they 

trusted me, it helped to facilitate that between the sisters and the 

mother. 

In that instance, I think that the training I received with the motivational interviewing through the Nurse-Family Partnership was 

really important. 

Senator MENENDEZ. So in these 8 years that you have been 

working at this, would you say there are successes in the families 

that you have dealt with that, but for your participation and that 

of the program, might not have been achieved? 

Ms. BRIGHT. I am not going to say I can come in and change a 

family, but I could definitely make them think about different 

things. 

A good example would be nutrition. If I see that the majority of 

the family is overweight and I am discussing nutrition and healthy 

eating with the mom of the toddler, I can be creative with it and 

bring in smoothies, and bring in a blender and show them how you 

can make smoothies and use vegetables so that your child is getting fresh vegetables, using the WIC checks to buy fresh vegetables 

from the local farmers’ market and then using those vegetables, 

and then just encouraging them to try one new thing every month, 

and bringing something new. I think that impacts the whole family. Just small change is all we are looking for. 

Senator MENENDEZ. Small changes sometimes bring big results, 

Mr. Chairman. 

Thank you very much. Thank you for coming. 

The CHAIRMAN. Senator Scott has one more question he would 

like to ask, and then we are going to recess. 

Senator SCOTT. Thank you, Senator Hatch. 

Ms. Bright, just a quick question. In South Carolina, the NurseFamily Partnership serves about 1,200 families currently. With the 

new initiative, we will be able to serve another 3,200 families. 

My question really is on building a new culture because, from my 

perspective, it appears to me that once you have an impact on a 

family, that family has an impact on their community. If you have 

enough folks receiving assistance and projecting forward, you will 

24 

have an opportunity really to have a new culture within a community. 

Can you talk to the ability to impact families outside of the specific family that is being served? 

Ms. BRIGHT. Yes. I have a great example of that. I have a client—well, I had a client. She has graduated now. Working with 

her, I was able to work with the mom, give her different job opportunities that came through our e-mail system, visiting with her, 

not just in her home, but meeting her at a baby shower and going 

to her graduation. I was able to meet the grandmother and then 

the aunts. 

I do a lot more than just nursing. I find that—I made a deal with 

her: if you graduate, I will drive for your prom. It was just our 

basic family car, but I was able to drive her to her prom, and just 

being involved with that family—multi-generational—made a difference. It made a difference. 

It is funny. Many of the times, they do not know my first name. 

They just know me as ‘‘the nurse.’’ They refer to whatever I say 

as, ‘‘Well, the nurse said.’’ 

That makes a difference, because it is not just my client saying 

that, it is her mom or her grandmother referring to something that 

I mentioned. It could be just as simple as healthy eating. 

Senator SCOTT. That is awesome. Thank you very much. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator Scott. 

We are very grateful for your testimony here today. This is serious stuff. We intend to pass this bill. The House is working on 

their version as well. Hopefully before the end of this year, we can 

work out a bill that you all will be very satisfied with. If we do, 

it will be in large measure because of you taking the time to come 

and see us today. 

With that, let me just say that I would ask that any questions 

for the record be submitted by Tuesday, May 24th. 

With that, then, I think we will just adjourn this hearing. I think 

I am going to see you a little later, Mr. Sorenson. 

Thank you all for being here. I really appreciate you. 

[Whereupon, at 3:30 p.m., the hearing was concluded.] 

(25) 

A P P E N D I X 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF GORDON L. BERLIN, PRESIDENT, MDRC 

USING EVIDENCE AS THE DRIVER OF POLICY CHANGE: THE NEXT STEPS IN SUPPORTING

INNOVATION, CONTINUOUS IMPROVEMENT, AND ACCOUNTABILITY

Good morning, Chairman Hatch, Ranking Member Wyden, and members of the 

committee. I appreciate the opportunity to participate in this hearing on the role 

of evidence-building in the future design and evolution of the Nation’s education and 

social welfare policies and programs. 

My name is Gordon Berlin, and I am president of MDRC, a nonprofit, nonpartisan 

education and social policy research organization that is dedicated to learning what 

works to improve policies and programs that affect the poor. Founded in 1974, 

MDRC evaluates existing programs and develops new solutions to some of the Nation’s most pressing social problems, using rigorous random assignment research designs or near equivalents to assess their impact. 

The Federal Government spends billions of dollars on policies and programs designed to improve the human condition; ameliorate poverty; increase employment, 

earnings, and income; invest in education to build human capital; and ensure America’s competitive position in a technologically advancing world. But to make a real 

difference, to ensure a return on investment for both taxpayers and the beneficiaries 

of these programs, we have to do things that actually work. 

Over the last decade and a half, during a period defined in the public consciousness by political partisanship, the legislative and executive branches have quietly 

forged a bipartisan consensus around the need to build evidence of effectiveness that 

would ensure high rates of return on investment for the Nation’s social programs. 

The establishment by Congress of the new Evidence-Based Policymaking Commission is only the most recent example of this consensus. 

In my testimony today, I offer a brief history of the Federal Government’s fruitful 

investment in evidence-building; then concentrate on several of the most recent efforts, including supporting pay-for-success initiatives; and conclude by identifying 

obstacles to effective evidence-building, offering potential solutions and suggesting 

a framework for exploiting the opportunities that lie ahead. 

A Brief History of Evidence-Building 

The history of evidence-building has evolved through four phases: in the 1980s 

and 1990s, Federal waivers made the States the engine of innovation; in the early 

2000s, the Office of Management and Budget drove the Federal agencies to focus 

on developing rigorous evidence, and the Congress created the Institute of Education Sciences; in the late 2000s, the Federal Government built partnerships with 

the nonprofit and philanthropic communities and defined tiered standards of evidence; and today Congress has taken the lead, building on the earlier phases to create new evidence-building frameworks and pay-for-success initiatives that seek to 

support innovation and stronger results. 

Putting States in the Lead: The Waiver Era. The earliest roots of the evidence 

evolution can be traced to the 1980s and 1990s when the Nation turned to the 

States as laboratories of innovation. Using the Social Security Act’s 1115 waiver authority, the Federal Government allowed States to experiment with new approaches 

to welfare policy. In return, States were expected to subject their programs to rigorous evaluation, nearly always using random assignment, to demonstrate that the 

26 

reforms had the intended effects and were cost neutral. The Federal Administration 

for Children and Families and its Office of Planning, Research and Evaluation 

(OPRE) played a key role in managing the waiver process and organizing that research—as well as in setting the agenda in subsequent years for advancing our understanding of the contributions job search, training, and community work experience could make. The remarkable body of evidence built during this period provided 

the backbone for passage of the 1988 Family Support Act and the 1996 welfare reform law. No one understands the results of that work better than the members of 

this committee: together with a strong economy, the resulting welfare-to-work programs and related supports embodied in Federal law led to an unprecedented increase in employment rates among welfare recipients and a sharp decline in the Nation’s welfare rolls. I turn later in this testimony to some of the challenges associated with the waiver authority in health and welfare policy broadly and the current 

state of the Temporary Assistance for Needy Families program specifically. 

Creating Capacity: The Era of Investment in Federal Research Centers. 

With OPRE’s rich body of research evidence on welfare as one example, the Office 

of Management and Budget in the Bush administration began encouraging all Federal agencies to use randomized controlled trials to evaluate the effectiveness of the 

programs they funded. In 2002, Congress passed the Education Sciences Reform 

Act, which created the Institute of Education Sciences (IES), the independent statistics, research, and evaluation arm of the U.S. Department of Education. IES has 

been universally recognized for raising the standards of evidence in education research. In 2008, recognizing that States had little incentive to allocate dollars to 

programs with the strongest evidence, President Bush and Congress appropriated 

$10 million to support States that committed to scale up evidence-based home visiting programs. This bipartisan action laid the groundwork for the next era in 

evidence-based policy. 

Partnering With the Nonprofit Sector: The Era of Tiered Evidence. During 

the third phase in the late 2000s, Congress capitalized on innovation and creativity 

in the nonprofit sector in legislation that created the Investing in Innovation Fund 

($650 million) at the U.S. Department of Education, the Workforce Innovation Fund 

($125 million) at the U.S. Department of Labor, the Teen Pregnancy Prevention Program ($110 million) at the U.S. Department of Health and Human Services (DHHS), 

and the Social Innovation Fund ($50 million) at the Corporation for National and 

Community Service. Each of these funding streams employed ‘‘tiered’’ evidence 

structures that allotted the largest dollar amounts to the programs with the strongest evidence, each encouraged new program development, each emphasized taking 

what works to scale, and, importantly, each required that additional evidence be 

generated as programs expanded. Programs funded by these streams include such 

effective interventions as the Success for All school model, the Reading Partners volunteer tutoring program, the Youth Villages YVLifeSetprogram for young people 

transitioning out of foster care, and the transitional employment program for reentering prisoners run by the Center for Employment Opportunities. 

Perhaps the largest evidence-based program of the era is the Maternal, Infant, 

and Early Childhood Home Visiting (MIECHV) program, which provided $1.5 billion 

in funding for home visiting programs over 5 years. In many respects, MIECHV, 

which was largely crafted by this committee, was a model of building and using evidence to shape policy. The authorizing legislation reflected the considerable amount 

of research that had already been conducted on home visiting in two ways. First, 

it required DHHS to establish transparent criteria to determine which models of 

home visiting had prior evidence of effectiveness. It then required States to spend 

the majority of their MIECHV funds on those models. 

Recognizing that prior studies had also shown gaps in where home visiting was 

effective, the legislation also encouraged States to innovate by allowing part of the 

funds to be used for promising approaches to home visiting. For example, home visiting programs have historically not had large effects on maternal mental health, 

so states could use these funds to pay for new services to try to ameliorate maternal 

depression. At the same time, the authorizing legislation recognized a need for continued learning about the effects of home visiting. To that end, it specified that 3 

percent of the budget should be spent on technical assistance and research activities. Finally, the legislation also required a national evaluation of the MIECHV program, noting that random assignment designs were to be used ‘‘to the maximum extent feasible.’’ 

In sum, there are several elements of MIECHV worth emphasizing: 

27 

• Prior evidence was used to influence how Federal funds could be spent, making it more likely that the funds would make a difference for families. 

• The legislation recognized that there were areas where home visiting was not 

as effective as desired and offered States funds to test innovative approaches. 

• Funds were set aside for research to make sure that learning continued under 

MIECHV and could influence future realizations of home visiting. 

Together these initiatives laid the groundwork for the modern era of evidencebuilding that Congress has now embarked upon. 

Today: Using Evidence as a Driver of Change. Building on past efforts, this 

Congress is actively using evidence as an instrument of change—setting aside a 

small fraction of funding for evidence-building, charging the executive branch with 

using tiered strategies that privilege those programs and models with the best evidence with the highest levels of funding, and requiring that States look to evidencebased models as they expand federally funded programs. In addition, recognizing 

that context matters, these set-asides include funding for innovation in the private 

and nonprofit sectors and also in States and localities. 

Indeed, social impact bond financing—a strategy that brings together privatesector capital, nonprofit know-how, and government urgency in a partnership designed to take promising new approaches to scale—is an important part of the 

Workforce Innovation and Opportunity Act of 2014 (WIOA) and the Every Student 

Succeeds Act of 2015 (ESSA). 

WIOA places new emphasis on evidence-based decision-making by asking States 

and the U.S. Department of Labor (DOL) to identify, evaluate, and share promising 

and proven practices. In addition, DOL is charged with establishing a robust program of research to fill crucial knowledge gaps, including learning what works to 

help disconnected youth return to school and enroll in postsecondary training and 

conducting regular and rigorous evaluation of programs for dislocated workers and 

of the Job Corps. States are required to evaluate their programs annually using rigorous methods, and the law sets aside dollars for Governors to encourage experimentation at the State and local level. Surprisingly, the law doesn’t employ the 

tiered evidence strategies pioneered in other bills. The law also created new authority for local workforce investment boards to use up to 10 percent of funds across 

all three formula grant programs—Adult, Youth, and Dislocated Workers—to support pay-for-performance or social impact bond projects. As we begin to learn more 

about what works, emphasis should turn to ensuring that this evidence is used in 

the design and delivery of local workforce programs: 

• A tiered evidence strategy could be employed to signal the value of developing 

new approaches, testing promising programs at some scale, and expanding 

programs with the strongest evidence. 

• State and local workforce agencies should work with the Department of Labor 

to build the data systems necessary to support both better performance management and evidence-building. 

• As a complement to the mandatory sanctions that current law imposes when 

States fail to meet performance goals, create funding streams that reward 

performance improvement and the use of evidence-based programming. 

• To encourage innovation and evidence-building, Governors should use a portion of WIOA discretionary dollars to co-fund with DOL a series of workforce 

innovation laboratories to experiment with new approaches. 

The Every Student Succeeds Act (ESSA) allows States to use some of their title 

I, part D, and title IV, part A, funds to support pay-for-performance initiatives as 

long as they also conduct a rigorous third-party evaluation to determine if the 

project actually worked. ESSA also provides a clear definition of evidence modeled 

after the Investing in Innovation (i3) tiers of evidence. It requires low-performing 

schools to use evidence-based interventions and sets aside 7 percent of title I funds 

so that States can pay for them. ESSA also clearly values the development and evaluation of innovations in education by codifying a tiered approach in the Education 

Innovation Research Grants Program, which replaces the i3 program, and by allowing the Institute of Education Sciences to pool money set aside for evaluations of 

individual programs. But several key features in the new law could also be improved: 

• School districts should be offered incentives to choose the interventions that 

have the strongest evidence. 

28 

• The law’s definition of evidence includes correlational studies, which are 

weaker than experiments, and could end up supporting unsubstantiated interventions. • Substantial discretion is left to the States in gauging evidence quality but 

without a strong framework or support; therefore, application of evidence is 

likely to be uneven and too easily overridden by political and other considerations. • A clearer connection should be established between the evidence built by IES 

and summarized in its What Works Clearinghouse and what constitutes reliable evidence at the State level, where officials are charged with deciding 

what ‘‘evidence-based’’ will mean. 

In addition, the separate Social Impact Partnership Act (S. 1089) would authorize $300 million to support States and localities in the use of social impact bonds (SIBs) 

to tackle social and public health challenges—of which $10 million is allocated for 

feasibility studies, $45 million for evaluations, and the remaining funds to support 

deals and pay for administrative costs. The purpose is to spur State and local experimentation, build better evidence about what works, and foster the bundling of 

philanthropic, private investment, and public funds to scale effective social programs operated by nonprofit organizations and local governments. To promote wider 

use of this new vehicle, Federal funds can be used to support project costs—essentially allowing the Treasury Department to be a financing party in SIB deals, providing dollars to State and local entities so that they may in turn pay back investors 

if an initiative is found to be effective by a rigorous third-party evaluation. While 

the bill admirably specifies a comprehensive list of acceptable project outcomes, that 

list does not include pre-k or college outcomes, two promising areas for pay-forsuccess investing. 

Lessons From Experience on Social Impact Bonds 

Social impact bonds—or pay-for-success initiatives—are attractive across the political spectrum as they bring together the concepts of lending for a social purpose, 

return on investment, and payment based on performance. In the simplest terms, 

a SIB uses private funds to pay for a social, educational, or health program, and 

the government repays investors (plus a return) only if the program achieves 

prespecified results. A SIB can be a valuable new tool in the evidence-building 

movement. A financing mechanism for testing and scaling innovative new approaches to complex social problems, it provides important flexibility to State and 

local authorities, who might not otherwise have the resources to experiment with 

new approaches. This is a valuable complement to the broader agency-based Federal 

role that should be retained as the centerpiece of future evidence-based policymaking. 

At MDRC, we have first-hand experience with social impact bonds, having served 

as the intermediary at the center of the first SIB initiative in the United States, 

which financed the Adolescent Behavioral Learning Experience (ABLE) program at 

Rikers Island in New York City. It was designed to learn whether a cognitive behavioral therapy program delivered to all 16- to 18-year-old adolescents awaiting trial 

at Rikers Island jail would equip them with the social and decision-making skills 

to help take responsibility for their actions, avoid rash and impulsive reactions, 

make more constructive life choices, and ultimately avoid a costly return to Rikers. 

The Rikers SIB sought to answer two distinct questions, each of which should be 

judged independently. The first was: did the program reduce recidivism? The short 

answer is no; ABLE was discontinued after 3 years when results from an independent evaluation by the Vera Institute of Justice demonstrated that it was not 

meeting its goal of reducing recidivism among 16- to 18-year-olds. The second question was: Is a social impact bond a viable mechanism for financing, testing, and 

scaling a social program innovation? Here the answer is clearly yes. Government got 

to try something it would not otherwise have attempted, while investors assumed 

all of the risk. 

But, as Rikers proved, SIB funding does not guarantee programmatic success. A 

SIB-supported program that turns out not to work can result in losses for investors, 

no cost savings for the government, no opportunity for long-term growth for nonprofit service deliverers, and limited benefits for participants. Yet while the intervention may not have worked, the SIB structure did succeed: the government did 

not pay for ineffective services, but learning what didn’t work may have helped 

point the way to what might. 

As early adopters like us gain real-world operating experience, the reality of SIBs 

is turning out to be more nuanced than either proponents or detractors have promVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00032 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
29 

ised. As I argue in Learning From Experience: A Guide to Social Impact Investing, 

emerging lessons from Rikers and other deals reveal both SIBs’ value to government 

entities and also the reality that this value will only be realized if the tensions inherent in structuring the terms of a SIB deal can be addressed squarely. These include: 

• The balance of risk and reward. The returns governments are able to pay 

may not be proportional to the risks some lenders are able to take. • The focus on narrowly defined government savings. Many deals still depend on the possibility of government savings. But insisting on government 

savings can unnecessarily rule out projects that might otherwise offer valuable and readily quantifiable returns to participants and society at large. • The role of evidence. SIBs reduce risk for government entities by promising 

that they will have to pay only for successful interventions. To fulfill that 

promise, a SIB must include independent, rigorous evaluation of a program’s 

effectiveness over the status quo—a requirement that poses a new form of investor risk. Unfortunately, efforts to mitigate that risk have driven some SIB 

deals to rely instead on simple outcome measures, which may misleadingly 

provide only the illusion of benefits and savings to government entities. 

What does that mean for Congress moving forward on pay-for-success? The SIB 

vehicle is a valuable tool for stimulating experimentation, innovation, and the scaling of promising approaches at the State and local level. But it is not a substitute 

for a comprehensive agency-directed research agenda, which is essential if evidence 

is to be harnessed effectively to improve performance. The Federal Government can 

enhance the value of SIBs as a ‘‘learning what works’’ tool by: 

• Stating clearly that the goal is to build evidence about what works. 

• Signaling its support for a benefit-cost perspective that places equal weight 

on quantifiable government budget savings, benefits for participants, and benefits for society as a whole. 

• Supporting the evaluation costs of SIB projects only when they use rigorous 

research designs capable of reliably attributing causality, requiring those 

studies to collect a range of relevant outcome measures (not just the single 

measure that payback would be based upon), and insisting that those measures be quantifiable measures of success. 

• Stimulating deals by supporting State and local pay-for-success projects in 

the form of backend payments as specified in the Social Impact Partnership 

Act, WIOA, and the Social Innovation Fund Classic competitions, but giving 

broad latitude to dealmakers (public agencies, investors, and nonprofit service 

providers) by not being overly prescriptive about the requirements governing 

a SIB deal—in essence, allowing the private market aspects of SIBs to work, 

while still insisting on rigorous evidence and payment terms that are fair to 

both taxpayers and investors. 

• Sustaining what works by requiring, to the extent possible, that State and 

local agencies continue supporting effective programs after a SIB deal ends. 

• Insuring transparency by requiring that public agencies using Federal funds 

must release publicly the final results of evaluations, the payment terms of 

deals, and final benefit/cost calculations, including the lost savings that 

would result if the government did not continue to support effective initiatives. 

Looking Forward: The Future of Evidence-Building 

The Federal investment in evidence over the past two decades has yielded great 

benefits in our understanding of what works in education, workforce development, 

health and human services, and housing policy. As this evidence base continues to 

grow, however, we must address a number of challenges to make the most of what 

we are learning by: (1) creating a culture of continuous improvement with incentives 

for using research evidence to make programs even more effective; (2) balancing the 

role of agency-directed research with pay-for-success innovation in the States and 

localities; (3) making better use of Federal waiver authority; (4) improving access 

to data for more efficient evaluations, while protecting confidentiality; and (5) clarifying Federal authority to conduct research. 

Continuous Improvement Instead of Up-or-Down Judgments. Historically, 

we have failed to build a reliable record of what has worked and what has not, 

dooming ourselves to constantly repeating past mistakes and relearning the same 

lessons over and over again. With its actions in the last decade or so, Congress has 

taken decisive steps to build that record and to drive policy and funding with evidence. 

30 

But to be successful, consensus will also be needed around means and ends. Is 

the goal simply to fund what works and end what does not? Or is it to invest in 

continuously improving the Nation’s social programs? Those who are skeptical of the 

efficacy of social programs question whether we will really act on evidence when 

programs do not work. On the other side, supporters of social programs worry that 

evidence will be used as a blunt instrument to justify diminishing the Nation’s investment in ameliorating social problems. Both sides have a point. 

To take just one example: in the early 1990s, the national evaluation of the Job 

Training Partnership Act’s youth employment programs found few effects for youth, 

and Congress moved decisively to defund all of the Act’s youth training and employment programs. The discontinuation of Federal summer youth employment funding 

closed down one of the Nation’s largest employers of young people; funding for training programs was also terminated, and even the Job Corps experienced reductions. 

But no research and development investments were made in their stead to learn 

what might work better. Twenty years later, the Nation is in the midst of the worst 

youth unemployment crisis in recent history. Fortunately, Congress has built a 

learning agenda about youth employment in the recently passed WIOA, but many 

years and lives were wasted in the interim. 

Eventually, we do have to say no when efforts to enhance a given approach repeatedly fail to produce evidence of effectiveness. But that doesn’t mean doing nothing when the problems remain pressing. In short, the evidence-building agenda 

should be framed around long-term goals, and the tactics should focus on the means 

to that end. Like a business committed to becoming a dynamic learning organization, government should commit to continuous improvement and focus on making 

its programs more effective over time. The Edna McConnell Clark Foundation, one 

of the first (and largest) Social Innovation Fund intermediaries, offers an excellent 

example of building evidence and using it to continuously improve the programmatic 

and organizational capacity of its youth-serving grantees. 

Bolstering Agency Research Capacity and Supporting Pay-for-Success Innovation. In recent legislation, support for evidence-building, especially as it relates to innovation and scaling, has taken two forms: (1) traditional research and 

demonstration funding that charges the research arms of Federal agencies with 

building bodies of evidence about what works; and (2) social impact bonds or payfor-success structures that attract private funding for innovation. 

While both vehicles will build evidence, they approach the task differently, with 

each having advantages and disadvantages. Simply put, the agency research model 

is preferable when the goal is to learn what works for a broad and persistent problem like the transition from foster care, where one wants to develop a reliable body 

of evidence, one study building on the last. Agencies should be charged with creating a portfolio of research about a problem’s underlying causes and to test a range 

of possible solutions, always answering three questions: what difference did the program make, how did it do so, and why? To support that work, Congress could authorize Federal agencies to set aside at least 1 percent of existing program funds 

for evaluation, a solution that is budget-neutral. And because context matters, agencies should also be encouraged to pay attention to the systems in which programs 

operate—something Federal agencies too seldom do. It is not enough to learn what 

works; introducing what works into broader systems and maintaining quality at 

scale is the next frontier in evidence-based policymaking. 

The SIB model is best used when the goal is to encourage local experimentation 

and innovation and as a means of ensuring local buy-in. Its principal disadvantages 

are the narrow focus on a single outcome measure to determine success and the difficulty of packaging a deal that adequately balances risk against reward and that 

satisfies both investors and government payers. 

The Role of Waivers. Unlike the story of the welfare waivers in the 1980s and 

1990s, the use of waiver authority in health and health care offers a cautionary tale. 

As documented by the Government Accountability Office in 1995, 2002, and 2008, 

States have used 1115 waiver authority to experiment with new service delivery 

models, eligibility rules, and other strategies with the goal of improving outcomes 

and patient experiences and lowering costs in the Nation’s Medicaid program. While 

the waiver process unleashed an exceptional amount of State experimentation, little 

evidence was generated because there was no requirement that rigorous evaluations 

be conducted of the innovations. The Center for Medicare and Medicaid Innovation 

created as part of the Affordable Care Act is now hard at work attempting to more 

rigorously build that evidence base. 

31 

Ironically, we now face the very same problem in welfare policy. The waiver structure that spurred experimentation and nourished evidence-building no longer exists, 

even though we face a next generation of problems—incomes have stagnated, child 

poverty rates remain alarmingly high, and the fraction of families with neither 

earnings nor government-provided benefits has increased. We need to refine our understanding about how to promote job advancement and retention; how to understand the role of public employment during severe economic downturns and in 

urban, rural, and tribal areas where unemployment is perennially high; how to 

serve those with severe, persistent, and multiple employment barriers; and how best 

to engage with noncustodial fathers who owe child support and are unemployed. Initially, the block grant structure of TANF and the surpluses States enjoyed as a welcome by-product of the remarkable economic expansion of the late 1990s fueled a 

new round of State-led innovation. But the economic slowdown and States’ reluctance to commit State funding to new endeavors have limited the amount of experimentation in a number of critical areas. An annual set-aside of program dollars that 

States could apply for on a matching basis to pay for pilot tests of new ideas—tests 

that include requirements for rigorous, independent evaluations—is needed. 

Improving Access to Federal Data for More Efficient Evaluations. In evaluating the effectiveness of social programs, researchers need ready access to administrative data. Research firms that are funded by Federal agencies to evaluate programs often rely on data collected by States from employers on employment and 

earnings, for example, data that the States already report to the Federal Government for certain child support enforcement and other purposes. These data are 

housed in accessible form at the Federal level within the National Directory of New 

Hires (NDNH) database. However, research contractors face severe restrictions in 

accessing this essential database for assessing whether federally supported programs actually work. Instead, they are forced to get the very same data directly 

from the States, at great cost to the Federal Government and at considerable burden in duplicative reporting for the States. If the NDNH database were made more 

widely available to evaluators (with appropriate privacy safeguards), it would enable 

Congress and the Federal agencies to assess the impact that social programs have 

on jobs and earnings at much less cost and burden to the Federal Government and 

the States. 

Similar opportunities exist for building robust data systems from the wealth of 

data about individuals’ experiences with the health care, public assistance, criminal 

justice, child welfare, school, and college systems. Integrated data systems would 

save time and money and reduce paperwork burdens in the conduct of evaluations, 

while providing comprehensive information about program effectiveness over time. 

The American Opportunity Study being overseen by a committee of the National 

Academies of Sciences, Engineering, and Medicine and housed at the U.S. Census 

Bureau in a secure data environment would take an important step in that direction. Private industry is far ahead of the public sector—exploiting big data to understand customer desires, track trends, and assess performance, so that lowperforming business units can learn from high-performing ones. The public sector 

has the data to build comparable integrated systems to track progress longitudinally 

and to enhance program performance, yet Federal and States agencies (and their 

contractors) cannot regularly access and share data for evaluation purposes. We can 

do better. Agencies and their contractors need clear authority to access and link administrative data for evaluation purposes when it is housed at the Federal level and 

similarly clear authority when it is housed at the State level. Government efficiency 

hangs in the balance. 

Protecting Confidentiality. At all levels and branches of government, there is 

a tug of war between those who are focused on improving program effectiveness and 

those who are concerned with protecting privacy. Staff responsible for managing 

data are rightly charged with keeping it secure and protecting privacy but too seldom with developing protocols for sharing it securely with other agencies and evaluators. Although the stakes are high and the opportunity significant, the program 

office that houses the data often have little or no interaction with the same agency’s 

evaluation office. If these two objectives—measuring program effectiveness and safeguarding privacy—remain mutually exclusive, continued paralysis is the inevitable 

result. 

The Family Education Rights and Privacy Act (FERPA) illustrates the challenge. 

Congress is considering amending FERPA because of concerns over threats to the 

privacy of student data, and meanwhile State legislatures have stepped in. Just last 

year 47 State legislatures introduced over 180 bills to address student data protection issues, a reaction originally prompted by public outcry over educational techVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00035 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
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nology vendors and their use of children’s information for advertising and commercial gain. Unfortunately, education researchers from academia and other nonprofit 

institutions have gotten swept up in the furor. Under current Federal law, education 

agencies can share data with researchers only for research projects to benefit students and improve instruction—and only under extremely strict privacy conditions. 

But some are suggesting that Congress should significantly scale back even that authority. Without access to student data, little education research could be conducted 

at all. The bottom line is that it’s essential to continue to protect the security and 

privacy of student data, but we must be careful to not unintentionally end the analysis of student data for its original purpose: assessing and improving education. 

To strike the right balance between protecting privacy and confidentiality while 

still allowing access for research, Congress could start by specifying required levels 

of encryption and protection using the highest standards established by the National Institute of Standards and Technology (NIST). The NIST standards are appropriate for research data that must be kept confidential to protect the privacy and 

well-being of study participants. 

Clarifying Federal Authority to Conduct Research. Inconsistencies in Federal authority to conduct independent research and evaluation as well as procurement and contracting rules pose additional hurdles for efficient evidence-building. 

To guide policy, research must be independent, objective, and reliable. However, the 

authorizing legislation establishing agency research departments does not always 

set forth these requirements—for example, the law governing the Institute of Education Sciences does while the one over the Office of Planning, Research and Evaluation at DHHS does not. When authority is clear, agencies and their contractors 

have less difficulty accessing data, recruiting sites, establishing data-sharing agreements, and getting local buy-in. For example, in our experience studying home visiting programs, we found States and localities willing and ready partners in a random assignment research design when legislation instructed the Federal agency to 

make program funding contingent upon participation in the evaluation. In a complementary home visiting study that was not explicitly described by Congress, however, site recruitment proved difficult. 

Procurement and process obstacles to cost-effective evaluations should also be addressed. While its goals are laudable, the Paperwork Reduction Act’s requirements 

for clearance by the Office of Management and Budget and for filing two public notices for every survey involving more than 10 people add time and money to fielding 

studies. Rules designed to improve government procurement of goods and services 

can create havoc in evaluation research—for instance, an 18-month follow-up survey 

may span fiscal years and the pace at which the survey will be fielded is difficult 

to predict, but the funding of that survey can’t cross fiscal years. Research, demonstration, and evaluation projects are not readily severable. Given the need for 

long follow-up periods, studies may spread over 5 or more years. Under current procurement rules, contract requirements and dollar amounts for each year must be 

specified separately. This has dramatically increased costs to administer and manage research. 

Conclusion 

The bipartisan commitment to building evidence by Congress has created a new 

generation of innovation in education and social policy—better programs, more effective policies, more responsible use of taxpayer dollars. But there is more to be done. 

It is not enough to identify isolated examples of what works. We need to build a 

culture of continuous improvement and accountability, always striving to learn more 

and to more effectively direct funding at all levels of government to those programs 

with the strongest evidence. 

Thank you for the opportunity to testify today. 

PREPARED STATEMENT OF TESHA BRIGHT, NURSE HOME VISITOR, 

NURSE-FAMILY PARTNERSHIP OF ESSEX AND MORRIS COUNTIES

Good morning, Chairman Hatch, Ranking Member Wyden, and members of the 

committee. Thank you for the opportunity to testify on behalf of the Nurse-Family 

Partnership (NFP) program serving Essex and Morris Counties New Jersey in support of the life-changing potential of evidence-based programs like NFP. Additionally, on behalf of the mothers, children, and families served by Nurse-Family Partnership, I want to thank Chairman Hatch and this committee for their commitment 

to improving the health and well-being of at-risk families with dedicated funding for 

33 

evidence-based home visiting programs. Your work is paving the way for a 

healthier, brighter future for at-risk children and families. 

I am Tesha Bright, and I have worked as an NFP Nurse Home Visitor for nearly 

8 years. As a nurse home visitor, I serve a regular caseload of 25 first-time, low 

income mothers and their families. In those 8 years, I have experienced several 

meaningful examples of how this innovative program can empower young mothers 

to succeed. 

Every year, approximately 800,000 first time, low-income mothers become pregnant with their first child. Nationwide, the NFP model has served over 239,000 families since replication began in 1996, and currently has over 31,000 first-time families enrolled in 43 States, 6 tribes, and 1 territory (USVI). We believe that the national replication of our program is dramatically improving lives of vulnerable families and yielding significant returns to society by more stable and productive families. For every 100,000 families served by NFP, research demonstrates that 14,000 

fewer children will be hospitalized for injuries in their first 2 years of life; 300 fewer 

infants will die in their first year of life; 11,000 fewer children will develop language 

delays by age 2; 23,000 fewer children will suffer child abuse and neglect in their 

first 15 years of life; and 22,000 fewer children will be arrested and enter the criminal justice system through their first 15 years of life, among other outcomes. 

In New Jersey, NFP is part of the State’s Home Visiting Initiative led by a joint 

effort of the Department of Health (DOH) and the Department of Children and 

Families (DCF). The first program was established in Trenton, NJ in 2002 and 

today, 9 agencies have a capacity to serve approximately 1,500 families in all 21 

counties across the State. My implementing agency, the Institute of Infant and Preschool Mental Health, serves Essex and Morris Counties, which includes the city of 

Newark. We currently serve about 187 moms, and were recently able to expand to 

serve an additional 50 moms with the help of Federal Maternal, Infant, and Early 

Childhood Home Visiting (MIECHV) funding. A multitude of unfortunate factors in 

the community make Nurse-Family Partnership a critical element of the county’s 

continuum of services for prevention and families in need. Still, we only reach about 

3% of the population who could benefit from our services. 

NFP is a voluntary program that provides regular home visits to first-time, lowincome mothers by registered nurses beginning early in pregnancy and continuing 

through the child’s second year of life. The program is free and voluntary to the 

women that enroll. The children and families NFP serves are young, living in poverty, and at the highest risk of experiencing significant health, educational and employment disparities that have a lasting impact on their lives, their families, and 

communities. Nationally, 28 percent of families served by Nurse-Family Partnership 

are Hispanic; 29 percent are African-American; 24 percent are Caucasian; 5 percent 

are Native American or Alaskan Native; and 2 percent are Asian/Pacific Islander 

(the remainder declined to identify). 

NFP nurses and their clients make a 21⁄2 year commitment to one another, and 

develop a strong relationship over the course of 64 planned visits that focus on the 

strengths of the young mother and on her personal health, quality of care giving, 

and life course development. Their partnership with families is designed to help 

them achieve three major goals: (1) improve pregnancy outcomes; (2) improve child 

health and development; and (3) improve parents’ economic self-sufficiency. By 

achieving these program objectives, many of the major risks for poor health and social outcomes can be significantly reduced. 

In addition to our clinical training as registered nurses, NFP nurses are trained 

in a variety of developmental concepts and assessments. NFP nurses use Partners 

in Parenting Education (PIPE) lessons to teach clients a variety of concepts such 

as attachment, bonding, early language, and the importance of reading and literacy. 

We also perform continual assessments of the child’s growth and development and 

use tools such as the Ages and Stages Questionnaire (ASQ) at prescribed times help 

influence visit content and activities. By addressing deficits discovered through regular contact and use of the evaluative tools, nurses are able to instruct clients in 

a variety of ways such as floor play, demos with a doll, videos, handouts, and then 

finally, if necessary, a referral to early intervention. Lastly, using the NFP 

Strengths and Risks (STAR) framework we regularly access a variety of client risk 

factors and changes in areas such as personal health, home safety, unsafe family/ 

friend network, and economic adversity. It helps us serve clients better, maintaining 

engagement with NFP and the visit schedule. 

34 

Over the past 8 years as a Nurse Home Visitor, I have worked with hundreds of 

young parents, many involved with the New Jersey Department of Child Protection 

and Permanency, formerly the division of Youth and Family Services (DYFS). I have 

worked as part of the treatment team providing a variety services for this population, but most importantly, my role is to provide consistency and structure as we 

plan and prepare for their first child. Working with this population is especially trying given the extensive mental health backgrounds, lack of trust, transient lifestyles, and histories of sexual and drug abuse. Throughout each client’s involvement 

in NFP, she will experience many moments of success, but also many challenges. 

I am a constant partner through both of these periods. 

I think of one of my 15-year old clients who, at the time, was living in a homeless 

shelter and was initially denied my services by shelter staff. They believed that this 

client would not be parenting her infant, and that the baby would be placed in a 

foster home upon discharge from the hospital until family could be located. Through 

persistence and a more flexible visitation schedule, I was able to not only begin seeing the client, but I was also able to deliver content in creative ways and encourage 

excitement about motherhood. 

I received a 3 a.m. call when she went into labor. Upon reaching the hospital, I 

discovered she was being treated without compassion. This experience had the potential to be quite traumatic for this teen but by advocating for her and pulling staff 

aside, I ensured she was treated fairly. In the end, we delivered a healthy baby girl, 

and capturing those first photos of mom and baby were priceless. Breastfeeding was 

initiated at that time. Sadly, further arrangements were not made and mom went 

home without her baby, but I worked with the client to visit her infant. Over that 

time, this client continued to pump and provide breastmilk for the baby and our 

work encouraged a continued bond until both were united at a shelter/group home. 

Another case involved pregnant sisters living in a foster home where lack of communication and cultural differences made the home a ‘‘silent battleground’’ fraught 

with passive-aggressive behavior and disrespect. This example shows how my job is 

so much more than ‘‘nursing’’ duties. My training in motivational interviewing and 

family communication was instrumental in encouraging open communication and 

understanding between all parties, which afforded the development of chore charts 

and house rules agreed upon by all. 

I have learned many things over my years as a nurse home visitor that have 

helped me serve my clients better. I believe that the beauty of the model is meeting 

our clients where they are and building on their own desire to change their lives. 

When needed, flexibility of not only a visit schedule and location, but also the ability 

to check-in via text, encourages continuity of care during a very important time in 

a teen’s life. I also believe that sustained involvement of family members and fathers during visits is very important to the Nurse-Client relationship. 

One of the biggest challenges I have identified when working with my teen population is maintaining participation when mom is not quite on board or feels that the 

program will be intrusive and/or has no value. By identifying this obstacle during 

intake, I try to defer to mom’s own role as parent—emphasizing her strengths and 

encouraging her to share home remedies and beliefs. This type of conversation goes 

a long way in developing trust between the nurse and client. Additionally, spending 

time with the family doing creative activities (like making green smoothies or homemade baby food) helps to encourage participation in a more relaxed manner while 

also attempting to make small changes in the families food choices and health practices. 

These stories are just a glimpse of the impact that Nurse-Family Partnership has 

on low-income, first-time parents. NFP can help break the cycle of poverty by empowering young mothers to become knowledgeable parents who are able to confidently care for their children and guide them along a healthy life course. NFP 

nurses use a client-centered approach, which means the nurse is constantly adapting to the needs of the family, ensuring that each visit is relevant and valued by 

the parent(s). These client-centered principles drive our practice with families to create positive, lasting change for the family that sustains long after our time as their 

nurse home visitor has ended. These principles include: 

• The client is the expert on her own life. When the client is the expert, you 

build solutions based on information provided by the client on what’s relevant 

and valued to her. 

35 

• Follow the client’s heart’s desire. The client leads the way and the central 

focus is on what the client wants. Find out what they want to do and help 

them do it. • Focus on strengths. By focusing on capabilities, opportunities and successes, 

while being aware of risk factors, you can support the client through tough 

situations and encourage them to move forward, in turn, helping them to develop this strength within themselves that can sustain long after my visits 

are completed. • Focus on solutions. • Only a small change is necessary. The experience of one small success builds 

self-efficacy and causes a ripple effect in other areas of functioning and creates a context for bigger changes. 

NFP nurses also continue to monitor the model’s progress in the field through 

data collection, which nurses submit to the national database, and receive quarterly 

and annual reports evaluating the local program’s ability to achieve sizeable, sustained outcomes. Each NFP implementing agency’s goal is not only to improve the 

lives of first-time families, but also replicate the nurse home visitation model that 

was proven to work through rigorous research. 

NFP is an evidence-based program with multi-generational outcomes that have 

been demonstrated in three randomized, controlled trials that were conducted in 

urban and rural locations with Caucasian, African-American and Hispanic families. 

A randomized, controlled trial is the most rigorous research method for measuring 

the effectiveness of an intervention because it uses a ‘‘control group’’ of individuals 

with whom to compare outcomes to the group who received a specified intervention. 

The NFP model has been tested for over 38 years through ongoing research, development, and evaluation activities conducted by Dr. David L. Olds, founder of the 

NFP model and Director of the Prevention Research Center for Family and Child 

Health (PRC) at the University of Colorado in Denver. 

Dr. Olds and his research team have conducted three randomized, controlled 

trials with diverse populations in Elmira, NY (1977), Memphis, TN (1987), and Denver, CO (1994). Evidence from one or more of these trials demonstrates powerful 

outcomes including the following (in connection to each of NFP’s program goals): 

Improved pregnancy outcomes 

• Reductions in high-risk pregnancies as a result of greater intervals between 

first and subsequent births, including a 28-month greater interval between 

the birth of first and second child: 

Æ 31% fewer closely spaced (<6 months) subsequent pregnancies, Æ 23% reduction in subsequent pregnancies by child age 2, and Æ 32% reduction in subsequent pregnancies for the mother at child age 15 

(among low-income, unmarried group); • 79% reduction in preterm delivery among women who smoked; and • 35% fewer hypertensive disorders during pregnancy. 

Improved child health and development 

• 39% fewer injuries among children (among low-resource group); • 56% reduction in emergency room visits for accidents and poisonings; • 48% reduction in child abuse and neglect; • 50% reduction in language delays of child age 21 months; • 67% reduction in behavioral and intellectual problems at child age 6; • 26% improvement in math and reading achievement test scores for grades 1– 

3; • 59% reduction in arrests at child age 15; and • 90% reduction in adjudication as PINS (person in need of supervision) for incorrigible behavior. 

Increased family self-sufficiency 

• 61% fewer arrests of mothers at child age 15; • 72% fewer convictions of mothers at child age 15; • 20% reduction in welfare use; • 46% increase in father presence in household; and • 83% increase in labor force participation of mothers at child age 4. 

As the NFP model has moved from science to practice, great emphasis has been 

placed on building the necessary infrastructure to ensure quality and fidelity to the 

research model during the replication process nationwide. In addition to intensive 

education and planned activities for nurses to conduct in the home, NFP has a 

unique data collection system called Efforts-to-Outcomes (ETO) that helps NFP 

36 

monitor program implementation and outcomes achieved. It also provides continuous quality improvement data that can help guide local practices and monitor staff 

performance. NFP’s ETO system was designed specifically to record family characteristics, needs, services provided, and progress towards accomplishing NFP program goals. 

NFP’s replication plan reflects a proactive, state-based growth strategy that maximizes fidelity to the program model and ensures consistent program outcomes. NFP 

urges Congress to support a wide range of home visitation models that meet the 

highest level of evidentiary standards in order to ensure the largest possible economic return on investment. NFP applauds Congress for their bipartisan, bi-cameral 

support for the MIECHV program and in particular, this committee for your collective commitment to funding programs proven to work through rigorous, scientific 

evidence and research. 

In addition, NFP strongly supports Pay for Success as way to bring our program 

to more moms and babies. We recently launched our first Pay for Success project 

in South Carolina, which will expand NFP services to an additional 3,200 families 

statewide over the next 4 years. Thirteen million dollars of the $30 million project 

is funded by a 1915(b) Medicaid waiver, which was awarded to South Carolina by 

the Centers for Medicare and Medicaid Services. The remaining $17 million is supported by philanthropic investors. South Carolina will make up to $7.5 million in 

success payments to sustain our services in South Carolina only if the independent 

evaluator, J–PAL of North America, finds positive results. The pilot for this project 

launched in January and we had a successful full launch last month. 

We believe that Pay for Success represents an opportunity for smart policy to 

incentivize the growth of evidence-based programs. For that reason, we firmly support S. 1089, the Social Impact Partnerships Act (SIPA), sponsored by Mr. Chairman and Senator Bennet of Colorado, as well as its House companion, H.R. 1336. 

Amongst several provisions, this bill would create a new 10-year, $300 million fund 

to support State and local pay for success projects. Federal financial support for 

Federal savings achieved through State PFS projects is critical, and these bills provide critical Federal incentives to support smart State policies. For NFP, this part 

of SIPA is particularly important since Dr. Ted Miller’s analysis of NFP outcomes 

across 39 evaluation reports project that 65% of NFP savings accrue to Medicaid 

(explained in further detail below). Without Federal support for NFP PFS projects, 

States are required to pay back investors for all of the Federal Medicaid and other 

savings achieved. Absent SIPA, South Carolina was able to build the PFS project 

on the foundation of the 1915(b) waiver, which made it possible to leverage Federal 

financial support through that vehicle. 

Independent evaluations have found that investments in NFP lead to significant 

returns to society and government (Washington State Institute for Public Policy, 

2004 and 2008; 3 RAND Corporation studies 1998, 2005, 2008; Blueprints for Violence Prevention, Office of Juvenile Justice and Delinquency Prevention; and Pacific 

Institute for Research and Evaluation). Blueprints identified NFP as 1 of 11 prevention and intervention programs out of 650 evaluated nationwide that met the highest standard of program effectiveness in reducing adolescent violent crime, aggression, delinquency, and substance abuse. The RAND and Washington State reports 

weighed the costs and benefits of NFP and concluded that the program produces significant benefits for children and their parents, and demonstrated a savings to government in lower costs for health care, child protection, education, criminal justice, 

mental health, government assistance and higher taxes paid by employed parents. 

Most recently, the Pacific Institute for Research and Evaluation released a study in 

August 2015 which found significant government savings from the NFP model in 

particular, Medicaid and health care cost savings. This study projects that NFP will 

reduce Medicaid spending per child by 8.5% from birth to age 18, leading to $1.4 

billion in total savings for the 177,517 children served by operational programs from 

1996–2013. The study also projects that NFP will reduce estimated spending on 

Temporary Assistance by Needy Families (TANF) and food stamps by $3 billion 

(present value in 2010 dollars). By comparison NFP costs $1.6 billion to serve those 

children and their families. 

The Nurse-Family Partnership thanks the committee for your continued interest 

in harnessing the ability of evidence-based programs to improve the daily lives of 

people who need it most. Programs like NFP improve a host of conditions that 

hinder children and families from becoming healthy, thriving in school and achieving economic success, and smart implementation and expansion can save scarce taxpayer resources and produce tangible results. I hope that the committee will conVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00040 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
37 

tinue to support and expand funding streams that promote evidence-based social 

programs. Thank you again, Chairman Hatch, Ranking Member Wyden, and members of the committee, for the opportunity to testify today. 

PREPARED STATEMENT OF ROBERT DOAR, FORMER COMMISSIONER, NEW YORK CITY

HUMAN RESOURCES ADMINISTRATION, AND CURRENT MORGRIDGE FELLOW IN POVERTY STUDIES, AMERICAN ENTERPRISE INSTITUTE

The American Enterprise Institute for Public Policy Research (AEI) is a nonpartisan, nonprofit, 501(c)(3) educational organization and does not take institutional positions on any issues. 

The views expressed in this testimony are those of the author. 

FOLLOWING THE EVIDENCE TO BETTER POLICY: 

HOW EVIDENCE-BASED POLICYMAKING HELPED POOR NEW YORKERS

Chairman Hatch, Ranking Member Wyden, and other distinguished members of 

the committee, thank you for the opportunity to testify today on how the use of 

evidence-based policy can improve our safety net and help low-income Americans 

move up. 

In my 18 years of experience in New York City and New York State administering 

many of our Nation’s major safety net programs, we were determined to achieve 

progress in the fight against poverty. Results mattered much more than intentions. 

In both New York and here in Washington, I have found that conservatives and liberals may have different ideas for helping low-income Americans, but we all share 

a desire to enact policies that actually succeed in reducing poverty. 

At a time when government resources are limited, it is more important than ever 

to make sure the programs we do fund are effective and achieve results. Relying 

on evidence when making decisions on how to use government funds can lead to better policy and better outcomes for Americans. 

Evidence-based policymaking entails compiling strong evidence about what works 

and what doesn’t, using administrative data systems more effectively, and ending 

failing programs, while scaling up successful ones. During my time in government, 

I’ve been a part of a number of efforts that modeled this approach. Today, I will 

share the lessons learned in those experiences as well as highlight areas where policymakers could do a better job bringing these principles to bear. 

I. Conducting Rigorous Evaluations 

In order to pursue evidence-based policymaking, we must first build the evidence 

around practices, policies, and programs. Often, this requires randomized controlled 

trials (RCTs) that randomly assign participants into a treatment group that receives 

the intervention or a control group and tracks their results over time. This type of 

evaluation helps researchers mitigate selection bias and conduct impact analyses of 

government initiatives that can compare the program’s outcomes to a counterfactual 

without the intervention. 

In New York City, we performed rigorous evaluations of over 30 new initiatives 

as a part of Mayor Bloomberg’s Center for Economic Opportunity. These experiments ranged from increasing the earned-income tax credit for childless workers 

(Paycheck Plus) to a city office dedicated to educating low-income residents on managing their finances. But one in particular received a lot of attention, the first conditional cash transfer program in the developed world. The program—Family Rewards—provided cash payments to individuals who took positive actions, such as 

going to the doctor or ensuring their children regularly attended school. 

New York City leadership was excited about the potential of this program, but 

we lacked solid evidence of whether or not it would actually work. In order to find 

out, Gordon Berlin and MDRC conducted the evaluation of the experiment. Overall, 

the results showed the program was not successful. While participants saw lower 

poverty levels as a result of the program, most of the income gains came from the 

transfers themselves, not from increased earnings. And once the program ended, the 

treatment group’s incomes were not substantially different from the control group. 

We were also disappointed to see that these incentives did not significantly change 

38 

1 James Riccio et al., ‘‘Conditional Cash Transfers in New York City: The Continuing Story 

of the Opportunity NYC-Family Rewards Demonstration,’’ MDRC, September 2013, http:// 

www.mdrc.org/sites/default/files/Conditional_Cash_Transfers_FR%202-18-16.pdf. 2 Eugene Steuerle and Leigh Miles Jackson, eds., Advancing the Power of Economic Evidence 

to Inform Investments in Children, Youth, and Families (Washington, DC: The National Academies Press, 2016). 

the behavior of participants in the vast majority of the outcomes incentivized in the 

program.1

It was not surprising that a program that gave people cash transfers increased 

the amount of cash participants received. But a major objective of the program was 

to reduce intergenerational poverty by encouraging human capital investments and 

positive behavior change. Importantly, when the program did not have the positive 

impact we were hoping for, Mayor Bloomberg phased out the program. This does 

not mean that the experiment itself failed. Rather than business-as-usual, indefinite 

spending with unknown results, we avoided sinking resources into expanding a program citywide that would not meet our expectations. In addition, we also learned 

important lessons that have informed new, similar experiments in other cities 

across the country. 

Throughout the country and the Federal Government, there should be a similar 

effort to rigorously evaluate new and existing programs and policies whenever possible. The Commission on Evidence-Based Policymaking, established by the recent 

Ryan-Murray bill, is an excellent step in the right direction. The commission will 

reduce barriers for researchers, support the creation of more helpful data sets to answer key policy questions, and facilitate the use of RCTs for compiling evidence 

across the country. 

An important new report from the National Academy of Sciences, ‘‘Advancing the 

Power of Economic Evidence to Inform Investments in Children, Youth, and Families,’’ recommends that government agencies document the extent to which existing 

funding is supporting programs backed by evidence. While that report focuses on 

best practices around economic evidence, such as cost-benefit analysis, it notes that 

such methods rely on intervention impact evaluations. Preferably, cost-benefit analysis should be based on evaluations that use an RCT or a quasi-experimental method that can reasonably support causal inference. However, as the report notes, often 

this data does not exist due to ‘‘previous inattention to what might be required for 

later evaluations.’’ 2 Federal lawmakers and the new Commission of Evidence-Based 

Policymaking should take steps to encourage proper attention to rigorous evaluations, improve access to needed data, and promulgate best practices. 

As a senior fellow at Results for America and a member of the new EvidenceBased Policymaking Collaborative (which brings together scholars from a range of 

think tanks), in the coming months I will be a part of efforts to celebrate successes 

in using evidence and publish briefs on new tools that can help bridge the divide 

between program administrators and researchers. 

II. Scaling Up Successful Programs 

Just as programs failing to show results must be ended, programs backed by rigorous evaluations should see more resources channeled their way. This does not 

have to necessarily mean more government spending overall. Instead, policymakers 

should make a consistent effort to shift the resources we decide we are willing to 

commit to these areas away from ineffective programs and toward ones that are evidence-based. 

One program that has been subject to rigorous evaluations and consistently delivered a positive impact on outcomes was the Nurse-Family Partnership (NFP). Created by Dr. David Olds, the initiative connects registered nurses with first-time, 

low-income mothers during pregnancy and the early years of the child’s life. While 

the woman is pregnant, the home visits provide guidance on diet and substance 

abuse and other choices that can affect the health of the child. After the birth, 

nurses can teach the mothers about the importance of child-parent interaction for 

the development of the child and help the mothers better care for themselves as 

well. 

Critically, Dr. Olds and his colleagues conducted three RCTs in different places 

to evaluate the program and followed up with participants in the study regularly 

for decades. They found that it generated long-lasting benefits for both mothers and 

their children. Participating children saw improved cognitive development and reported fewer behavioral problems, and their mothers saw reduced mortality and reVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00042 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
39 

3David Olds et al., ‘‘Effect of Home Visiting by Nurses on Maternal and Child Mortality: Results from a 2-Decade Follow-Up of a Randomized Clinical Trial,’’ JAMA Pediatrics 168, no. 9 

(September 2014); John Eckenrode et al., ‘‘Long-Term Effects of Prenatal and Infancy Nurse 

Home Visitation on the Life Course of Youths: 19-Year Follow Up of a Randomized Trial,’’ Archives of Pediatrics and Adolescent Medicine 164, no. 1 (January 2010); David Olds et al., ‘‘Effects of Nurse Home-Visiting on Maternal Life Course and Child Development: Age 6 Followup Results of a Randomized Trial,’’ Pediatrics 114, no. 6 (December 2004); and David Olds et 

al., ‘‘Effects of Home Visits by Paraprofessionals and by Nurses: Age 4 Follow-Up Results of a 

Randomized Trial,’’ Pediatrics 114, no. 6 (December 2004). 4Lynn Karoly, Rebecca Kilburn, and Jill Cannon, Early Childhood Interventions: Proven Results, Future Promise (Washington, DC: RAND Corporation, 2005), http://www.rand.org/content/dam/rand/pubs/monographs/2005/RAND_MG341.pdf. 5 Altman Foundation, ‘‘Fund for Public Health in New York/Nurse-Family Partnership,’’ 

http://www.altmanfoundation.org/our_approach/program_highlights/fund-for-public-health/. 6 Ibid. 

7 AEI-Brookings Working Group on Poverty and Opportunity, Opportunity, Responsibility, and 

Security: A Consensus Plan for Reducing Poverty and Restoring the American Dream, American 

Enterprise Institute and Brookings Institution, 2015, http://www.aei.org/publication/opportunity-responsibility-and-security/. 8Pew Center on the States, ‘‘States and the New Federal Home Visiting Initiative: An Assessment from the Starting Line,’’ Pew Charitable Trusts, August 2011, http://www.pewtrusts.org/ 

en/research-and-analysis/reports/2011/08/24/states-and-the-new-federal-home-visiting-initiative-an-assessment-from-the-starting-line. 9Kevin Corinth, ‘‘Pay for Performance: A New Solution for Vulnerable Homeless Adults,’’ AEI 

Economic Perspectives, April 2016, http://www.aei.org/publication/pay-for-performance-a-newsolution-for-vulnerable-homeless/. 

lied less on public benefits.3 A RAND Corporation study estimated the program returned $5.70 in social benefits for every dollar invested in the high-risk population.4

Once the Nurse-Family Partnership model had developed this strong evidence 

base, it warranted being adopted on a large scale. In New York City, a small publicprivate partnership NFP initiative was piloted in 2003, but Mayor Bloomberg’s Center for Economic Opportunity, of which I was a part, made scaling up the program 

a priority. The program grew by 383 percent between 2007 and 2011.5 And our program made a significant impact: children in the program are 16 percentage points 

more likely to be current with their immunizations at 24 months, and teenage mothers in the program are 15 percentage points more likely to attain a high school diploma or GED.6

Policymakers across the country should take similar steps to expand programs 

that rigorous evaluations show are affecting outcomes. This has implications for 

Federal policymakers. For instance, in the AEI-Brookings report on poverty and opportunity, our bipartisan group agreed to continue Federal support of the Maternal, 

Infant, and Early Childhood Home Visiting (MIECHV) program, which funds homevisiting programs (including NFPs) and allocates 75 percent of its grant dollars to 

evidence-backed programs.7 And we called upon States—who allocate around a billion dollars annually to similar programs—to explicitly tie more of their funding to 

evidence-based models.8 However, this principle should not be limited to homevisiting initiatives. From work programs to child nutrition interventions, only practices with a proven track record of results should be expanded. 

Other approaches, such as performance-based contracting, can ensure that government dollars are being directed toward programs that work. In New York City, 

vendors who contracted with the Human Resources Administration were placed on 

a 100 percent performance-based payment structure that compensated service providers for helping an individual gain employment. Contractors were only paid for 

job placements where they could demonstrate that the client had retained the job 

for at least 30 days. Not only did this incentivize vendors to improve their performance, it ensured that taxpayer dollars went only to contractors when they delivered 

the outcome we were looking for—a job for the recipient of assistance. 

In a recent paper, my AEI colleague Kevin Corinth proposes using performancebased contracting to help alleviate homelessness. His plan involves measuring the 

performance of specific service providers in helping their clients avoid sleeping on 

the streets, make mental health gains, and stay out of prison. Then, service providers with consistently better performance, after adjusting for the vulnerability of 

their clients, should receive more clients and more government funding.9

Similarly, pay-for-success models, also known as Social Impact Bonds, allow innovative social programs to receive upfront funding from private investors, and if they 

meet an agreed-to metric of success, only then will government compensate invesVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00043 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
40 

10 Robert Doar, Angela Rachidi, and Maura Corrigan, ‘‘Comments on the House Ways and 

Means TANF Reauthorization Discussion Draft,’’ statement to the Subcommittee on Human Resources, Committee on Ways and Means, U.S. House of Representatives, July 24, 2015. 11 Results for America, ‘‘2016 Federal Invest in What Works Index,’’ April 18, 2016, http:// 

results4america.org/policy-hub/2016-federal-invest-works-index/. 12 Bruce Meyer and Nikolas Mittag, ‘‘Using Linked Survey and Administrative Data to Better 

Measure Income: Implications for Poverty, Program Effectiveness, and Holes in the Safety Net,’’ 

AEI Economics Working Paper Series (2015), https://www.aei.org/publication/using-linked-survey-and-administrative-data-to-better-measure-income-implications-for-poverty-program-effectiveness-and-holes-in-the-safety-net/. 

tors. This approach has tremendous potential but will also come with administrative 

challenges and has only been used in a handful of trials in the United States. 

One challenge in particular is finding governments willing to pay for specific outcomes. For example, the Nurse-Family Partnership, which is part of a pay-forsuccess project in South Carolina, can drive savings to health, child welfare, and 

other systems—but getting any single system to backstop repayment for the program is a barrier. Bipartisan legislation—in the form of the Social Impact Partnership Act (SIPA) sponsored by Senators Hatch and Bennet and Representatives 

Young and Delaney—could help to solve that problem by setting aside Federal resources to help State and localities pay for better outcomes and incentivize collective 

savings across multiple layers of government. Further, SIPA requires rigorous evaluations of new pay-for-success projects ensuring that we will continue to learn more 

about what works and bolster the evidence base for social interventions. 

Finally, we should continue to build infrastructure that helps policymakers at all 

levels of government advance evidence-based reforms. The Education Department’s 

What Works Clearinghouse, which reviews and summarizes recent scientific evidence on the effectiveness of certain practices, has been a tremendous resource for 

State and local leaders. I have called for the Administration for Children and Families to create a similar hub for research on evidence-based practices that help TANF 

recipients find employment.10 All Federal agencies should pursue a similar approach. 

Results for America recently released their 2016 Invest in What Works Index, 

which highlights the extent to which specific agencies and departments are currently building the infrastructure necessary to be able to use data and evidence in 

budget, policy, and management decisions.11 The index shows the important work 

already being done to incorporate evidence into policy at the Federal level, as well 

as places where improvement is necessary. 

III. Harnessing Administrative Data 

To build the evidence base around policy ideas, researchers need high-quality 

data. Policymakers cannot make informed decisions without a clear picture of what 

is happening in our safety net programs. Both of those objectives are complicated 

by the fact that there are inherent flaws in our primary tool for collecting information about these programs: government survey data. Dr. Bruce Meyer of the University of Chicago has documented in several studies that misreporting of income and 

benefit receipt are common in surveys. In one recent study that matched State administrative records to Census Bureau survey data, he and a coauthor found that 

the Current Population Survey missed program receipt for 40 percent of SNAP recipients and 60 percent of TANF and General Assistance recipients.12

However, administrative data is important because it provides not only more accurate information, but also enables new ways of evaluating policies and practices. 

For instance, RCTs are often expensive and time-consuming, particularly if they require longitudinal follow-up. After separating participants into the treatment and 

control groups and administering the treatment, researchers must then keep up 

with the participants for years, tracking their life outcomes through surveys. But 

not all experiments need to be so costly. An alternative is to use administrative data 

for low-cost RCTs that are fairly easy to administer for States and localities. 

Consider a hypothetical example of how this technique could be used to test a job 

training program. Researchers administer the program through an RCT, but instead 

of having to stay in touch with thousands of participants, they could simply compare 

the treatment group with the control group in outcomes that administrative data 

already tracks. In evaluating a job training program’s impact, determining whether 

its participants receive higher earnings, depend less on government assistance, or 

are more likely to pay owed child support can likely show whether it is effective 

or not. To illustrate just how cost-effective this approach can be, the Coalition for 

41 

13 Coalition for Evidence-Based Policy, ‘‘Low-Cost RCT Competition,’’ http://coalition4 

evidence.org/low-cost-rct-competition/. 

Evidence-Based Policymaking held a competition for designing and conducting a 

low-cost RCT, and all three winners had a total cost of less than $200,000.13 While 

not every evaluation can be done this affordably, efforts should be made to encourage this important tool, which can radically expand our evidence base for many programs and interventions at all levels of government. 

Similar in concept is what has been termed ‘‘rapid-cycle evaluation.’’ Rapid-cycle 

evaluation is intended to quickly study a new program or program change using rigorous methods. It is designed to help policymakers make tough decisions about the 

best way to implement programs and whether reforms and tweaks make sense without waiting years for the results of an evaluation. Evaluators work closely with program administrators to test new strategies and quickly provide results so that decisions can be made. 

In New York City, we performed a number of rapid-cycle evaluations. We piloted 

a Child Support Enforcement initiative that invited noncustodial parents to an initial meeting at the Customer Service Center in hopes that we could increase the 

number of orders established by trying to reach an agreement in a friendlier environment than a courtroom. We tested incorporating different messages into the 

SNAP online application that behavioral economics evidence suggested would improve accuracy and honesty from applicants. All involved a randomly assigned treatment and control group, and we used administrative data to compare outcomes 

across groups. 

The uses of this technique are limitless for administrators. From studying whether a reminder phone call improves client attendance at meetings to piloting new approaches for educating recipients about healthy behaviors, rapid-cycle testing allows 

policymakers to constantly improve existing programs. 

But evidence-based strategies shouldn’t end once programs have proven effective 

through rigorous evaluations. Administrative data should also be used for ongoing 

performance monitoring. Data-driven oversight can improve program performance 

by holding managers accountable for delivering results. In New York City, we used 

a performance management system called ‘‘JobStat,’’ modeled after the CrimeStat 

initiative undertaken by the NYPD. 

Every local welfare office, or ‘‘job center’’ as we called them, was issued a monthly 

report card that compared their performance on a number of measures, such as job 

placements, to what they did the previous month and what has happened in other 

offices. Managers heard a very clear message from the administration as to which 

measures we were interested in and what goals we expected them to meet. We met 

with each manager every month to hear how they were doing and, sometimes, to 

press them on why they weren’t doing better. 

This process engrained a culture of focusing on outcomes and learning from others 

who were having success—values central to the evidence-based policymaking approach. Throughout government agencies at all levels, administrators should be expected to develop similar cultures that emulate the principles of evidence-based policymaking in the day-to-day functioning of the bureaucracy. 

IV. Conclusion 

Evidence-based policymaking should not be a partisan issue. Liberals and conservatives are interested first and foremost in results, and we all agree that the government dollars we already spend fighting poverty should be used in ways that deliver the biggest impact. While all policymakers believe their decisions are backed 

by evidence, evidence-based policymaking is about following a specific process. New 

and existing programs must be evaluated in a way that establishes impact over a 

counterfactual; programs that rigorous evaluations show to be effective should be 

scaled up, while initiatives failing to have success must be phased out; and administrative data should be used to make it easier to conduct evaluations and to enable 

incremental improvements in program administration. 

I know from personal experience that program administrators are always looking 

for new research that can help them do their jobs better. Federal policymakers 

should encourage, enable, and remove barriers to conducting evidence-based policymaking at all levels of government. 

42 

PREPARED STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM UTAH

WASHINGTON—Senate Finance Committee Chairman Orrin Hatch (R–Utah) today 

delivered the following opening statement at a hearing to examine the role of outcomes and evidence standards in shaping social policies and how they can be best 

applied to program delivery and financing models: 

Good afternoon. I’d like to welcome everyone to today’s hearing on evidence-based 

practices and their potential impact on our child welfare system. 

According to the Social Policy Institute, ‘‘Evidence-based practice is a process in 

which the practitioner combines well-researched interventions with clinical experience and ethics, and client preferences and culture to guide and inform the delivery 

of treatments and services. The practitioner, researcher, and client must work together in order to identify what works, for whom, and under what conditions. This 

approach ensures that the treatments and services, when used as intended, will 

have the most effective outcomes as demonstrated by the research. It will also ensure that programs with proven success will be more widely disseminated and will 

benefit a greater number of people.’’ 

Over the years, in an effort to use taxpayer dollars more efficiently, policymakers 

have attempted to incorporate more evidence-based practices in order to improve 

outcomes for vulnerable children and families. Just looking at the jurisdiction of the 

Senate Finance Committee, there are a couple of major examples, such as the Regional Partnership Grants and the Maternal, Infant, and Early Childhood Home 

Visiting Program. 

Many experts and observers agree that, when implemented correctly and with 

strict adherence to the model, evidenced-based interventions can be an effective 

strategy to help vulnerable families and at-risk individuals. They can also reduce 

bureaucracy and eliminate the creation of perpetual and redundant programs that 

do not work. And, they can allow for local leaders to decide what is best and inject 

private-sector creativity into social services. 

But most important, evidenced-based interventions help ensure that taxpayers 

only pay for what works. 

In most programs, the Federal Government and States pay for processes or simply 

reimburse for costs, while evidenced-based interventions, when implemented correctly, help guarantee that government pays for success in achieving a desired outcome. 

This is particularly true in the context of the child welfare system. 

For example, we know that untreated substance abuse and mental health issues 

can lead to situations where children are neglected, which is the most common impetus for removing children from their homes and placing them in the foster care 

system. However, if we can find ways to effectively address these conditions, more 

children will remain safely at home. That is why Senator Wyden and I have been 

working for some time now on a proposal to improve the child welfare system. And, 

a key component of the Hatch-Wyden proposal is that these types of interventions 

must be evidenced-based. Currently, we are working with our House colleagues on 

bipartisan, bicameral legislation that we hope will provide more effective up-front 

services to help vulnerable families. 

As part of the discussion on evidence-based practices, we will also focus on what 

some call social impact financing, sometimes referred to as social impact bonds, social impact partnerships, or pay for success. 

I am a strong supporter of this approach, which is why I am pleased to have been 

able to work with Senator Bennet to introduce legislation that will foster the creation of public-private partnerships that will harness philanthropic and other 

private-sector investments to establish or scale up evidence-based social and public 

health programs. 

Furthermore, under our Social Impact Partnership bill, the Federal Government 

would establish desired outcomes to pressing social challenges that, if achieved, 

would improve lives and preserve taxpayer resources. State and municipal governments could then submit proposals to work towards those outcomes by establishing 

or scaling up existing evidence-based interventions. 

We believe this program would encourage private-sector investors to provide the 

necessary capital to establish or expand the interventions. Then, if an independent 

43 

evaluator is able to certify that the desired outcomes are achieved at reduced costs, 

the investors would be paid back their initial investment plus a small return from 

the realized government savings. There are a number of reasons I believe that social 

impact financing is key to improving outcomes for vulnerable children and families. 

For example, social impact financing provides for continual program improvement 

and ensures that all parties remain focused on the performance of the program and 

have the ability to make ongoing adjustments to ensure the outcomes are realized. 

In addition, social impact financing gives local leaders the flexibility to design and 

adjust programs to fit local needs in order to ensure they have the desired impact. 

And, as I stated earlier, when done correctly, social impact financing ensures that 

taxpayers pay only for what works. In most Federal programs, taxpayers are on the 

hook for set costs of processes and/or reimbursements with little or no regard for 

effectiveness. With social impact financing, success is measured by the ability of a 

program to achieve a desired outcome, and taxpayers only have to pay for whatever 

achieves that objective. 

Now, some critics of social impact financing may point out examples where the 

proposed interventions have not produced the desired results. They’ll raise examples 

of specific instances in which an intervention did not achieve the desired outcome 

and try to claim that it was a failure. 

But I think these critics are missing the point. 

Make no mistake, there have been instances in which, under a social impact financing model, a specific proposal has not produced the desired outcome and was 

eventually discontinued. However, that is precisely how the model is supposed to 

work. Indeed, programs and policies that are flexible enough to respond to outcomes—recreating and disseminating successes while eliminating failures—is our 

goal with social impact financing. 

That said, I am willing to admit that there is much more we can and should learn 

about the implementation and delivery of social impact financing. That is part of 

the reason for today’s hearing. 

Today we will hear from a distinguished panel of witnesses who will discuss 

evidenced-based policies and practices and share with us some of their successes 

and warnings for the future. I look forward to an interesting and robust discussion 

of all of these issues. 

PREPARED STATEMENT OF JAMES LEE SORENSON, CHAIRMAN, 

BOARD OF DIRECTORS, SORENSON IMPACT FOUNDATION

It is a pleasure and an honor to be with you today to discuss a matter of great 

importance—which is how can we more effectively measure and direct social spending in this country to produce successful outcomes. 

My life is one as a business entrepreneur turned philanthropist. When I made the 

decision to devote my time, efforts and financial resources to giving back, I was 

unsatisfied with traditional philanthropy that, compared to the business world I 

came from, was inefficient, unaccountable and didn’t move the needle enough in 

solving core problems to produce real outcomes in the lives of those in need. 

Four years ago, I endowed an applied academic center at the University of Utah’s 

Business School in order to help direct private and philanthropic capital to help 

solve some of the most perplexing social problems, both here in America and abroad 

in measurable more scalable ways through what is known as impact investing. 

Since its inception, the Sorenson Impact Center has facilitated over $100 million 

in investments into scalable, sustainable solutions to problems like chronic unemployment and criminal recidivism in the U.S. and unsafe drinking water, access to 

education and health care, and rural poverty in places like Sub-Saharan Africa and 

Southeast Asia. 

Over the past 2 years, the Center has also been engaged in structuring nearly 

a dozen ‘‘pay for success’’ projects around the country with a variety of stakeholders, 

including State and local government, nonprofit organizations, academics, philanthropists, and other funders. 

These projects are aimed at addressing some of the most complex and challenging 

issues facing our country today, including intergenerational poverty, homelessness, 

44 

foster care, mass incarceration, chronic unemployment, educational achievement 

gaps, mental illness, and substance use disorders, to name just a few. But most importantly, they do it in a way that is more effective by employing evidence based 

best practices and measured outcomes. 

I’d like to give you a brief overview of how the projects work: 

(1) First, government or another entity like a hospital decides to pay for certain 

meaningful and measurable outcomes—not for activities, not for the promise 

of outcomes, but for actual achieved outcomes. An example may include a 

sizable increase of students with diagnosed learning disabilities meeting 

grade-level performance targets. 

(2) A service provider—which can be local, regional, or national—then agrees 

to provide the necessary intervention(s) to deliver the desired outcomes. 

(3) Philanthropists and/or other funders provide upfront capital to finance the 

service provider’s intervention. 

(4) An independent evaluator conducts a rigorous evaluation in order to determine whether the service produced those specific, predetermined outcomes. 

(5) Finally, if those exact outcomes are achieved and the project is successful, 

government, the hospital, or whichever entity promised to pay upon successfully meeting those outcomes, will then—and only then—pay back the initial 

funders. 

These projects are noteworthy for a number of reasons: 

(1) Stakeholders agree at the outset of the project on a set of definitive, measurable indicators of success. 

(2) We learn more about what programs actually work and which don’t, knowledge that Congress and others can use to decide where to allocate limited 

taxpayer dollars. Often innovative preventative programs that are unfunded 

by resource scarce government budgets can receive funding. 

(3) This fosters a competitive social services environment—a virtuous ‘‘race-tothe-top’’—for nonprofits and other social service providers since only the 

most impactful, evidence-based programs are eligible for this type of funding. 

(4) Nonprofits and social service providers are encouraged and supported to 

focus more on serving people in need and less on fundraising. 

(5) Proven, high-quality preventative programs are prioritized over costlier and 

less effective remedial programs and infrastructure. 

a. For example, funding an evidence-based substance abuse treatment 

keeps at-risk individuals out of more expensive jails and prisons, homeless shelters, and emergency departments and keeps their children out 

of the child welfare and foster care systems. 

b. This evidence-based intervention results both in a more optimal outcome 

for the individual and saves society a lot of money over the long-run. 

We have seen significant traction with these projects at the State and local levels—nearly a dozen have launched in recent months/years, with another 50 in various stages of development across the country, spanning both Republican and Democratic States. 

I would also note the tremendous power of the model to bring together stakeholders from across the government, nonprofit, academic, philanthropic, and forprofit sectors to collectively problem-solve and serve individuals and families in 

need. 

While the Federal Government has, thus far, played an important role in all of 

this by encouraging and developing the capacity of various stakeholders to help 

build a pipeline of projects, it has been conspicuously absent in one critically important respect: 

In many of these State and local projects, the lion’s share of the societal value 

and economic benefit generated actually accrues to the Federal Government 

budget, not the local budgets. 

We call this a ‘‘wrong pockets’’ problem in the industry because there’s effectively a mismatch between who gets asked to pay for a program and ultimately 

who stands to benefit most from that program. 

This is why I am so thankful for Chairman Hatch’s and Senator Bennet’s introduction of the Social Impact Partnership Act, S. 1089, legislation that directly addresses this issue by enabling the Federal Government to pay for a portion of the 

45 

project outcomes that deliver the government direct Federal savings or value. Because State and local government cannot, in most cases, tap Federal funding to pay 

for outcomes, they currently have no ability to leverage Federal savings to pay for 

positive outcomes that benefit Federal budgets alongside State and local budgets. 

Consequently, State and local governments today are severely limited in the number 

and scale of pay for success projects that can be developed. 

Two examples are worth highlighting in this context: 

(1) An evidence-based asthma prevention program drives significant savings to 

the Federal Medicaid budget by cost-effectively addressing the key causes 

of asthma in low-income homes and thereby reducing the incidence of emergency department hospitalizations due to acute asthma attacks. 

a. However, in many States, local/State governments will realize only pennies on the dollar of overall cost savings to society. 

b. The Federal Government, on the other hand—through Medicaid in this 

instance—is the primary beneficiary of the program. Yet Federal agencies currently do not have the ability to negotiate success payments for 

outcomes with local stakeholders. 

c. As a result, promising projects like these don’t happen, children don’t receive proven preventive solutions to debilitating problems like asthma, 

and the Federal Government keeps paying for costly emergency room 

visits. 

(2) A highly evidence-based nurse home visitation program that works with 

low-income, first-time mothers results in tremendously positive (and valuable) outcomes, like reductions in the incidence of pre-term births, domestic 

violence, etc.—thanks to the tireless work of healthcare providers like 

Teisha who is with me on the stand from Nurse Family Partnership. 

a. As with the asthma program, State and local government budgets benefit to a certain degree, but the bulk of the overall benefit accrues to the 

Federal Government. 

b. Again, without the ability to leverage those Federal savings, it is very 

difficult for State or local dollars alone to fund an intervention like 

Nurse-Family Partnership at scale. 

Tying taxpayer dollars to actual performance in the social sector—and securing 

measurable results in individuals’ and families’ lives—is a pretty remarkable innovation, and pay for success financing is becoming an important tool to address some 

of society’s most chronic and persistent social problems. 

What’s also remarkable about the model is the level of bipartisan support in State 

governments and city halls around the country—people from across the political 

spectrum agree that it makes sense to be more results-oriented, data-driven, and, 

ultimately, more accountable in the way we address social problems in this country. 

This level of bipartisan support is a tribute to the fact that the Senate bill is itself 

a bipartisan effort by Senators Hatch and Bennet, as is its companion bill in the 

House. This legislation has also been cosponsored by Republican Senator Kelly 

Ayotte and Democratic Senator Cory Booker. Further, the legislation’s companion 

bill in the House has 41 cosponsors and is publicly supported by Chairman Ryan. 

In my experience, pay for success financing really resonates with policymakers, 

partly because they take seriously their role as stewards of precious taxpayer resources; it also resonates with many who hold out hope that if we are deliberate 

and thoughtful enough and partner with a range of stakeholders along the way, 

these problems can, in fact, be solved. 

PREPARED STATEMENT OF HON. RON WYDEN, 

A U.S. SENATOR FROM OREGON

I would like to start off by noting that—if my research is correct—this is the first 

ever hearing this committee has held on this topic. 

This is a great opportunity to dig into an issue that really should be an underpinning of the work Congress does every day. That is to say, we should be constantly 

asking whether the laws we write are working as they ought to be. 

And to add another layer on that: does the way the Federal Government funds 

our programs obstruct or facilitate improvement? 

46 

Right here in this committee, there are shining examples on both ends of the spectrum. 

The home visiting grants fund a variety of models to help parents of young children essentially improve their parenting skills. More resources are available for programs that can demonstrate the best results, with help along the way for newer, 

promising programs to build up their evidence base. 

The home visiting models have had huge success, leading to healthier births, reduced child maltreatment, reduced criminal justice system involvement, and higher 

employment rates for the parents themselves. 

On the other end of the spectrum is the Temporary Assistance for Needy Families 

program. 

There are real questions about whether the way success is measured in the TANF 

program is leading to success for the families it is meant to help. 

Instead of rewarding States for helping families find work or reduce poverty, 

TANF rewards States for simply reducing the number of families they serve regardless of the need. 

And while a small amount of TANF dollars is reserved for welfare research, 

there’s no built-in feedback loop to ensure what’s being paid for is actually what 

works. Congress ought to be finding ways to build in that type of continuous program improvement. 

Now, there are certainly limitations to this approach of funding what works and 

not funding what doesn’t. 

To start, researching and evaluating programs can be expensive, and in some programs it would be unethical to have a control group that is actively denied services. 

For example, it would be wrong to deny a child access to foster care when she is 

being abused and neglected just for the sake of scientifically evaluating the effects 

of foster care against a control group. 

Additionally, bringing evidence-based programs to bigger scale can also be expensive—they often rely on a highly educated and trained workforce. So progress may 

be slow. 

Finally, reasonable people can disagree on what it really means for a program to 

be successful. For example, there’s no question the SNAP program has had success 

in reducing hunger and food insecurity for many families across the Nation, but others may place less value on those outcomes. 

I know that witnesses today will speak to new approaches to testing out and paying for innovation—especially social impact financing or pay for success. 

My home State of Oregon, like many States, is exploring the feasibility of social 

impact financing. And like many States, Oregon is witnessing firsthand the challenges with deciding whether taxpayer dollars should be used for this type of financing. 

I look forward to the discussion around the strengths and limitations of that 

model. 

I commend the chairman and our colleague Senator Bennet for bringing the conversation around these innovative partnerships to the Senate and to this committee 

with their Social Impact Partnership Act. 

To our esteemed witnesses—you’ve got a lot of ground to cover today. This topic 

is anything but narrow, so I commend you in advance for the breadth of expertise 

you bring to the conversation and look forward to hearing from you this morning. 

(47) 

COMMUNICATIONS

ADOPTION RHODE ISLAND

Every Child Deserves a Home 

Two Bradford Street • Providence, RI 02903 

tel: 401–865–6000 • fax: 401–865–6001 • www.adoptionri.org 

To: Senator Orrin Hatch, Chairman Committee on Finance 

Senator Ron Wyden, Ranking Member Committee on Finance 

Members of the U.S. Senate Committee on Finance 

From: Darlene Allen, Executive Director, Adoption Rhode Island 

Re: Using Evidence-Based Programs to Promote Child Welfare Outcomes 

Date: May 19, 2016 

Adoption Rhode Island, on behalf of the thousands of children, youth, and families 

we serve in Rhode Island, is pleased to submit this written testimony on the importance of evidence-based and evidence-informed practice in public child welfare. As 

Chairman Hatch expressed during the Senate Finance Hearing on Evidence-Based 

Delivery and Funding for Social Welfare Programs, evidence-based practice can be 

an effective strategy to help vulnerable families and at-risk individuals. Adoption 

Rhode Island strongly supports evidence-based and evidence-informed interventions 

designed to improve outcomes for foster children and we advocate for funding opportunities to test and evaluate the effectiveness of innovative strategies to improve 

permanency outcomes for children and youth. 

Founded over 30 years ago, Adoption Rhode Island’s mission is to facilitate, promote 

and support the permanent placement of children waiting for adoption and to improve the well-being of foster and adopted children and their families. We provide 

services to children and families, educate and advocate for a child’s right to a safe 

environment, and increase public awareness of the unmet needs of children and 

families impacted by foster care and adoption. 

Adopted children who have experienced trauma are two to five times more likely 

to require psychological treatment. Providing individual supportive counseling and 

crisis intervention helps address problems early and effectively so that children can 

move beyond their traumas and experience the joy of childhood again. Each year, 

Adoption Rhode Island serves nearly 1,500 children and families through comprehensive and flexible support services, including adoption recruitment and placement support; individual, family, and group counseling; support and education 

groups for parents, children, teens, and families; and adoption preparation and disruption prevention services. 

Rhode Island’s rate of youth placed in congregate care is twice the national average 

and the foster care system in Rhode Island and across the nation experience an 

over-reliance on psychotropic medication. Thirty-five percent (35%) of children in 

foster care are prescribed psychotropic drugs, compared to 10% of other children. Although many youth in foster care experience significant emotional challenges, mental and behavioral health is the largest unmet health need for children and teens 

in foster care, according to the American Academy of Pediatrics. In fact, 30% of foster care alumni are diagnosed with Post-Traumatic Stress Disorder (PTSD), about 

twice the rate of combat veterans. 

According to a ground-breaking study from the Centers for Disease Control and Prevention and Kaiser Permanente, experiencing trauma in childhood has a significant 

impact on development, including illness, early death, and poor quality of life. When 

people caring for a traumatized child do not understand the connections between a 

48 

child’s behavior and his/her trauma history, they can become frustrated and impatient with a child’s development, which can impact bonding, attachment, and permanency. When that child is a foster child, lack of understanding of the long reach of 

trauma can lead to unstable foster home placements, exacerbation of traumatic 

stress, secondary trauma for family members, and disruptions in placement and 

even adoption dissolutions. 

Foster, adoptive, and kinship caregivers (i.e., resource parents) need a foundation 

of information about child traumatic stress, so they can help the child develop new, 

more positive coping skills. Having this knowledge and skills helps resource parents 

create a nurturing environment in which children can thrive. In Rhode Island, there 

has been a significant increase in the number of relatives and kinship placements 

caring for children, up to 31% of out-of-home placements in 2014. In addition, there 

are an untold number of relatives caring for children who have not been removed 

from the home by child protective services, but whose parents cannot care for them. 

Many of these families who are not involved in public child welfare may need services and may be receiving other community-based services. These families need access to trauma-informed and permanency-competent services to achieve positive outcomes for these youth and families. 

Public and private agencies that provide services to children and families impacted 

by foster care and adoption must be able and willing to enhance accountability, improve results, and adjust service delivery based upon learning what works. Funding 

of public child welfare services must consider compelling evidence that programs 

will have a meaningful and observable impact on the children and families in their 

care, and that demonstrate how the outcomes against which programs have been 

evaluated are relevant, achievable, and impactful. Evidence-based programs, evidence-informed programs, and innovative programs developed with deep knowledge 

of child safety, permanency and well-being are paramount to achieving success for 

children and families in the United States. 

Below are evidence-based, evidence-informed or effective and promising practice 

models offered by Adoption Rhode Island that improve outcomes for children and 

families who have been impacted by foster care and/or adoption. We also provide 

training and education for professionals such as the Child Welfare Trauma Training 

Toolkit, outreach and public awareness about foster care and adoption, court liaison 

services with Family Court, and a host of adoption-competent consultation services 

in order to promote not only permanency, but child and family well-being as well. 

• Caring for Children who have Experienced Trauma (aka Resource Parent Curriculum), available through the National Center for Childhood Traumatic Stress 

(NCTSN). 

• Darla Henry’s 3–5–7 Model©—Preparing Children for Permanency. 

• Post-adoption Support Services and Family Preservation. 

• Wendy’s Wonderful Kids Child-Focused Recruitment. 

• Family Finding: Family Search and Engagement for Relational and Legal Permanency. 

• Trauma-Focused Cognitive Behavioral Therapy (TF–CBT). 

• Eye Movement Desensitization and Reprocessing (EMDR). 

We are encouraged by the commitment to children’s safety, permanency, and wellbeing demonstrated by Chairman Hatch, Ranking Member Wyden, Senator Bennet, 

as well as their House colleagues Congressman Langevin and Congresswoman Bass 

and many on both sides of the aisle. It is our hope that across the country, effective, 

efficient and child/family focused services are available and accessible for all children and families who need them and that the voice of children and families impacted by foster care and adoption continues to drive policy and financing discussions. 

If you would like any more information about the innovative and best-practice work 

being done in Rhode Island and other parts of the country, please feel free to contact 

me at 401–865–6000 or dallen@adoptionri.org. We look forward to continuing to 

work together to improve the lives of children and families. 

Sincerely, 

Darlene Allen, MS 

Executive Director 

Adoption Rhode Island 

49 

AMERICAN EVALUATION ASSOCIATION

2025 M Street, NW, Suite 800 | Washington, DC 20036 USA | Phone: +1–202–367–1166 

USA Toll Free: 1–888–232–2275 | Fax: +1–202–367–2166 | www.eval.org 

Date: May 16, 2016 

To: The Honorable Orrin G. Hatch, Chairman, U.S. Senate Finance Committee 

The Honorable Ron Wyden, Ranking Member, U.S. Senate Finance Committee 

From: John Gargani, President, American Evaluation Association 

Re: Senate Finance Committee Hearing ‘‘Can Evidence-Based Practices Improve 

Outcomes for Vulnerable Individuals and Families?’’ held on Tuesday, May 

10, 2016 

The American Evaluation Association (AEA) is pleased to write in support of the 

work of this Committee regarding rigorous evaluation of federal social programs intended to help low-income Americans. This area has a rich tradition of applied research and experiments that have provided invaluable information to policy makers. 

We applaud your interest in applying evidence to identify those programs which can 

best help vulnerable families and at-risk individuals. 

You mentioned in the recent Committee hearing, ‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ that you have been working for some time now on a bipartisan, bicameral legislative proposal to improve the 

child welfare system. A key component of this Hatch-Wyden proposal is that these 

types of interventions must be evidence based. In addition, you cited the HatchBennet Social Impact Partnership bill reintroduced in April 2015 (S. 1089), which 

also relies on evaluation evidence to establish model impact before establishing or 

scaling up programs. Both of these initiatives are positive approaches to strengthening the link between evaluation and program effectiveness. 

Program evaluation is essential because it contributes to assessing the strengths 

and weaknesses of programs, policies, and organizations to improve their effectiveness. It provides a useful and important tool to address the need for credible information, well-grounded decision making, and governmental transparency. Evaluation 

uses systematic data collection and analysis to address questions about how well 

government programs and policies are working, whether they are achieving their objectives, and why they are, or are not, effective. It produces evidence that can be 

used to compare alternative programs, guide program development and decision 

making, and reveal effective practices. By its very nature, it supplies the publicly 

accessible information that is at the heart of transparency and open government. 

AEA supports efforts to ensure more social programs are evaluated to determine 

their impact and to consider how high-quality evidence can best be used to inform 

the design of social programs at the federal level. In particular, AEA believes that 

Congress should ensure that sufficient resources are made available for quality evaluation and encourage agencies to set guidelines for the conduct of evaluations, including the development of evaluation agendas and plans for disseminating evaluation findings to staff and the public. 

AEA heartily endorses the use of rigorous evidence about what works. Depending 

on the focus of the inquiry and the circumstances under which programs operate, 

a range of evaluation study designs are available to provide high-quality actionable 

evidence about programs. Furthermore, evaluations of program impact are most 

likely to be useful in a broader portfolio of evaluation activity which includes attention to program enhancement, program implementation, and evidence about the 

generalizability of impact evaluation findings. For example, ancillary study of the 

operations and best practices of programs could inform managers and policy makers 

how best to modify promising programs in order to maximize their effectiveness or 

how to best scale up model programs on a wider basis. 

These different uses of rigorous, actionable evidence highlight the importance of 

matching available evaluation methods to specific contexts. For example, randomized control trials are excellent for answering some questions for evidence-based 

decision-making but not others. Further, in some situations where ethical, legal, or 

logistical restrictions may constrain the assignment of program participants in a 

randomized control trial, experimental research has shown that strong quasiexperimental study designs can supply high-quality, credible evidence for decision 

making. 

AEA has approximately 7,200 members representing all 50 states and the District 

of Columbia as well as over 80 foreign countries. Members have backgrounds in govVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00053 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
50 

ernment, academia, foundations, and organizations, bringing with them a wealth of 

knowledge on evaluation approaches and the use of evaluation results. On the AEA 

website is posted a document we developed to help governments engage in effective 

evaluation: An Evaluation Roadmap for a More Effective Government [http:// 

www.eval.org/evaluationroadmap]. I hope you will find it useful. 

AEA has long sponsored academic research and fostered exchanges among evaluation practitioners regarding evaluation methodologies that can most effectively shed 

light on the causes and remedies for poverty. If we can be of assistance, or if you 

need more information on our organization, please do not hesitate to contact me 

(president2016@eval.org) or Dr. Cheryl Oros, our senior advisor for evaluation policy 

(EvaluationPolicy@eval.org; 202–367–1166). 

Sincerely, 

John Gargani, Ph.D. 

President, American Evaluation Association 

AMERICA FORWARD

1400 Eye Street, NW, Suite 400 

Washington, DC 20004 

Senate Finance Hearing: ‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ 

Date: May 10, 2016 

Chairman Orrin Hatch Ranking Member Ron Wyden 

Senate Finance Committee Senate Finance Committee 

Dirksen Senate Office Building Dirksen Senate Office Building 

Washington, DC 20510–6200 Washington, DC 20510–6200 

Dear Chairman Hatch and Ranking Member Wyden, 

Thank you for the opportunity to submit a Statement for the Record in follow up 

to the Committee’s May 10th hearing entitled ‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ 

America Forward is the nonpartisan policy initiative of New Profit, a pioneering 

national venture philanthropy fund that seeks to break down barriers between all 

people and opportunity in America. To date, New Profit has invested over $150 million in scaling innovative organizations’ impact. America Forward’s mission is to 

unite social innovators with policymakers and advance a public policy agenda that 

fosters innovation, rewards results, catalyzes cross-sector partnerships, and translates local impact into national change. 

The America Forward Coalition is comprised of more than 70 social innovation 

organizations that champion innovative, effective, and efficient solutions to our 

country’s most pressing social problems. Our Coalition members are achieving measurable outcomes in more than 14,500 communities nationwide, touching the lives of 

8 million Americans each year, and driving progress in education, workforce development, early learning, poverty alleviation, public health, Pay for Success, social innovation, national service, and criminal justice reform. Together, we have leveraged 

$1.5 billion for social innovation and have driven millions of federal resources toward programs that are achieving measurable results for those who need them 

most. America Forward believes that our nation’s social innovators can lead the way 

to unlocking America’s potential—and help move all of America forward. 

What We Believe 

At America Forward, we value innovation as an essential mechanism for improving 

our nation’s efficiency and effectiveness in addressing social challenges. We view innovation as a cycle in which a pattern-changing idea is developed, assessed, tested, 

evaluated, and then refined (if it successfully achieves greater value) or abandoned 

(if it does not). For this cycle to work in the social policy arena, there must be clarity regarding the outcomes sought, flexibility to try new approaches and providers, a measurement system to determine if the approach is effective, and resources that follow positive results. Unfortunately, it is the rare government 

program that adopts and supports this cycle. Too often, outcomes are not clearly 

specified or focused on at all, approaches are too narrowly dictated and do not focus 

on prevention, the ability to measure results are severely limited, and resources are 

locked into specific providers or programs, even if others would yield greater value. 

As a result, the federal government may fund the same ineffective programs for decVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00054 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
51 

ades without combating the root cause of the targeted problem, costing taxpayers 

billions of dollars and undermining the potential of the people who the programs 

are intended to help. 

During the Senate Finance Committee hearing, the value of outcomes, flexibility, 

measurement, and paying for what works were all touched on both by the witnesses 

and members of the Committee. In addition, the current reality of federal government policies and programs, and their misalignment with these elements of an innovative approach to our social services system, was also lifted up. America Forward 

believes there are key policies that could be advanced to address this disconnect and 

our Coalition members are proof points of how these ideas could translate into real 

impact for individuals in communities across our country. 

Data, Outcomes, and Measurement 

A key element of an innovative and evidence-based social services sector is the development of data, the use of data to determine outcomes, and access to measurement tools that can analyze data to appropriately assess impact. Though the development of data and data points across agencies and programs is not an issue for 

the federal government, right now, and for a variety of reasons, the use of and access to that data to determine outcomes and assess impact are areas where there 

is a lack of clear policy and needed resources. America Forward has concrete ideas 

as to how to address these problems and believes the Committee should consider 

these policy changes in order to advance the effort to an evidence-based social services sector. 

(1) Subject to privacy protections, the federal government should amend laws and 

regulations to permit relevant federal, state, and local agencies, nonprofit organizations, social enterprises, and other institutions to have access to federal 

databases such as the National Directory of New Hires and to the Unemployment Insurance Wage Records in order to better assess impact of federal programs using administrative datasets such as these to drive down the cost of 

evaluations. 

(2) For key outcomes that are of interest to the federal government, Congress, in 

consultation with relevant agencies, should establish uniform outcome definitions and an accurate methodology for analyzing these outcomes in order to 

ensure consistent and accurate illustrations of the impact (or lack thereof) of 

providers and programs funded by federal funding. 

(3) The federal government also has the opportunity to encourage the use of lowcost Randomized Controlled Trials (RCTs) that are seen as the most rigorous 

evaluation design format. The government can also encourage the use of 

quasi-experimental designs, which do not require random assignment, thereby 

ensuring that services are not denied to those who need them, but maintain 

control and experimental group rigor. 

(4) Recently, the Evidence-Based Policymaking Commission Act (H.R. 1831 and 

S. 991) was enacted into law establishing a Commission on Evidence-Based 

Policymaking. This Commission is tasked with studying how best to expand 

the use of data to evaluate the effectiveness of federal programs and tax expenditures. The development of this commission should be supported and the 

findings of their work should be swiftly integrated into the work of this Committee and Congress. 

Flexibility 

Many federal policies and funding streams have rigorous definitions associated with 

how programs should be structured and the inputs/outputs associated with the allocation of funding. This lack of flexibility results in a lack of innovation in our approach to government funded social services. Agency-wide waivers and Performance 

Partnership Pilots are just two examples of current federal policies that allow flexibility and the ability for states, localities, and providers to innovate on their approach to the delivery of social services programs. 

Waivers and Performance Partnership Pilots allow demonstration of ways to more 

efficiently and effectively allocate federal mandatory and discretionary funding respectively to implement evidence-informed practices to improve outcomes for various 

populations. Broad utilization of waivers should be encouraged by states and ideas 

such as Performance Partnership Pilots should be resourced and applied to populations beyond opportunity youth. These demonstrations should also be continued 

and expanded to other federal programs serving populations in need, both for the 

knowledge they generate and to inform permanent policy approaches to the issues 

and populations addressed by these time-limited demonstrations. 

52 

Pay for Success 

Pay for Success is a funding approach where government pays for services if a program gets results. Pay for Success drives government funding toward high-quality, 

effective programs that measurably improve lives. Specific interventions are not 

spelled out, allowing providers the flexibility to adopt whatever strategies they determine will be most effective in achieving outcomes for those in need. In some 

cases, private investment provides upfront financing, taking on the risk that the 

intervention will not succeed and recovering the investment if it does. 

Contracts designed to ‘‘pay for success’’ and emphasize outcomes have several advantages: (1) incentives are created for cost-effective interventions and thus programs have the flexibility to focus on the most effective strategies and emphasize 

prevention over remediation; (2) investments are supported that have longer-term 

social and financial benefit than those currently supported within the typical one 

year government budget cycle; (3) fewer resourcesare wasted on bureaucracy so 

more funds can go to program delivery rather than to compliance with rules and 

regulations; and finally, (4) government, and therefore taxpayers, only end up paying for effective programs that work. 

Pay for Success gives governments the ability to support high-impact service providers; drive resources to effective social programs; and track outcomes, not just outputs, for individuals and communities. This structure helps government to effectively and efficiently provide services to those in need. 

In some cases, an intervention may prove to reduce public costs. Sometimes these 

reduced costs can be used to repay private investors who funded the cost-saving 

intervention up front. When these public savings accrue to a single agency—e.g., the 

prison system for example, the savings can be captured and repurposed to repay 

this kind of investment. In other cases, these public savings may accrue to multiple 

agencies, making it more challenging to consolidate the funds and repurpose the 

savings to repay investors. And in still other instances, the public savings may not 

occur for many years—e.g., investments in education for youth that result in savings 

later in life—and thus not produce funding that can be used in the short term to 

repay investors. It is also the case that some interventions may not directly reduce 

public costs but instead are budget neutral while increasing the number of individuals served. In these instances, there is not a specific dollar figure that can be 

repurposed or reinvested by government but a noted increased efficiency in the utilization of public dollars. The ultimate efficiency benefit of a Pay for Success arrangement is not reducing budgets or cutting funds, but rather the more efficient use of 

public dollars to achieve better outcomes and measurably improve people’s lives. 

However, Pay for Success is also about effectiveness—moving public funding to interventions that build and use evidence to deliver results—this mechanism can be used 

to structure government contracting and funding in ways that incent these results, 

with or without private sector investment. For example, government can provide 

funding for the evaluation required to build the evidence base, and for performance 

management systems that enable organizations to use evidence in program implementation. Government can provide financial incentives—bonus payments and the 

like—when programs demonstrate better than average, measurable impact. Government can also incent the leveraging of private philanthropy to provide matching 

funds that cover these costs. Pay for Success has many important implications for 

retooling government’s approach to tracking the allocation of funds from one focused 

primarily on outputs and within individual agencies to one tying funds to results 

impacting multiple agencies. 

Federal policymakers can advance Pay for Success by creating incentives for federal 

agencies or state and local governments to test such models, providing funding for 

and encouraging technical assistance advisors to explore the feasibility of and create 

pathways towards potential Pay for Success transactions, and addressing data systems and privacy issues related to the evaluation of programs in Pay for Success. 

Shifting resources from unproductive programs to Pay for Success models that pay 

based on the achievement of outcomes will ultimately make taxpayer dollars more 

productive and improve the lives of those whom these programs are designed to 

help. 

America Forward is encouraging the creation of an incentive fund at the federal 

level to expand the piloting and use of Pay for Success. America Forward has been 

working closely with the current Administration and key champions in Congress on 

a bipartisan, bicameral approach to create such a fund that could be used to structure Pay for Success projects and contracts, fund feasibility work, evaluation, and 

contribute to success payments. This legislation, known in the Senate as the Social 

53 

Impact Partnership Act (S. 1089), was introduced in both the 113th and 114th Congresses by Committee Chairman Hatch and Senator Bennett. This legislation would 

provide funding to promote a variety of Pay for Success approaches and also test 

social innovation financing of Pay for Success strategies. In times of tighter budgets 

and greater demand for social services, we must work together to direct government 

resources to the most efficient programs that measurably improve people’s lives. Pay 

for Success has the potential to incentivize more efficient use of government resources to reward what works, linking government dollars to positive outcomes, and 

leveraging those dollars to attract private capital into the social services sector. 

The results from the first Pay for Success project in the U.S. at Riker’s Island were 

much anticipated and particularly important not only for the young men being 

served by the intervention but to the overall Pay for Success movement. Last year, 

when the results from the project to that point were released, there was initial disappointment for those who are Pay for Success champions and who hoped for a better result for the young men in Riker’s. Though the intervention lacked evaluative 

impact, and thus was discontinued and the Pay for Success project ended, the messaging around the results was helpful in articulating that ‘‘success’’ in Pay for Success means many things. Specifically, not only did the project end but the government did not pay out any money for the project given the lack of evaluative impact. 

The ‘’success’’ here then is that the approach—to pay only if a successful outcome 

is achieved—is possible and can be effectively executed. 

The announcement that followed from the second Pay for Success project in the 

U.S., the Utah High Quality Preschool Program, was very different from the announcement made regarding the Riker’s project but no less significant. The headline 

of the United Way of Salt Lake press release perfectly sums up the results: ‘‘Social 

Impact Bond for Early Childhood Education Shows Success.’’ It was determined that 

109 out of 110 at-risk Utah students avoided special education services following access to high-quality preschool. This is a 99 percent success rate, which is incredibly 

impressive. These results are also incredibly high and may be called into question 

as a result. As those stakeholders in the Riker’s Island Project did, the Utah Pay 

for Success community has been open to criticism and transparent about the evaluation design, process, and analysis of their effort. With each milestone in these projects, there is an opportunity for education and development of a deeper understanding of Pay for Success and those engaged in these projects need to support 

transparency from their development and resource the ability to share lessons 

learned. 

At America Forward, we believe that Pay for Success has the potential to bridge 

the divide between the ‘‘business as usual’’ system—where we continue to provide 

the same services, in the same way, to address the same problems but with little 

to no accountability for achieving the desired results—to the future we want, where 

we are able to provide high-quality prevention services to ameliorate future remedial services such as special education, increase employment opportunities for those 

seeking second chances, and provide the opportunity for families to stay together 

and thrive without the need for government intervention or support. It is only by 

testing the approach to ‘‘paying for success’’ that we can determine how to really 

bridge this divide. 

As the Committee considers legislation supporting Pay for Success, we urge that you 

consider the following principles: 

• Enable providers to participate even if they have not previously been a major 

recipient of public funding. If opportunities are limited to existing providers, innovative organizations that offer better outcomes will be excluded. 

• Be careful to identify a range of appropriate benchmarks rather than a single 

long-term outcome. Such benchmarks enable organizations to track their results 

and make adjustments as necessary. 

• Ensure that consideration is given not only to the potential for cost savings or 

increased tax revenue through these arrangements but also to greater efficiency 

in the utilization of public dollars resulting in more individuals served using the 

same allocations, and to the potential for long-term impact across multiple government agencies. 

• Include resources for a partnership with a credible technical assistance advisor. 

It is difficult for governments to work alone to support the education, feasibility 

analysis, and the financial modeling necessary to launch these initiatives. The 

technical assistance advisor should have a track record of exploring the feasibility of Pay for Success in different localities and in launching Pay for Success 

transactions. 

54 

1The United States Center for Disease Control and Prevention defines obesity in adults as 

having a body mass index (BMI) of 30 or higher. 2 Cawley, J., Meyerhoefer, C. The Medical Care Costs of Obesity: An Instrumental Variables 

Approach. Journal of Health Economics. 2012; 31(1): 219–230. 3 Cawley, J., Meyerhoefer, C. The Medical Care Costs of Obesity: An Instrumental Variables 

Approach. Journal of Health Economics. 2012; 31(1): 219–230. 

• Develop systems that prevent providers from choosing only those clients who 

are easiest to serve, while also retaining flexibility for providers to serve multiple at-risk populations. • Include a partnership with a credible research organization to conduct evaluations that most feasibly and appropriately measure the reform’s impact on government spending and on participants’ well-being (and any other key program 

goals). • Create opportunities and funding for government agencies to learn from others’ 

experiences and build the capacity of providers, technical assistance advisors, 

and intermediaries to participate in Pay for Success programs. • All final Pay for Success documents are encouraged to be in an ‘‘open source’’ 

format and should be posted on the internet/web platform. 

Thank you for the opportunity to submit a Statement for the Record. America Forward would be happy to provide clarification of any of the points raised or provide 

any additional information you request. Please do not hesitate to contact Nicole 

Truhe, Government Affairs Director of America Forward at Nicole truhe@ 

newprofit.org if you would like to discuss these comments further. 

Sincerely, 

Nicole Truhe 

Government Affairs Director, America Forward 

CAMPAIGN TO END OBESITY ACTION FUND (CEO–AF) 

1341 G Street, NW, 6th Floor, Washington, DC 20005 

STATEMENT FOR THE RECORD 

‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable 

Individuals and Families?’’ 

May 10, 2016 

The Board, advisors, and supporters of the Campaign to End Obesity Action Fund 

(CEO–AF) appreciate the Senate Finance Committee’s efforts to examine the role 

of outcomes and evidence standards in shaping social policies and how they can be 

best applied to program delivery and financing models. This approach to policymaking, alternately called ‘‘social impact financing,’’ has the potential to leverage 

taxpayer dollars in a smarter, more efficient way. In this context, we urge the Committee to also consider tax policy approaches that increase access to resources that 

elude many Americans and that are proven to be an effective tool in the fight 

against America’s obesity epidemic. 

The CEO–AF is the largest non-partisan advocacy organization focused on changes 

in federal policy to prevent and treat obesity America. In its work, the CEO–AF convenes leaders from across industry, academia, patient, public health, and disease 

communities to speak with one voice for commonsense, consensus policy measures 

to reverse the epidemic and promote healthy weight in children and adults. 

The Need for Policy 

The need for federal policy measures to address obesity has never been more acute. 

By virtue of the sheer prevalence of the disease, as well as the direct health care 

costs associated with treating the individuals with obesity, the economic toll of the 

U.S. obesity 1 epidemic threatens the viability of both our health care marketplace 

and our budget. Currently, nearly 100 million Americans have obesity. As a result, 

the Congressional Budget Office reported in 2010, nearly 20 percent of the increase 

in U.S. health care spending is attributable to growing obesity rates. Today, spending (both direct and indirect) on care for individuals with obesity in the U.S. may 

exceed $275 billion annually.2 In addition, annual medical costs for individuals with 

obesity are $2,741 higher than they are for healthy weight individuals.3 Absent a 

reversal in the current obesity trend, experts project that 50 percent of Americans 

55 

4 Ernst and Young. The New Markets Tax Credit: Opportunities for Investment in Health 

Foods and Physical Activity. Washington, DC: Ernst and Young; 2013. 5 According to the United States Department of Agriculture, a food desert is defined as an 

urban household more than 1 mile from the nearest supermarket and a rural household more 

than 10 miles from one. 6 Ibid. 

7 Ernst and Young. The New Markets Tax Credit: Opportunities for Investment in Health 

Foods and Physical Activity. Washington, DC: Ernst and Young; 2013. 

will have obesity by 2030, and this will increase medical and other costs to our nation by hundreds of billions of dollars every year. Taking steps to address this crisis 

simply cannot wait. 

Access to Resources for At-Risk Communities 

We know that for a large portion of the population, a key to combatting obesity is 

providing access to healthy, affordable, and culturally relevant foods as well as to 

recreation and fitness facilities. Unfortunately, individuals who live in both rural 

and urban, low-income communities often cannot access these resources safely or 

economically. It is in these same communities where we find disproportionately high 

rates of obesity and other associated conditions, including cardiovascular disease, 

stroke, Type II diabetes, and cancer.4 Initiatives that increase access to healthy living resources in these communities are shown to improve health outcomes, save 

money, and reduce obesity rates in these communities. For example: 

• Studies show that decreasing the number of households that lack access to a 

vehicle and are located in ‘‘food deserts 5’’ by 1 percentage point results in a 

nearly 1 percentage point decrease in the obesity rate in that community. For 

an average county, that translates to 875 fewer individuals with obesity. • Data also suggests that increasing the number of recreation and fitness facilities from 1 per 10,000 people to 2 per 10,000 people would result in a 7 percent 

decrease in the obesity rate (from 29.8 percent to 27.8 percent) in an average 

county, which translates to 1,000 fewer individuals with obesity.6

• When taken together, these modest changes could reduce one county’s medical 

costs by over $5 million—yielding resources that could, in turn, be reinvested 

in those same communities. 

The Role of Tax Policy 

Historically, the federal government has used tax policies to support and incent desired social ends—such as home ownership, building retirement savings and charitable giving. In the same vein, the tax code can be an important policymaking tool 

to drive resources to efforts that will combat obesity and, in doing so, yield measurable net savings for American health and the U.S. economy. A critical place to begin 

is in traditionally underserved communities. 

The idea of utilizing tax policy to improve living conditions and generate economic 

benefits is not foreign to Congress. Indeed, Congress enacted the New Markets Tax 

Credit (NMTC) in 2000 in order to encourage new and targeted investments in lowincome communities. By lowering economic risk to developers and the finance sector, the credit has been profoundly impactful in generating new infrastructure in 

communities across the nation where needs for safe and dignified housing and 

amenities have been dire. The NMTC also had a halo effect in bolstering access to 

healthy-living resources for communities where these investments have occurred; 

between 2003 and 2010, the credit helped finance 49 supermarkets that improved 

access to healthy foods for more than 345,000 Americans, including 197,000 children.7

The NMTC’s beneficial effects for the kind of healthy living needed to prevent and 

treat obesity, while laudable, are somewhat modest. This is hardly a flaw of that 

program, but rather a reminder that as a nation we lack similar policy more explicitly designed to address obesity that resides so disproportionately in the communities served by the NMTC. In fact, the success of the NMTC is a reminder that 

direct, intentional tax policies can and should be utilized to provide incentives for 

investment in communities that suffer disproportionately from obesity and whose 

children are most likely to grow up suffering from this disease and the many medical conditions it brings. 

There are real and focused ways that tax policy can be used to achieve this aim, 

from modifications to the Low-Income Housing Credit that would encourage development projects to plan for areas for recreation and physical activity to expansion 

of the Work Opportunity Tax Credit to draw needed professionals into at-risk communities to engage families in healthy food choices and nutrition and exercise eduVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00059 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
56 

8Trust for America’s Health. F as in Fat: How Obesity Threatens America’s Future 2012. 

Washington, DC: Trust for America’s Health; 2012. Available at: http://healthyamericans.org/ 

assets/files/TFAH2012FasInFatFnlRv.pdf. 

cation. Congress can also use tax policy to incent an array of private interests to 

contribute infrastructure where it is most lacking and, in doing so, give communities 

safe and accessible soccer fields, jogging paths, and even gyms. 

We know from the NMTC and many other tax programs that tax policy can drive 

social change. There is also substantial evidence that well-targeted steps such as 

these to direct tax policy at this national health and economic crisis can produce 

the double benefit of improving health outcomes while simultaneously creating local 

and national savings associated with decreased rates of obesity. Data show that a 

population-wide reduction in body mass index (BMI) of just 5 percent could lead to 

more than $29 billion in health care savings in just 5 years. The same study found 

that the country could save $158 billion over 10 years and $611 billion in 20 years 

with the same BMI reduction percentage.8

CEO–AF urges the Committee to seriously consider tax policy approaches such as 

those outlined above that can lower costs and provided targeted incentives to individuals, businesses, and investors that will result in increased access to healthy lifestyles for Americans living in low-resource, low-income communities. There have 

been many studies that demonstrate the workability of these programs. The challenge now is to apply tax policy approaches to the programs that can be most effective, and in doing so, move the needle on obesity in America’s most underprivileged 

communities. There is hardly an opportunity with benefits as potentially great as 

this. 

We applaud the Senate Finance Committee’s efforts to examine evidence-based models that can help vulnerable families and at-risk individuals and we hope to work 

with the Committee and its leaders to further assess and advance tax policies to 

combat the obesity epidemic. We appreciate the opportunity to submit this statement for the record. 

CENTER FOR THE STUDY OF SOCIAL POLICY

1575 Eye Street, NW • Suite 500 • Washington, DC 20005 • p 202–371–1565 

50 Broadway • Suite 1504 • New York, NY 10004 • p 212–979–2369 

www.cssp.org 

May 10, 2016 

‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ 

The Center for the Study of Social Policy (CCSP) is pleased to provide a statement 

for the record on the May 10, 2016 Senate Finance Committee hearing ‘‘Can 

Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ 

First, we thank the Committee for taking up this important discussion on the use 

of evidence-based practices in improving outcomes for vulnerable children and families involved in the child welfare system and we appreciate the opportunity to provide comment on this matter. With limited public and private resources and in order 

to best meet the needs of families and children, it is imperative that funds be invested in programs that credibly demonstrate a positive impact on child and family 

well-being and that robust evidence of success is used in developing new strategies 

for families facing multiple barriers. However, simply funding or designing programs based on currently available evidence is not sufficient to the task. Stable financing must be available to propel and support innovation in the development and 

implementation of preventative support programs for children and families with 

multiple and complex needs—especially if we are to make progress to improve wellbeing and address current challenges faced by families involved with child welfare 

systems. Programs must be implemented with a clear attention to measuring and 

understanding results, using that information to make well-conceived adaptations 

and mid-course corrections when programs fall short of achieving desired results 

and insuring that processes are in place for continuous learning and accountability 

to funders, taxpayers and service recipients. 

57 

1Schorr, L., Farrow, F., and Sparrow, J. (2014). An Evidence Framework to Improve Results. 

2014 Harold Richman Public Policy Symposium: The Future of Evidence. Center for the Study 

of Social Policy. Available at http://www.cssp.org/policy/evidence/AN-EVIDENCE-FRAMEWORK-TO-IMPROVE-RESULTS.pdf. 

The remainder of our statement will focus on suggested definitions, strategies and 

proposed areas of concentration based on our extensive experiences helping child 

welfare and other public human services systems improve their work and achieve 

improved outcomes for the children and families in their care as well as our leading 

role as the founding member of Friends of Evidence—a group of distinguished leaders across diverse fields, disciplines and sectors—concerned with the limitations of 

prevailing approaches to obtaining evidence and focused on defining and promoting 

more effective approaches. We specifically address (1) the need for an inclusive definition of evidence supported by multiple rigorous assessment and evaluation methods; (2) the need to support disciplined plans for rigorous learning and innovation 

through continuous quality improvement (CQI) processes; (3) attention to the impacts of evidence requirements on the necessity of funding programs to advance equity; and (4) making the best use of taxpayers’ dollars by investing in innovations 

that support the needs of vulnerable populations. 

A Comprehensive Definition of Evidence Supported by Multiple Rigorous 

Methods 

CSSP recognizes that the use of evidence of effectiveness is important for both the 

selection and implementation of programs aimed at improving outcomes for vulnerable populations. The definition of what constitutes acceptable evidence is critically 

important. The recent federal budget included a statement from the Office of Budget 

and Management (OMB) that offers the following definition, ‘‘Broadly speaking, ‘evidence’ is the available body of facts or information indicating whether a belief or 

proposition is true or valid.’’ OMB states that: ‘‘The best government programs use 

a broad range of analytical and management tools, which collectively comprise an 

‘evidence infrastructure’ to learn what works (and what does not) for whom and 

under what circumstances, as well as improve results.’’ We support this definition. 

Evidence is derived from several sources: program management and monitoring as 

well as formal evaluations that employ a range of data collection and analytical 

methods and research that has relevance to achieving desired results. In addition, 

the rigor and credibility of evidence is not established by a single evaluation method. It is determined by the use of multiple methods appropriately matched to what 

we want to learn and need to know. 

Current reliance on Randomized Control Trials (RCTs) as the primary method for 

definitive evidence about ‘‘what works’’ can answer certain questions, but it does not 

answer all the questions decision-makers need to consider. The type of evidence acquired through an RCT may establish that a program has worked for some people, 

on average, in a particular context compared to those in a control group who did 

not receive the intervention. This however, is only a small part of the information 

a decision-maker would like to have in choosing whether to adopt and/or scale-up 

a program. In reality, what often works for one client or community may not work 

for another unless adaptations are made to account for variables such as culture, 

race or location. Decision-makers need the evidence to answer such questions as: 

‘‘Will it work here, in my context for my citizenry?’’ and ‘‘What is needed to make 

it work?’’ Furthermore, most evaluation findings are rarely definitive, revealing 

mixed results that typically require additional testing and evaluation. Consequently, 

the questions of most interest to policymakers and of benefit to children and families can go unanswered when only relying on an RCT for answers. As a result of 

these issues, we believe that a more narrowly constructed definition of evidence, 

driven by a single methodology or data source, has the potential to stymie innovation, limit which programs can receive funding for implementation and may end up 

increasing programming costs as decision-makers attempt to make an evidencebased program fit the problem they are addressing.1

A Disciplined Plan for Learning, Accountability and Innovation Through a 

Rigorous Continuous Quality Improvement (CQI) Process 

Generating evidence should not be left solely to outside evaluators, and timing of 

corrective action should not have to wait for or be dependent on an evaluator’s final 

report. Initiative staff—at all organizational levels—play a critical role in generating 

reliable and valid evidence and ensuring implementation integrity in a timely manner. Innovation must be accompanied by an organizational focus on results and a 

commitment to learning what is working and what is not and using the learning 

58 

2 Initial funding for this program came from the Children’s Bureau through the Northeast 

and Caribbean Implementation Center. 3 Also referred to as Social Impact Bonds, Social Impact Partnerships, or Pay for Success. 

to hold themselves accountable to funders and beneficiaries alike. The learning must 

be used to facilitate program redesign if necessary or identify additional necessary 

evidence for decision-making. This process, often referred to as Continuous Quality 

Improvement (CQI), is crucial to understanding what truly works for vulnerable 

groups and is an important process for improving programs, even those that are 

considered evidence-based. 

As evidence-based programs are implemented with different populations, engagement in a rigorous CQI process becomes key to ensuring that the model is having 

the intended impact for children and families. CQI can ensure practice integrity 

when fidelity measures may not be appropriate or they have not yet been designed. 

A robust evidence generating infrastructure must include both CQI and external 

evaluation, yet creating this infrastructure often does not receive adequate attention 

of time and resources. Internal CQI capacity requires a culture of curiosity and 

many of the same analytical skills employed by external evaluators. While CQI is 

a discipline, it should not be a rote process installed to be compliant with a mandate. A robust approach to CQI requires measurement of both the quantity and the 

quality of services delivered, the impact of services on child and family outcomes 

and well-being and the effectiveness of processes and systems. For example, the 

New Jersey Department of Children and Families (DCF) implemented a competitive 

‘‘Data Fellows Program’’ that provided 100 middle-management DCF staff with the 

opportunity to utilize data to support improved case practice and outcomes for the 

children and families they serve in their areas or local offices all while developing 

skills in the areas of presenting information, for management and decision-making, 

leadership, and team building.2 This program demonstrates the DCF’s commitment 

to managing by data and using it as a catalyst for continuous quality improvement. 

While New Jersey took the initiative to invest in workforce capacity building, other 

organizations may need incentives and support to build the processes and staff capacities required by such a robust CQI process. 

Funding Innovation to Advance Equity 

Existing funding streams often require strict adherence to program and practice 

protocols. Adaptations to a chosen model are typically not allowed if the intervention 

wants to receive continued funding and designation as an evidence-based program. 

However, this requirement may produce unintended inequities as a result of the 

population—including race, gender, and cultural characteristics—with whom the 

program was tested and impacts determined. Meeting the needs of those families 

facing the greatest barriers in any given community may require adaptions to the 

interventions that are specific to the populations being served. Moreover in some 

cases, the evidence-building evaluation was conducted over 20 years ago with a population with different characteristics and facing different challenges than those who 

would benefit from the program today. Consequently, if adaptation is not allowed, 

certain populations and communities may not be able to benefit from an evidencebased program. For example, because pregnant adolescents in foster care often do 

not disclose their pregnancy until their second or third trimester, they become ineligible for evidence-based programs such as Nurse Family Partnerships that only enroll mothers in their first trimester. Yet these young women are in critical need of 

the knowledge and caring relationship a Nurse Family Partner can provide. 

Paying for innovative programs or investing in adaptations of an evidence-based 

program for a new population—like a Nurse Family Partnership model for young 

women in foster care who disclose pregnancy after the first trimester—often requires large upfront costs, making them unattractive to legislators and policymakers. However, this is one example of an opportunity for investment and innovation that may be attractive to those in the private sector who could employ a Social 

Impact Financing (SIF) 3 or Pay for Success strategy—which have been proposed as 

an alternative funding approach. 

In order for these funding strategies to have the desired impact of providing financial support for innovation and adaptation, it is critical to understand what government incentives will be used to attract private interest. In an effort to maximize investments, we urge the Committee to consider incentives that would support research, development, and evaluation that reflect a broader definition of evidence. 

Currently, the majority of SIF and Pay for Success models employ RCTs as the 

methodology for evaluation and verification of results achieved. While RCTs are one 

59 

4Olsen, L., Grossmann, C., and McGinnis, J.M. (2011). Learning What Works: Infrastructure 

Required for Comparative Effectiveness Research: Workshop Summary. Available at http:// 

www.ncbi.nlm.nih.gov/books/NBK64787/pdf/Bookshelf_NBK64787.pdf. 

form of evaluation, there are benefits to utilizing different methodologies when testing a new approach. As previously mentioned, programs evaluated through a RCT 

generally have little ability to adapt during testing. By limiting the ability for such 

adaptation, the implementation is also risking a poor return on investment since 

any lessons learned cannot be applied during the course of the evaluation. In the 

private sector, investors do not expect fund managers to continue doing the same 

thing if they are losing money, or if it is shown they are not generating as much 

revenue as they could—the ability to adapt is critical. Lastly, from a cost benefit 

perspective, a broader range of methods can often produce credible evidence of initiative results carried out in a less costly manner than RCTs without compromising 

integrity.4 By supporting a broader range of evidence-building methods, investors 

would also have the opportunity for more timely innovation and adaptation in communities where families face multiple barriers. 

The Best Use of Taxpayers’ Dollars Includes Investing in Innovations That 

Support the Needs of Vulnerable Populations 

Credible evaluation methodologies that align meaningful solutions with problems 

and a comprehensive evidence generating infrastructure are the most responsible 

way to invest taxpayer dollars. This is particularly important when striving for positive outcomes for populations that are disproportionately impacted by child welfare 

systems and where an RCT alone may not be the definitive evaluation strategy. 

Choosing to rely solely on SIF or Pay for Success models to fund innovative strategies for these populations can disproportionately impact those facing the compounding effects of race, class, gender and sexual orientation as marginalized groups 

would be competing for funder interest. Additionally, it must be noted that since private investors, rather than the government, absorb the financial risk in a SIF or 

Pay for Success approach, reliance on this model to fund innovations could prove 

to be an unstable funding source—which is particularly problematic when families 

facing multiple barriers are precisely the families child welfare systems are aiming 

to serve. 

We live in an ever more complex world and the challenges faced by our most vulnerable families are also growing more complex. Proven programs from 20 years ago 

are insufficient to meet today’s challenges and to take advantage of today’s knowledge. Continued adaptation and innovation is essential. But, these efforts must be 

disciplined and generate evidence that decision-makers can readily use to replicate 

success or infuse existing programs with new ideas. Using taxpayer dollars to invest 

in research, development, and rigorous evaluation using multiple methods is a good 

investment. A positive opportunity for federal investment is to support long term 

research-practice partnerships and technical assistance on the use of continuous improvement practices and the facilitation of partnerships with external evaluators. 

CSSP commends the Senate Finance Committee for addressing this critical issue. 

We thank you for your continued commitment to improving the well-being of vulnerable populations coming into contact with the child welfare system. 

If you have any questions, please don’t hesitate to contact Megan Martin, (202) 371– 

1565; megan.martin@cssp.org and thank you in advance for consideration of our 

comments and recommendations. 

60 

CHILD TRENDS

7315 Wisconsin Avenue, Suite 1200W 

Bethesda, MD 20814 

www.childtrends.org 

Statement of Carol C. Emig, President 

‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ 

May 10, 2016 

Introduction 

On behalf of Child Trends, a nonpartisan, nonprofit research organization focused 

exclusively on improving the lives and prospects of children, youth, and their families, we would like to extend our thanks to the Senate Committee on Finance for 

holding the hearing on May 10, 2016 on evidence based practices. We appreciate 

their attention to such an important issue and the opportunity to participate in that 

conversation. 

We applaud the recent efforts of the Congress in recognizing and supporting 

evidence-based work to improve child well-being through legislation such as the 

Every Student Succeeds Act, the Investing in Innovation Fund (i3), and H.R. 5170 

currently in mark up. Child Trends brings 37 years of experience conducting research about children, families, and the programs that serve them. A major component of our work involves building an evidence base around ‘‘what works’’ for our 

most vulnerable children and families. With this experience, we are grateful for the 

chance to describe the powerful role that an evidence base can play in improving 

outcomes for children and families, and share some of the lessons we’ve learned 

through our own experience evaluating programs and services. 

Building the Evidence Base is Valuable, Important Work 

The hearing on May 10, 2016, explored the question: ‘‘Can Evidence-Based Practices 

Improve Outcomes for Vulnerable Individuals and Families?’’ As researchers and 

evaluators, we wholeheartedly answer ‘‘yes.’’ 

Child Trends’ own What Works database houses data on nearly 800 programs that 

have had at least one randomized, intent-to-treat evaluation to assess child or youth 

outcomes related to education, life skills, and social/emotional, mental, physical, behavioral, or reproductive health. Importantly, this database includes programs that 

do no work, as well as those with positive impacts. In addition to a searchable catalogue of programs, we have written numerous ‘‘What Works’’ syntheses—on various 

populations—summarizing what the evidence base can teach us about ‘‘what works’’ 

for populations (such as Latino or black children and adolescents, and older youth); 

for program outcomes (such as reducing problem behaviors in early childhood and 

preventing bullying); and for program approach (such as mentoring and home visiting). 

Another example springs from the work of the Teen Pregnancy Prevention Program 

(TPP) administered by the Office of Adolescent Health (OAH). OAH houses a 

searchable database of three dozen evidence based TPP programs—all of which have 

had at least one program evaluation and have shown a positive impact on preventing 

teen pregnancies, sexually transmitted infections, or sexual risk behaviors. The twotiered grant program provides funds for grantees who replicate evidence-based models and additional evaluations, as well as grants to develop and test new and innovative strategies to prevent teen pregnancy. 

We also work closely with several child welfare agencies, evaluating work funded 

through Diligent Recruitment Grants, awarded by the Children’s Bureau. As the 

evaluator, we learned valuable lessons about ‘‘what works’’ for children and families 

who came into contact with the child welfare system, specifically around strategies 

to support foster families in their critical, yet challenging work. 

However, as enthusiastically as we stand behind the need to build and strengthen 

the evidence base, we also believe it is important to share four cautions with you 

today. We hope that these inform your work as you promote and mark up legislation 

like H.R. 5170 and the Families First Act. 

(1) Although rigorous evaluations are powerful tools in the evidence toolbox, becoming an evidence-based practice is a process. 

61 

As shown in the figure below, Child Trends views the process of becoming an 

evidence-based program as a critical, albeit under-appreciated, effort that requires 

several years of investment. The process begins with a needs assessment to identify 

the issues faced by a community; and the information from this assessment should 

then inform identification of the population that will be the focus of intervention efforts. Next it is critical to identify the intervention program or services, to develop 

a theory of change, and to formulate a logic model that specifies the intended inputs, outputs, and outcomes. 

Having completed these steps with staff, board, and stakeholders, a performance 

management system can be developed so that program inputs, outputs, and outcomes can be tracked and reported. The goal is to improve the program and confirm 

that it is achieving its intended outcomes before engaging in a formal evaluation. 

Performance management is the evaluation ‘‘workhorse’’ and, as such, it is crucial 

to give it sufficient time and attention to make sure that the goals of the intervention are being met. Once that is assured, it may be time to conduct a formal 

evaluation—the race horse. Either a quasi-experimental evaluation or a randomassignment evaluation may be appropriate; but, in either case, it is also critical to 

conduct an implementation evaluation. And it is essential to continue performance 

management work throughout the life of the intervention. 

Recommendations 

– Recognize and support programs and practices that are at other stages of the 

evidence-based continuum, and not limit support to randomized-controlled trials 

(RCTs). 

– Encourage and support programs and services to develop and use strong performance management techniques to promote continuous quality improvement 

in their work. Using regular data analysis and review can help programs not 

ready for a rigorous evaluation still understand pieces of ‘‘what works’’ for their 

clients. 

(2) Protect against potential unintended consequences of building an evidence base. 

In our role as evaluators and research partners to agencies, programs, and initiatives that support children and families, we’ve spent a great deal of time working 

closely with the people who implement programs and interventions. With that experience, we’ve learned that a close tie between evaluation results and funding 

streams can raise fears and stifle innovation. This type of reaction runs counter to 

the goals of initiatives like ‘‘Pay for Success,’’ which aim to open the field to new 

ideas and creative problem solving. 


051016.001
62 

We believe that the tiered approaches of Home Visiting and TPP can continue to 

motivate the field to try new approaches. As described above, through the TPP 

grants, the Office of Adolescent Health provides funds to both programs that are 

replicating evidence-based strategies and those who are testing new innovative 

strategies in communities with high teen birth rates. Those grantees working on innovative strategies also receive technical assistance from other federal agencies. 

Recommendations 

– Continue to support a tiered approach towards supporting programs both implementing evidence-based practices and programs using research to inform new 

strategies that may be promising. 

– When working with programs and agencies, generate excitement over possibilities in growing our understanding of ‘‘what works’’ and creating stronger and 

better programs, rather than focusing the conversation on cutting programs 

that may be struggling. Ensure that technical assistance is available to help 

those programs do better. 

(3) Challenges can arise in sharing the messages from evaluations broadly. 

As the federal government and states move forward with a stronger emphasis on 

using evidence-based program and practices, we need to prioritize sharing ‘‘what 

works’’ with decisionmakers at all levels. Policymakers, state agency leaders, and 

program staff need to know ‘‘what works’’ for their target populations and under 

what circumstances. Perhaps even more valuable, leaders need to be aware of what 

we don’t know yet, so they can bring a full understanding of potential solutions as 

they approach challenges within their communities. In times when states and localities face fiscal challenges, it is particularly important that information about ‘‘what 

works’’ is shared with all stakeholders. 

Although an important goal, we know that evidence can sometimes be buried. Generally, researchers and academics are incentivized to write for other researchers, in 

peer-reviewed articles. Such articles are not easy for laypeople to locate or access, 

and may be too technical to fit the needs of local stakeholders. Findings, implications, and limitations need to be clearly described in ways that are useful to state 

and local decisionmakers and program implementers. 

Researchers who have conducted evaluations that have null or negative findings, 

and the programs that were evaluated, may be unwilling to share those findings 

with a broader audience. But much can be learned from what doesn’t work—and 

that evidence should be shared widely to prevent other programs from making the 

same mistakes. 

Recommendations 

– Encourage and fund researchers to share their findings widely, through dissemination channels beyond peer-reviewed articles and researcher conferences. 

– Help with the translation of research into plain language for communication to 

the various stakeholder groups of interest, and contextualize the findings. The 

message around ‘‘what works’’ in an educational setting may be different for a 

policymaker than for a teacher. 

(4) Support broad implementation of successful strategies and programs. 

In the same way that our work does not begin with a rigorous evaluation, it does 

not end with one. To ensure that a program achieves the intended results—also 

known as fidelity—work must be done around implementation. We work closely 

with programs that serve children, youth, and families, helping them improve their 

quality and achieve their intended outcomes. We also support their use of data to 

better understand what is working, or not working, for them. 

In addition to being an important piece of the research arrow, it’s also an important 

component of this policy conversation. Legislation or regulations that promote or require the use of evidence-based programs or practices operate under an assumption 

that those programs and practices lead to positive outcomes for individuals. However, if improperly implemented, the positive outcomes may be altered or, worse yet, 

may result in negative outcomes. 

Recommendations 

– In legislation and funding, recognize that the work isn’t over when rigorous 

evaluations are conducted and positive outcomes are achieved. Fidelity of implementation needs to be monitored. Also, replication is important, because a proVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00066 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
63 

gram that works in one community may not achieve the same results in another setting. 

– Support new programs as they implement evidence-based practices and existing 

programs as they begin to scale up by facilitating technical assistance and supporting additional evaluation as needed. 

Final Comments 

We appreciate the Committee’s important work to bring attention to building the 

evidence base for the programs and practices that support our country’s most vulnerable children and families, We would be happy to provide the Committee with 

further research and analysis should there be a need. 

CORPORATION FOR SUPPORTIVE HOUSING (CSH) 

Testimony by Andy McMahon 

Managing Director of Government Affairs and Innovation 

Contact: Eva Wingren 

Phone: 202–715–3985 ext. 70 

Email: eva.wingren@csh.org 

CSH’s mission is to advance solutions that use housing as a platform for services 

to improve the lives of the most vulnerable people, maximize public resources and 

build healthy communities. We provide financing, technical assistance and consulting, and policy leadership at the local, state, and national levels to incorporate 

evidence based and promising practices into investments in affordable and supportive housing. 

Over the last several years, CSH has pioneered effective strategies for addressing 

the needs of families with high needs and complex child welfare cases by aligning 

the affordable housing and child welfare systems. We are working extensively with 

the Administration for Children, Youth, and Families, as well as child welfare systems across the country, to move towards a model that keeps families together. We 

appreciate the opportunity to share the lessons we have learned from this work and 

hope that you will include them in legislation around the use of evidence based 

practices and social impact financing to address the needs of vulnerable individuals 

and families. 

Additionally, CSH sees Pay for Success (PFS) as a promising and important tool for 

the creation of supportive housing targeted to vulnerable populations. CSH is involved in more than 14 social impact investments at various stages of completion. 

We play a variety of roles, including feasibility technical assistance provider, transaction structurer, investor and project manager. CSH is uniquely positioned to support government and social impact investors in executing social impact investment 

partnerships, given our deep expertise designing, implementing and evaluating initiatives across the country aimed at addressing the needs of these target populations coupled with our role as a community development financial institution. 

With this background, we respectfully offer our reflections and recommendations as 

the Committee explores opportunities for employing evidence-based practices to improve outcomes for vulnerable individuals and families. 

Pay for Success 

Federal investment in PFS structures has the potential to greatly increase the scale 

at which these investments can be made. PFS projects that facilitate systems 

change and program development currently typically require additional funding for 

the setup, intermediary, and evaluation work required. 

CSH is an awardee of the Social Innovation Fund’s Pay for Success initiative 

through the Corporation for National and Community Service (CNCS). To date we 

have selected 10 communities through 2 rounds of competition where we are working to determine the feasibility of PFS as a tool to scale supportive housing for vulnerable populations. This work includes using data to define the target population 

for a potential PFS transaction, conducting cost benefit analysis to understand potential cost avoidance and value creation if members of the target population gained 

access to supportive housing, working with stakeholders to define project outcomes 

and success, and solidifying commitments from key partners such as end payers 

who would make payments based on success. 

64 

In our most recent round of competition, we selected three communities that are focusing their PFS exploration on populations of persons who are super utilizers of 

health care, criminal justice, or other crisis resources. In communities across the 

country, there is a cohort of people who cycle between emergency rooms, hospitals, 

jails, detox facilities and homeless shelters, at enormous expense to these systems. 

We also selected the Oklahoma State Department of Mental Health and Substance 

Abuse Services (ODMHSAS) as a recipient of technical assistance focused on determining the feasibility of a PFS project focused on creating supportive housing for 

young adults (18–25) with mental health, substance use, or co-occurring disorders, 

lacking stable housing or experiencing homelessness or chronic homelessness. The 

project in Oklahoma will place a special emphasis on youth transitioning out of foster care and/or the juvenile justice system. 

We also see great potential for PFS to pair well with a target population of families 

with high utilization of the child welfare systems and histories of homelessness. The 

PFS model offers an opportunity to create supportive housing for families, helping 

them gain stability, increase family functioning, and improve child and adult wellbeing, across a range of outcome areas and measures. Federal funding to kick-start 

PFS projects would have a tremendous impact on further developing the potential 

of PFS as a tool to improve outcomes for families and youth. 

Social Innovation Fund funding has always been highly competitive, and CSH received more than 60 applications in our two rounds of competition to date. We are 

confident that the competitive nature of the funding proposed by Congress will drive 

high quality projects that address critical social issues, including improving outcomes for vulnerable families. 

In addition to advancing the PFS industry, the federal government could also use 

PFS is the opportunity to capture federal savings. Effective models exist for 

repurposing federal expenditures on programs used by low income people to achieve 

better outcomes. Supportive housing is an evidence based intervention that saves 

money in the health care, criminal justice, and emergency homelessness systems— 

and we are exploring the extent of possible savings in child welfare, education, and 

other programs that target vulnerable families. 

CSH’s Focus on Vulnerable Families 

Supportive housing harnesses the resources of multiple public agencies and service 

providers to offer whole-family care, healing parents and children to create a safer 

environment so they can stay together and thrive in their own home. 

Homeless families who frequently encounter the child welfare system are one of our 

target groups for PFS projects because of the poor outcomes for the adults and children in these families and the high costs they incur to multiple systems. In fact, 

expenditures associated with these families are seven times those associated with 

non-frequently-encountered families (Loman and Siegel, 2006). Costs associated 

with child maltreatment are extensive and impact nearly every social service sector 

from child welfare to health care to the criminal justice system. According to a report by Prevent Child Abuse America (2008) the direct costs associated with families 

who are involved in the child welfare system is staggering: $33.1 billon per year. 

The largest cost associated with these families is the child welfare system at $25.4 

billion/year. Other direct costs include hospitalization/treatment of injuries ($6.6 billion) and mental health care ($1.1 million). Law enforcement intervention is estimated at $33.3 million per year. 

The needs of this subset of families and children are longer term and require an 

intervention that is focused on acquiring new skills that allow them to manage their 

chronic challenges like any chronic health challenge. The costs to children in these 

families are too great to continue to rely on overburdened systems and short term 

solutions. By creating the housing assistance, resources, and supports needed for 

parents and children to grow together in safe, stable homes, we are reducing the 

need for child welfare system expenditures. We are building strong and compelling 

evidence of supportive housing’s potential as a cost-effective tool for improving family and child outcomes while addressing avoidable family separations and child removals. 

In many circumstances families staying together means better lives for children, 

whereas forced separation and foster care placement can have devastating consequences. Although limited national data exists regarding the overlap between 

family homelessness and involvement with the child welfare system, many studies 

have shown a link between the two. A study found that as many as 49% of the sample of children in foster care in one California county were removed from homeless 

65 

or unstably housed parents (Zlotnick, Kronstadt, and Klee, 1998). Research by Partners for Our Children in Washington State indicates that 37% of the families with 

a child who experienced an out-of-home placement were homeless in the 12 months 

prior to the loss of custody (Courtney, 2010). In addition, child welfare involvement 

is highly predictive of homelessness in adulthood; 40% of adults experiencing homelessness indicate they were once in foster care. 

The U.S. Department of Health and Human Services Administration for Children 

Youth and Families (ACYF) bolstered by promising results from CSH’s Keeping 

Families Together (KFT) and other supportive housing initiatives (Swann-Jackson, 

2010), assembled a $35 million 5-year public-private partnership with four philanthropic organizations to evaluate the impact of KFT-modeled supportive housing initiatives in five communities. This demonstration represents the first federal investment specifically focused on reducing child welfare system involvement by supporting the whole family with affordable housing and tailored services. It reflects 

our beliefs that supportive housing holds tremendous promise for breaking the cycle 

of homelessness, parental behavioral health challenges, child neglect, and child removal among the highest-need families. Supportive housing has the potential to 

change the life trajectory of vulnerable children. 

The five federal grantees in the demonstration are located in Broward County, 

FL; Cedar Rapids, IA; Memphis, TN; San Francisco, CA; and the State of 

Connecticut and together are striving to provide supportive housing to more than 

400 families with children at risk of, or already in, foster care placement. 

Three years into the 5-year demonstration, we are seeing results that indicate supportive housing is making a real difference in the lives of vulnerable, fragile families. Here is some of what we know so far: 

• Sites have successfully housed over 300 families. 

• Families are staying housed with high rates of housing stability—roughly 91%. 

Housing stability has been a key success metric in all other PFS supportive 

housing transactions to date. 

• Anecdotally, we know that there have been high rates of family reunification 

and foster care avoidance. 

The Urban Institute is conducting a Randomized Control Trial (RCT) across sites. 

Specifically, their research study is accessing child welfare and homeless system 

administrative and survey data to examine the following: 

• Targeting and Prediction Model: How is supportive housing being targeted 

in each site to the highest-need families? How can practitioners use quantitative predictors in assessment tools to better target and prioritize high-need 

families? How do we gather high quality data from child welfare and homeless 

system administrative data, referral forms and the family survey? 

• Process and Implementation Study: What are the basic housing and services components of the program model and how do these differ across sites? Has 

the program been implemented according to each site’s plan? What are the 

major implementation challenges? Does supportive housing lead to improved, 

sustainable coordination between the child welfare agency and public housing 

agency/homeless service agency? How do programs and partnerships change 

over time? Annual or semiannual site visits and key informant interviews, review of local evaluation process studies 

• Impact Analysis: What impact does the program model have on housing stability, parenting skills, family stability, parent and child well-being, and child 

welfare involvement? Child welfare and homeless system administrative data, 

family survey data 

• Cost Study: What is the cost-benefit across different systems and to society? 

Other places are financing family supportive housing in unique ways, including social impact investments. We worked with New Jersey and New Mexico to re-direct 

TANF, child welfare, and other state dollars to family supportive housing. Cuyahoga 

County, Ohio is using a similar model in a Pay for Success transaction. 

Promising Practices 

We are actively working with the Departments of Housing and Urban Development 

and Health and Human Services to create robust guidance explaining how to use 

existing dollars in such investments. Actions such as coordinating data across systems and removing elective screening criteria from housing resources will remove 

barriers to future PFS replication. Guidance will help governments integrate successful PFS projects into their regular budgets after the investment period. 

66 

Through our work, systems-level partnerships and strategies are emerging to better 

coordinate and serve vulnerable families with complex needs. We recommend that 

PFS transactions dealing with vulnerable families keep these lessons in mind when 

structuring their programs. 

• Use of cross-systems data to target families most in need: Limited data 

exists regarding the links between family homelessness and involvement with 

the child welfare system. To make the best use of limited resources, sites needed to create data collection processes that used cross-system data to develop a 

profile of those most in need of supportive housing and then target them accordingly. 

• Establishing multi-agency teams to coordinate services to families: Stabilizing the most vulnerable families requires tailored access to services as identified by the families themselves. This could involve a variety of partners, from 

the landlord to a behavioral health counselor to the family’s own support network. The demonstration sites are utilizing a family-engagement approach to 

meet families where they are at, and to coordinate the family and multiple service partners to achieve the goals identified by child welfare case plans and the 

family. 

• Creative housing partnerships: Working partnerships between state and 

local housing agencies, such as Public Housing Authorities, and local child welfare agencies have been strengthened and are critical to our success so far. Several sites have changed their PHA administrative plans to remove barriers for 

high need families. Housing subsidies are an allowed use of PFS funds, but PFS 

is typically only part of the overall budget, so other housing subsidies are needed. 

• Adopting a Housing First lens: Housing First is an approach to quickly and 

successfully connect families experiencing homelessness to permanent housing 

without preconditions and barriers to entry, such as sobriety, treatment or service participation requirements. Supportive services are offered to maximize 

housing stability and prevent returns to homelessness as opposed to addressing 

predetermined treatment goals prior to permanent housing entry. Housing First 

models have been highly effective in ending homelessness and addressing high 

service needs. In a child welfare context, housing stability should be the 

first step in reunification, not the last step. 

Recommendations to the Committee 

Based on our experience with PFS and with vulnerable populations, we recommend 

that the Committee include the following elements in social investment legislation: 

• Fund applicants to work with state and federal partners to build the data systems necessary to support better performance management and evidence building. The availability of data has been critical to the success of all of our PFS 

initiatives so far, particularly high quality data from multiple systems that is 

cross-referenced to identify high users of systems, understand their needs, and 

measure progress in serving them. 

• Make sure that PFS projects are serving the most vulnerable households. PFS 

is such a powerful tool for solving complex social problems because the most 

vulnerable households are often also the highest users of services and therefore 

have the most potential for savings. However, such households may face complex challenges that make achieving specified outcomes more difficult, so applicants may experience resistance to serving high need households. The Committee should request PFS evaluations to include an assessment of the participant selection criteria and fidelity to the model. 

• Make the evidence based standard be achievable and relevant to the intervention. 

As stated by several of the panelists in the hearing, the insights into what 

works to address social problems should not come solely from PFS but should 

also be paired with a robust federal research agenda. The goals of PFS and the 

goals of a research agenda are not always aligned, since typically payback is 

tied to one or two of the many possible relevant outcome measures. A base level 

of research is frequently required in order to attract PFS investors. Conversely, 

at some point the evidence base will be established and there will be diminishing returns on investments in rigorous evaluation. The Committee should 

strive to balance developing new approaches, testing promising programs at 

some scale, and expanding programs with the strongest evidence. They should 

also require high quality outcome measures that are appropriate to the project 

and actually measure success. 

67 

• Consider projects that might otherwise offer valuable and readily quantifiable 

returns to participants and society at large in addition to those that produce 

cashable government savings. This includes considering allowing for value that 

might accrue over a longer timeframe than the typical PFS transaction length 

of 5–7 years. CSH also recommends considering approaches that monetize social 

benefits. CSH is also interested in quantifying the generational impacts of 

avoiding family homelessness. The legislation should also allow for the consideration and testing of alternative funding models when PFS financing does not 

appear to be feasible or the best way to implement an intervention in a given 

community. 

• Scale up PFS by building on previous deal structures, while also allowing for 

specific initiatives to adapt its model to best fit the needs of a particular target 

population and community. As several panelists stated, broad latitude to partners allows the private market aspects of PFS to work, while still insisting on 

rigorous evidence and payment terms that are fair to both taxpayers and investors. CSH is experienced with providing technical assistance using a cohort 

model, where numerous places were tackling the same problem. While the cohort offered valuable opportunities for learning from others’ challenges, the experience also illustrated that tailoring deals to the local context is critical for 

their success. 

• Make sure that federal partners are engaged in defining the relevant federal savings. The value of the proposed legislation is that for the first time federal funds 

can be used to support project costs—essentially allowing the Treasury Department to be a financing party in SIB deals, providing dollars to state and local 

entities so that they may in turn pay back investors if an initiative is found 

to be effective by a rigorous third-party evaluation. CSH recommends that the 

Committee charge the relevant federal agencies with defining areas of federal 

savings upfront, so that potential projects can evaluate federal payments as a 

revenue stream going forward. 

• Incorporate successful PFS projects into the relevant ongoing federal agency 

budgets by directly investing in scaling and sustaining proven interventions. 

PFS transactions are complex and have associated costs. Once the evidence base 

is established, there is a diminishing return on further investments in research 

and evaluation. Moreover, as a program gets refined to the point where it is 

no longer significantly risky, it makes more sense to be provided at scale by 

government rather than paying a risk premium to investors. 

Conclusion 

Having been an integral part of the development of the Pay for Success industry, 

CSH applauds the Finance Committee for lifting it up as a promising tool. In this 

limited funding environment, the Pay for Success model offers a win-win way to get 

better outcomes from public expenditures. We look forward to working together to 

support more child welfare and supportive housing partnerships in the future. 

References 

Courtney, M. (2010). What are we learning from the SBC evaluation? Presentation 

for House Early Learning and Children’s Services Committee. Accessed at http:// 

www.partnersforourchildren.org/pocweb/userfiles/Mark%20SBC%20jan%2014%20 

leg%20presentation.pdf. 

Loman, L.A., and Siegel, G.L. (2006). Minnesota Alternative Response Evaluation: 

Final Report. St. Louis, MO: Institute of Applied Research. 

Prevent Child Abuse America (2008). Research Spotlight on Success: Healthy Families America Promotes Child Health and Development. Available online at: http:// 

www.healthyfamiliesamerica.org/downloads/HFA_Developement08.pdf. 

Swann-Jackson, R., Tapper, D., and Fields, A. (2010). Keeping Families Together: An 

Evaluation of the Implementation and Outcomes of a Pilot Supportive Housing 

Model for Families Involved in the Child Welfare System. New York: Metis Associates. 

Zlotnick, C., Kronstadt, D., and Klee, L. (1998). ‘‘Foster care children and family 

homelessness.’’ American Journal of Public Health, 88: 1368–1370. 

68 

INSTITUTE FOR CHILD SUCCESS

102 Edinburgh Ct., Greenville, SC 29607 

https://www.instituteforchildsuccess.org/ 

Comments for the Record by Bryan Boroughs 

General Counsel and Director of Legislative Affairs 

Introduction 

The Institute for Child Success is excited by the continuing progress in Congress 

regarding Pay for Success financing models (sometimes called Social Impact Bonds) 

that can advance the well-being of young children and their families. We thank 

Chairman Hatch for holding this hearing, and both the Chairman and Senator Bennet for their leadership on S. 1089. 

The Institute for Child Success respectfully submits the following written comments 

to the hearing record for your consideration. In these comments, we begin with an 

overview of our perspective on the benefits of Pay for Success financing. We then 

discuss the substantial benefits of federal involvement, the reasons that legislation 

is necessary for meaningful federal engagement, and the ways in which S. 1089 responds to that need. 

Though both this hearing and S. 1089 deal with a broader array of Pay for Success 

or Pay for Performance tools, and the Institute for Child Success is generally supportive of those tools, we limit our comments here to the model that is sometimes 

called ‘‘Social Impact Bonds’’ or Pay for Success Financing. 

Benefits of Pay for Success Financing (or, Social Impact Bonds) 

Pay for Success financing is a model that can help effective interventions scale up 

to improve outcomes for young children and their families, while reducing or eliminating financial risks to the taxpayers. The fundamental structure is well known 

to many, so we will only provide a very brief overview here. That most basic theoretical structure involves four pieces: 

• An intervention that has been tested, and has demonstrated that it reliably produces outcomes; 

• Investors who provide the upfront capital required to bring the intervention up 

to a larger scale; 

• A government entity that is interested in paying for those outcomes—sometimes 

using funds saved as a result of those outcomes—if the agreed-upon success 

measures are achieved; and 

• An independent evaluator that determines whether the intervention accomplishes the predetermined measures of success and, therefore, the government 

should repay the investor. 

Because of the relative novelty and complexity of these projects, a third-party intermediary has also been involved in many of the Pay for Success contracts entered 

into to date. 

Pay for Success financing provides a number of benefits over traditional government 

mechanisms for selecting and scaling up interventions, including: 

• It allows governments to shift resources towards effective prevention and early 

intervention; 

• It draws on expertise and energy from outside investors, who bear much or all 

of the financial risk if a program is ultimately not as effective as expected; 

• A rigorous cost and benefit analysis is necessary to even consider a Pay for Success arrangement, increasing the ability of the government to invest wisely; 

• Outcome tracking is a centerpiece at every step, allowing the necessary tracking 

processes to be ‘‘baked in’’ to an intervention from the very beginning; and 

• While Pay for Success does not privatize critical government services (such as 

remedial education, criminal justice, or the like), it does hold the potential to 

reduce the overloaded demand on many of those services, allowing them to better fulfill their missions. 

69 

1 Institute for Child Success. Pay for Success Financing for Early Childhood Programs: A Path 

Forward. 2014. Available at: http://www.instituteforchildsuccess.org/mydocuments/pay_ for_ 

success_ financing_ for_early_childhood_ program2.pdf. 2 National Research Council (U.S.) and Institute of Medicine (U.S.) Committee on the Prevention of Mental Disorders and Substance Abuse Among Children, Youth, and Young Adults. Preventing Mental, Emotional, and Behavioral Disorders Among Young People: Progress and Possibilities. 2009. Available at http://www.ncbi.nlm.nih.gov/books/NBK32775/. 

Pay for Success and Effective Early Childhood Interventions 

As we discussed in our 2014 brief on this topic, Pay for Success is particularly well 

suited to help scale effective early childhood interventions.1 Many interventions 

exist today with long-term outcomes that are independently compelling, create significant value for governmental entities, and produce outcomes that advance priorities outlined in S. 1089. Those outcomes include: 

• More economically independent mothers, 

• Reduced incarceration rates, 

• Fewer teen pregnancies, 

• Fewer closely spaced second births and fewer preterm second births, 

• Fewer injury-related visits to the emergency room, 

• Reductions in child maltreatment, 

• Less youth crime, 

• Higher achievement in school or careers, and 

• Increased lifetime earnings. 

Yet despite wide agreement that we should develop and implement these effective 

early childhood interventions broadly, it is very challenging to do so. Many governmental agencies are working to implement effective early childhood interventions, 

but those efforts are far from full-scale. Two barriers stand out: 

(1) Resources are tied up in responding to problems, leaving little room 

for prevention. Governments are busy putting out fires—that is, responding 

to problems after they happen—and after more cost-effective responses are no 

longer an option. Given the fiscal and political pressure faced by all governmental entities, government is rarely able to devote sufficient up-front resources to developing or implementing effective methods to prevent problems 

in the first place, even if those approaches would save money in the long run. 

For instance, the Institute of Medicine has documented the costs of failing to 

focus on prevention, finding that many mental, emotional, and behavioral disorders in young people are preventable, but that prevention remains underfunded.2

(2) The costs of wide-scale implementation are immediate, but the payback takes time. Although many programs will deliver both social and financial returns, those benefits take time. Governments often find it difficult to afford investments with delayed returns. 

Pay for Success can help address both of those barriers. Governments are able to 

implement tested interventions without immediately burdening the budget, since 

the model allows governments to wait until the relevant outcomes are met before 

payments must be made. If those interventions are ultimately effective at scale, 

then any resulting cost-savings can be used to help repay the investors’ principal 

and any premium that is agreed to at the outset. Moreover, if the interventions do 

not produce the agreed-upon outcomes, then the government does not have to pay. 

Why Does the Federal Government Need to Get Involved? 

One of the questions that often arises in discussions about Pay for Success is this: 

Why is it important for the federal government to get involved? The simple answer 

is that many effective interventions produce positive results and save money at both 

the federal and state or local levels, and—for many of those—the federal government has a significant interest. For example, some two-generation early childhood 

interventions result in the improved birth spacing and more economically selfsufficient mothers, and therefore reduce dependency on a range of entitlement programs including Medicaid and TANF. Congress should, therefore, position federal 

programs to foster and leverage those outcomes. If it does so as structured in S. 

1089, both states and the federal government will benefit. 

70 

3Some Pay for Performance systems, which are supported also by S. 1089 but are beyond the 

scope of these comments, would allow for ongoing funding and evaluations. 

In addition, the federal attention and support for outcome-based payments will 

incentivize jurisdictions around the country to increase accountability for outcomes 

in government programs. Identifying the most effective programs and tracking their 

outcomes requires capacity and effort. This legislation will support and incentivize 

jurisdictions to build that capacity. The result will be more cost effective government investments and better outcomes for our communities and our country. 

Why Do We Need Legislative Action to Support Pay for Success? 

The typical appropriations process presents two significant barriers that prevent 

agencies from engaging in meaningful Pay for Success deals, both of which are addressed by S. 1089. First, federal appropriations typically have to be ‘‘obligated’’ by 

September 30 of any given fiscal year. What we’ve learned over the last few years 

is that many of these deals take more than one year to develop to the contractsigning phase. Knowing that the money may evaporate after months of diligent 

work, but before a deal is finalized, is a substantial hurdle. 

Second, federally appropriated dollars typically have to be disbursed within 5-years 

after the fiscal year in which they are appropriated (under 31 U.S.C. 1552(a)). Many 

Pay for Success contracts are best suited to something a little longer than a 5-year 

window, if only because most programs take a couple of years to reach scale, and 

long-term outcomes may take several years to be fully measured after that. As an 

example, the first Social Impact bond out of the United Kingdom was a 6-year contract. 

Both of those barriers require Congressional action, but the fix is relatively simple 

and is handled in S. 1089. However, there is a larger challenge the federal government will face as it engages in Pay for Success financing projects, and that is a challenge of human capital. Federal entities are generally not experienced in this field, 

and we need to develop that expertise in a deliberate fashion. Through the commission created in S. 1089, we can begin building expertise throughout the federal systems, allowing us to operate more efficiently in this field going forward. 

What Are the Limitations and Challenges of Pay for Success Financing? 

As with any exciting new model, it is easy to lose sight of the limitations and challenges. There are some problems for which Pay for Success is simply not a solution. 

For example, it does not provide a sound model for providing ongoing funding programs, or for encouraging better evaluation of programs, that are already operating 

at scale.3 It also is not yet well-suited to fund untested innovations (though, a robust Pay for Success mechanism might encourage novel innovations to look to earlier evaluations). 

Similarly, Pay for Success might not make the most sense for those specific services 

in those rare circumstances where success is nearly guaranteed, because the model 

does involve premium payments in exchange for investors bearing the risk of failure. In a case where there is virtually no risk, then the investment would be less 

beneficial from a financial perspective. Even in that scenario, however, Pay for Success financing may provide governments with the fiscal relief they need to help shift 

resources from remediation towards prevention by enabling them to pay at the end 

of the project rather than at the beginning. 

Moreover, Pay for Success financing deals are difficult to put together, from a technical perspective, so they are currently only appropriate for larger projects where 

the benefits exceed the transaction costs. 

What Are Some of the Technical Challenges of Pay for Success Financing? 

• Identifying rigorously tested interventions: We have to find and develop 

interventions with rigorous evidence of outcomes. There are many interesting 

interventions out there with great confidence in, but little proof of, their results. 

So the first hurdle is identifying the rigorously tested programs, and then also 

encouraging promising programs to develop the kind of evidence that investors 

and governments need. S. 1089 wisely emphasizes the importance of feasibility 

studies to address both of these issues. 

• Identifying governmental entities: One difficulty here flows from the fact 

that many governments are interested in this model primarily for interventions 

that produce net cost savings (in that they cost less now than they save later). 

However, those savings may spread among various governmental entities, especially with early childhood interventions, from Medicaid to juvenile justice to 

71 

education. It is sometimes difficult to find a single agency that reaps enough 

of the benefits, then, to afford the full costs of a successful program. S. 1089 

addresses this issue in two ways. First, it provides for a single entity that can 

look at benefits across the federal government and, second, the legislation is 

created to support state and municipal deals that impact federal priorities. 

• Identifying appropriate outcome metrics: We have to be very cautious to 

identify outcome metrics with which the service providers, the investors, and 

the government are all comfortable. This is one of the most challenging elements, particularly with respect to concerns over creating perverse incentives. 

PFS financing should avoid the danger that providers will ‘‘game the system’’ 

by determining outcomes compared to a control group or a matched comparison 

group. If the evaluation is well designed, any changes in how outcomes are 

counted will affect both the program group and the control group and thus will 

not translate into better results. This challenge is also why building expertise 

and collaboration within the federal contracting system—as S. 1089 envisions— 

is critical to long-term success. 

• Building the system to measure success: As mentioned above, a centerpiece 

of Pay for Success financing is rigorous and ongoing outcome measurement, 

which is challenging for even the best-resourced programs. Pay for Success, 

however, builds that evaluation into the model from beginning to end, and in 

such a way that it cannot get lost in the shuffle—investors only invest, and only 

get a return, if successes are measured and verified by an independent evaluator. S. 1089 supports that model by expressly requiring that the evaluation 

mechanisms be identified at the beginning. 

Given These Difficulties, Why Is so Much Progress Happening Anyway? 

• Investors are asking for it: We frequently hear from bank executives that 

their high-net-worth clients increasingly seek investments that are aligned with 

their values. More and more, the industry is focusing on generating both direct 

financial returns and positive social outcomes. 

• Governments are looking for more cost-effective strategies to achieve 

public goals: Governments spend a tremendous amount of resources responding to crisis situations and providing remediation services. Those governments 

would normally have to sacrifice some of those critical services to invest resources in early interventions. Pay for Success allows governments breathing 

room to pay for interventions, in full or part, out of the long-term savings they 

produce. Moreover, Pay for Success financing helps governments move in a direction they are increasingly interested in: toward analyzing benefits and costs 

of specific strategies and choosing the ones that produce the best value for taxpayers. 

Conclusion 

Pay for Success Financing is a promising tool for improving social outcomes and 

government efficiency. The Institute for Child Success is encouraged by the attention this financing model has received by our elected officials at the federal level, 

and we are even more encouraged by the Committee’s positive hearing on S. 1089. 

This financing model is challenging, especially for the federal government, but has 

tremendous potential for improving our collective fiscal position while directly improving social outcomes. We look forward to continued work with the Committee 

and Congress on this issue in the weeks and months to come. Thank you for the 

consideration of these comments. 

INTERNATIONAL FOSTER CARE ALLIANCE (IFCA) 

Seattle Office 

6542 4th Avenue NW, Seattle, Washington 98117 U.S.A. 

1–888–447–IFCA [4322] 

Tokyo Office 

1–33–6–202 Tomigaya, Shibuyaku, Tokyo, 151–0063 JAPAN 

info@ifcaseattle.org 

www.ifcaseattle.org 

Statement of Miho Awazu, MSW, LICSW 

72 

I would like to thank Chairman Hatch, Ranking Member Wyden, and other distinguished members of the Senate Finance Committee for the opportunity to submit 

this statement for a matter that is of great importance for me and for my nonprofit 

organization members. 

I am the founder and board president of International Foster Care Alliance (IFCA), 

a nonprofit organization based in Seattle, Washington. As an international child 

welfare organization, we create and sponsor collaborative projects that connect foster youth, foster parents and child welfare professionals between the United States 

and other countries. We are currently working primarily with our branch office and 

project partners in Japan. 

IFCA believes that the shift of focus from traditional psychotherapy to more 

evidence-based practices (EBP) and increase in accessibility of these quality EBPs 

for children and youth in foster care is a pressing issue that needs urgent policy 

attention. 

The purpose of this statement is to: 

• Illustrate the needs of quality evidence-based mental health treatment for children and youth in the foster care system in this country, and the consequences 

of not pursuing this goal for the future of our young people and taxpayers; 

• Recommend Trauma-Focused Cognitive Behavioral Therapy (TF–CBT) as an 

evidence-based treatment method for child and youth who experienced traumatic 

events in their lives; 

• Inform others about our organization, which promotes collaboration between mental health professionals and foster youth, and explain why it is important to include foster youth’s voice as some of the best spokespersons for the future mental 

health policy and practice reform in the U.S. and beyond. 

Current Conditions of Mental Health Services for Children and Youth in 

Foster Care 

Each year, approximately 250,000 children enter foster care in this country. These 

foster care populations disproportionately include low-income families and communities with racial and ethnic minorities. 

Prior to entering foster care, approximately 90% of these children were exposed to 

multiple traumatic experiences that include but are not limited to physical and sexual abuse, serious and chronic neglect, and exposure to domestic and community violence. Prolonged trauma exposure in childhood significantly increases the risk of 

negative developmental outcomes. A study indicates that up to 80% of the children 

in foster care require interventions for serious behavioral and mental health problems. It found that about three out of five children in foster care have a lifetime 

mental health diagnosis and close to one in five children has three or more lifetime 

mental health diagnosis.5, 8

Despite this great concern regarding mental health of children entering foster care, 

an astounding 75% of investigated children with mental health problems are not 

likely to receive needed treatment. It is speculated that even higher rates of unmet 

need are found among children who remain at home after child protection agencies’ 

investigations.1

Some researchers argue that one of the biggest reasons why foster children do not 

receive mental health services is because they are not provided with necessary mental health screening or assessment after the initial investigation. A study found that 

more than half of all agencies surveyed did not require systematic, universal mental 

health evaluations for children entering foster care. Only 20% had limited policies 

that required mental health evaluations, and about 30% of agencies lacked any policy regarding mental health assessment. With no policy or limited mental health assessment policy agencies, concerns related to children’s behavioral and emotional 

problems, suicidal risks, substance abuse and other impaired functioning can easily 

be neglected.6

In contrast, interventions with medications are far more frequently used among the 

foster care population in this country. In 2011, the Government Accountability Office (GAO) reported that a child in foster care is up to 4.5 times more likely to receive psychotropic drugs compared to a non-foster child. Psychotropic medications 

created to address serious mental health disorders alter children’s behaviors, mood 

and emotions. Furthermore, GAO reveals that foster children are more likely to be 

prescribed five or more psychotropic drugs at an age and at doses not approved by 

the Federal Drug Administration. It is alarming that many of these children receive 

73 

psychotropic medications with no additional interventions such as psychotherapy 

and behavioral treatment.2, 10

Need for Evidence-Based Treatment for Children in Foster Care and Cost 

of Not Providing Such Services 

Adolescents age out from the foster care system between age 18 and 21 are newly 

independent young adults who have very little support and resources and encounter 

astonishingly high rates of unemployment, homelessness and other adversities. 

Mental health, social, and other concerns continue among youth who have experienced foster care throughout their childhood. 

Child trauma experts state that trauma exposure, especially exposure to child abuse 

and neglect, appear to have a life-long impact. Adults who at some point were in 

foster care are two to seven times more likely to have PTSD, anxiety disorders, depression and drug dependence than adults who were not in foster care, and these 

diagnoses are also frequently associated with a number of other mental health 

issues such as aggression, attention deficits, eating disorders, and suicidal thoughts 

and behaviors.11

Also in recent years, increasingly more studies have been conducted on links between mental health and physical health, and the results indicate that co-occurrence 

of mental and physical illnesses is a notable consequence of childhood maltreatment. 

Children diagnosed with mental health disorders such as depression, anxiety and 

PTSD, often receive medical diagnoses including heart diseases, diabetes and cancer.9

Considering the multiple traumatic exposures and other life difficulties that foster 

children experience before entering state care, one could imagine that their mental 

health costs are very high. Regarding the cost of mental health services, Medicaid 

expenditures for children in foster care receiving behavioral health services are significantly higher than for other children in Medicaid. Children in foster care have 

the highest mean behavioral health expenditures at $8,094 per year, compared to 

other children in Medicaid ($4,868).2

As stated above, cost of mental health for maltreated children is a societal issue. 

However, if we all know that the mental health conditions of foster children continue onto their adulthood and affect their physical health throughout their life, the 

benefits of these youth receiving services far exceed the potential cost of them not 

receiving timely and effective treatment. 

The use of traditional never-ending psychotherapy, however, is not the answer to 

solve the financial and other challenges. A study showed that traditional psychotherapy received for six months by foster children at the time of entry into foster 

care did not have any overall outcome in depression, self-esteem, and behavior problems. It is urgent that policy makers and other stakeholders pay close attention to 

time-limited, effective treatment methods supported by evidence. 

Psychologist Shannon Dorsey is one of the most well-known child trauma treatment 

researchers and trainers. She is one of IFCA’s project partners. In her 2012 research, Dr. Dorsey concludes that routine trauma exposure screenings should be utilized for all children entering foster care. Treatment should include trauma-focused, 

evidence-based treatment, and information sharing needs to be increased among 

caregivers, child welfare workers, and all professionals providing care for foster children and their families.7

Trauma-Focused Cognitive Behavioral Therapy (TF–CBT) Is One of the 

Most Preferred Treatment Methods for Children and Youth in Foster Care 

Trauma-Focused Cognitive-Behavioral Therapy (TF–CBT) is the most wellsupported and effective treatment for children ages 3 to 18 who have been abused 

and traumatized. Multiple clinical research studies consistently have found it to 

help children with PTSD and other trauma-related problems, and it has been rated 

a Model Program and Best Practice for use with abused and traumatized children. TF–CBT currently is being used successfully in child welfare and community 

service agencies across the country. 

The treatment is based on learning and cognitive theories and addresses distorted 

beliefs related to the abuse. Combining elements drawn from various therapy techniques including cognitive therapy, behavioral therapy and family therapy, TF–CBT 

provides a supportive environment in which children are encouraged to talk about 

their trauma experience. TF–CBT also helps children’s caregivers cope effectively 

with their own emotional distress and develop skills that support the children.2, 3, 12

74 

Barriers often documented for implementing evidence based practices in the United 

States are: 

• The need for the development of more culturally appropriate and sensitive services while maintaining the fidelity of the practices; and 

• Accessibility to affordable and specific training for clinicians on trauma focused 

interventions. 

TF–CBT addresses the above two barriers with these solutions below: 

Æ When TF–CBT was developed by 3 mental health professionals on the east 

coast, they looked at the cultural and ethnic diversity of this county, and at the 

possibility of disseminating this treatment model worldwide. The result was a 

trauma treatment method known to be one of the most ‘‘culturally relevant’’ 

evidence based practices. The training manuals contain many materials to 

teach clinicians cultural considerations and sensitivity. 

Æ The ‘‘TF–CBT Web’’ is a free, open website that contains many lessons for clinicians and students. Anyone who has a master’s degree in related fields can access this website and receive a certificate upon completion of the 15-hour 

course. In addition, in the last 15 years, the developers trained over 50 trainthe-trainers across the nation certifying them to train other TF–CBT trainers 

and increasing the accessibility of trainers. They also have several world trainers who have traveled to many parts of the globe to teach this method.2, 3, 13

Furthermore, TF–CBT is a time limited (12 to 16 weeks) treatment that involves 

not only traumatized children but also their caregivers. By involving caregivers in 

the therapeutic process, child clients are always with them caregivers’ recoveries accelerated. This unique child-caregiver dyad practice thus makes the treatment 

model cost effective. 

IFCA’s Global Programs Involving TF–CBT Dissemination Efforts and Partnership Between Mental Health Professional’s Expertise and Foster Youth 

In the last 10 years, child abuse and neglect cases have rapidly increased in Japan 

and, more than ever before, effective therapeutic methods are sought for these child 

victims. In 2011, the large earthquake/tsunami in eastern Japan brought challenges 

to many children who lost their family members. Abuse and disaster victim children 

and youth suffered complex trauma and grief symptoms and needed effective and 

timely therapy. 

IFCA’s first project since its inception in 2012 was to bring one of the best American 

TF–CBT to Japan. 

Monica Fitzgerald, Ph.D. (University of Colorado), a world TF–CBT trainer, has visited Japan 4 times in the past 3 years and taught over 200 clinicians in the Tsunami disaster affected area and other major cities in Japan. In 2016, Shannon Dorsey, Ph.D. (University of Washington) came to Tokyo with IFCA’s invitation and 

taught TF–CBT method to an additional 40 clinicians in Japan. These 240 clinicians 

have treated a total of over 1,000 children with this evidence-based trauma treatment method. 

On the following pages of this document, you will be able to read a Japanese 

clinician’s notes from her work using TF–CBT with boy ‘‘H’’ who was a child 

abuse victim and lost his only relative. 

One another major program that IFCA offers is foster youth collaboration between 

Japan and the United States. Foster youth and foster care alumni from the Tokyo 

and Seattle areas visit one another’s country once per year to learn about foster care 

systems in a culturally and geographically broader context. From these exchanges, 

youth members learned that youth in these two countries suffer from complicated 

emotions and trauma related to their past abuse and neglect, as well as from an 

astounding lack of quality mental health services available to them. In both countries, foster youth have considerably worse outcomes than youth who grow up in traditional home settings. 

To bring about public awareness and changes in the metal health policy field, IFCA 

has established a unique collaboration model where foster youth and mental health 

experts present together at national and world scholastic conferences. 

Our young member team with mental health professionals from Japan and the U.S. 

presented at the International Society for the 2014 Prevention of Child Abuse and 

Neglect (ISPCAN) World Conference in Nagoya. They also presented at the 2015 

75 

American Professional Society of the Abuse of Children (APSAC) National Conference in Boston. 

Experts in the mental health field are not just professional adults. Foster youth are 

important experts who have experienced and lived the system and can bring unique 

insider perspectives to policy discussions. Including youth’s voices to change the current systems is far more effective than having only clinicians and researchers and 

policy makers involved in the reform efforts. 

On the following pages of this document, former foster youth Janice shares her 

own experience as a foster child as well as her emotional/psychological recovery, 

and describes some of the challenges that foster youth face when receiving mental health services in the U.S. 

Conclusion 

Since the enactment of the Adoption and Safe Families Act (1997), the focus of child 

welfare has been to achieve safety, permanency and well-being of vulnerable children and youth in foster care. The principle of ‘‘well-being’’ encompasses children’s 

emotional and behavioral health. Despite the recognized importance of mental 

health services for foster care population, there still is a significant gap between 

children who need services and children who receive services. 

If the goal is to reduce the unmet need for mental health services among children 

and youth in foster care, child welfare agencies, legislators and other stakeholders 

will need to implement high quality, time-limited, cost effective evidence based 

treatment. 

A Child Psychiatrist’s Story About 10 Year-Old Boy ‘‘H’’ 

A child psychiatrist who participated in Dr. Fitzgerald’s workshop is treating 

trauma-affected children in one of the Tohoku prefectures. She sent IFCA the following message. 

Ten-year-old boy ‘‘H’’ was abused by his parents since he was a toddler. After being 

abandoned by his parents, ‘‘H’’ has been raised by his grandmother. On March 11th, 

2011, ‘‘H’’ lost his only relative, his grandmother, in the Tsunami disaster. Being 

in a severe state of shock and confusion, ‘‘H’’ was placed in a psychiatric hospital. 

For many months, this young boy was not willing to talk to anyone. 

I treated ‘‘H’’ using TF–CBT’s technique. Slowly but surely, ‘‘H’’ has opened up his 

mind and started to speak to me about his parents’ past abuse towards him, the 

horrific experience of the Tsunami disaster, and his feelings towards his grandmother. TF–CBT has a wonderful tool called ‘‘Trauma Narrative.’’ Children use this 

method to create their own books to talk about their trauma experiences. Not only 

do they share these books with their therapists, they also share them with their 

caregivers. This experience leads the children to a state of self-discovery and revelation. 

‘‘H’’ was released from the hospital and lives in a local children’s facility. He can 

now talk with his peers about his bright future. Through practicing TF–CBT, I 

learned what traumatized children should learn about their internal selves. 

Monica Fitzgerald, Ph.D. 

APSAC Speech, July 23, 2015 by Janice Cole 

The very circumstances by which youth enter foster care necessitate challenges with 

trauma and mental health. Consider the two reasons that a youth would enter foster care: (1) abuse or (2) neglect. For whatever and for varied reasons, their parents 

were unable to care for them, and so they are removed. Ignoring the circumstantial 

trauma of why youth enters care, the removal itself, and the separation from one’s 

biological family, is a whole different trauma. Foster youth are sent to live with 

strangers, often with little to no explanation, and often without their siblings. I 

think there are few who would argue against the claim that people who go through 

situations like these need mental health support. 

In fact, in a recent study by Casey Family Programs, it was found that 80% of foster 

youth experience some kind of mental health challenge that requires treatment and 

intervention. Additionally, the study finds that there is a high need for mental 

health services, and yet an underutilization of the services that are available. Other 

challenges found include racial disproportionality, type of placement, over medicaVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00079 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
76 

tion, lack of proper assessment tools, lack of appropriate treatments, and stigma of 

not only being in foster care, but also of accessing mental health services. 

I would like to argue that while mental health services do in fact exist, they need 

to be taken a step further. We need to move away from simply the availability of 

services, and move toward providing quality, evidence-based services for youth and 

alumni of care. This is something I strongly believe can only be accomplished if professionals partner with the youth they are serving. To illustrate this point, I would 

like to share my own story of mental health. 

I mentioned that foster youth typically enter foster care due to abuse or neglect. For 

me, I entered foster care at age 3 due to neglect. My biological parents were so addicted to drugs and alcohol that by the time the state intervened, my older brother 

(who was 5) was the sole caretaker of both myself and our younger brother (who 

was 1 year old). When I was put in foster care, I was separated from both of my 

brothers and had three different placements by age 5. Now, I would like to pause 

and draw your attention to the traumas I had amassed by this point in my life: poverty, neglect, malnourishment, loss of parents, loss of siblings, and placement instability. I was also extremely bullied by my foster brothers and sisters. 

Given this, it should be no surprise that when I was adopted at age 6, I was immediately placed into therapy. However, I use this term loosely. I remember each week 

I would go to my therapist’s office and play with toys while my parents sat and 

right in front of me would tell this stranger how my brothers and I were ruining 

their lives. I do not ever remember this therapist ever speaking to me, which was 

funny because I was her actual client. In fact, our therapist-client relationship was 

so non-existent that when my adoptive parents began to abuse me, I said nothing 

to her. I feared that since she only ever spoke with my parents, that she would simply tell them what I said, and I would get more hurt. 

Eventually, the counseling sessions ceased, but the abuse did not. In fact, it worsened in every way. My adoptive parents threatened that if I ever told anyone what 

was happening, the state would come and take me away, and I would never see my 

brothers again. Having experienced the pain of that loss before, I stayed silent. This 

went on for nine years until I couldn’t take it anymore. It was only after a failed 

suicide attempt that I finally gathered the courage to speak up. 

As soon as I did, I was immediately placed back into foster care in relative placement with my oldest sister. I was also immediately placed into therapy. This time 

though, things were different. My therapist, who specialized in intensive trauma recovery, actually asked me questions about myself. She always asked my permission 

before sharing anything that I told her with my guardians. She also focused on empowering me by giving me the tools to work toward my own recovery. She explained 

to me what triggers were, and taught me grounding techniques so that when I was 

triggered and felt a panic attack coming, I could cope and not be afraid. Having the 

skills to take charge of my own mental health was one of the most liberating experiences I have ever had. I can’t say that my mental health is perfect, as I am sure 

none of us can. But I can say that this therapist taught me that I was powerful, 

not broken. That I was normal and brave for asking for help. And she taught me 

that I could heal. 

I hope that my story, along with those of my peers, has illustrated how important 

it is to not just offer mental health services, but to provide quality, evidence-based 

treatment. I hope we have also shown you how critical it is to partner WITH youth 

and alumni of care, and to empower them to be the strong and resilient people we 

all know them to be. 

As a team, we put together a list of recommendations on ways mental health providers could incorporate these ideas into their own practice. I’d like to share those 

now, and we hope that these will be a starting off point as we engage in small group 

dialogue on practice implications. 

(1) Know: 

Æ The culture of foster care. 

Æ What evidence-based practices exist. 

(2) Ask: 

Æ What do you need? What do you want? 

(3) Listen: 

Æ Affirm our experiences, and don’t be afraid to ask about/talk about our trauma. 

Æ Normalize therapy and teach us that getting help is not only okay, but brave 

and strong. 

77 

(4) Respond: 

Æ Teach: skills for managing trauma reactions and symptoms. 

Æ Anticipate: resurfacing trauma and triggers. 

Æ Connect: to support services, educate youth on how to find and access evidencebased mental health supports so that in the future, when things resurface, as 

we all know they will, we won’t be afraid to take charge of our own lives. 

Thank you. 

References 

1 Ai, A.L., Jackson Foster, L.J., Pecora, P.J., Deleaney, N., and Rodriguez, W. (2013). 

Reshaping child welfare’s response to trauma: Assessment, evidence-based intervention, and new research perspective. Research on Social Work Practice 23(6); 651–68. 

2 Center for Health Care Strategies, Inc. (June 2014). Medicaid behavioral health 

care use among children in foster care: Fact sheet. 

3 Cohen, J.A., Manarino, A.P., and Deblinger, E. (2006). Treating trauma and traumatic grief in children and adolescents. New York: The Guilford Press. 

4 Cohen, J.A., Manarino, A.P., and Deblinger, E. (2012). Trauma-Focused CBT for 

children and adolescents. Treatment Application. New York: The Guilford Press. 

5Dorsey, S., Burns, B., Sutherland, D., Cox, J., Wagner, H.H., and Farmer, E. 

(2012). Prior trauma exposure for youth in treatment foster care. Journal of Child 

and Family Studies 21(5), 816–824. 

6Levitt, J.M. (2009). Identification of mental health service need among youth in 

child welfare. Child Welfare 88(1), 27–48. 

7Love, S.M., Koob, J., and Hill, L.E. (2008). The effects of using community mental 

health practitioners to treat foster children: Implications for child welfare planners. 

Scientific Review of Mental Health Practice 6(1), 31–39. 

8Pecora, P.J., Jensen, P.S., Romanelli, L., Jackson, L.J., and Ortiz, A. (2009). Mental health services for children placed in foster care: An overview of current challenges. Child Welfare 88(1), 5–26. 

9Pecora, P.J., Kessler, R.C., Williams, J., Downs, A.C., English, D.J., and O’Brien, 

K. (2010). What works in family foster care?: Key components of success from the 

Northwest foster care alumni study. New York and Oxford, England: Oxford University Press. 

10 United States Government Accountability Office. (2011). Foster Children: HHS 

Guidance Could Help States Improve Oversight of Psychotropic Prescriptions: Statement of Gregory D. Kuts, Director Forensic Audits and Investigative Service. 

11Zlotnick, C., Tarn, T.W., and Soman, L.A. (2012). Life course outcomes on mental 

and physical health: The impact of foster care on adulthood. American Journal of 

Public Health 102(3), 534–540. 

12 International Foster Care Alliance (IFCA), http://www.ifcaseattle.org/professionals.html. 

13TF–CBTWeb, https://tfcbt.musc.edu. 

LOCAL INITIATIVES SUPPORT CORPORATION (LISC) 

TESTIMONY SUBMITTED BY: 

MATTHEW JOSEPHS, SENIOR VICE PRESIDENT, POLICY 

Chairman Hatch, Ranking Member Wyden, and Distinguished Members of the Senate Committee on Finance: 

The Local Initiatives Support Corporation (LISC) appreciates the opportunity to 

submit testimony for the record on how evidence-based practices improve outcomes 

for vulnerable families. We especially appreciate the opportunity to highlight how 

the Pay for Success (PFS) model, also known as Social Impact Bonds, is supporting 

evidence-based practices in local communities. Thank you, Senators Hatch and 

Wyden, for initiating a discussion around a relatively new alternative funding mechanism that will benefit low-income families and economically challenged communities plagued by disinvestment. 

78 

ABOUT LISC: 

Established in 1979, USC is a national non-profit Community Development Financial Institution (CDFI) dedicated to helping community residents transform distressed neighborhoods into healthy and sustainable communities of choice and opportunity—good places to work, do business and raise children. LISC mobilizes corporate, government and philanthropic support to provide local community development organizations with loans, grants and equity investments, as well as technical 

and management assistance. 

LISC has local programs in over 30 offices nationwide and partners with over 70 

rural community organizations. For more than three decades, LISC has developed 

programs and raised investment capital to help local groups revive their neighborhoods. We deliver tailored support for community-based organizations to meet specific needs in the areas of housing, economic development, education, healthcare, 

community safety, and building family financial stability. 

In recent years, LISC has been at the forefront of developing model initiatives that, 

in addition to providing tremendous benefits for low-income families, have the potential to result in considerable cost savings for federal, state and local governments. Our work attempts to meet the comprehensive needs of communities, spanning multiple categories—from improving the long term financial well-being for families, to reducing crime in communities through targeted interventions, to investing 

in supportive housing that mitigates the societal cost of emergency responses for the 

chronically homeless. 

In early May 2016, the Corporation for National and Community Service (CNCS) 

announced LISC as a Social Innovation Fund (SIF) PFS grant recipient. Over two 

years, a $1.3 million award will be used by LISC to provide transaction structuring 

support to three to four PFS projects. LISC’s program will connect government 

funding to preventative programs in the health, youth and employment arena in an 

effort to demonstrate positive outcomes for people who access these services. By 

helping social service providers design programs, raise private capital and produce 

the metrics needed to demonstrate results, we will be continuing our work in revitalizing neighborhoods and improving outcomes for its low-income families. 

IMPROVING COMMUNITIES VIA PAY FOR SUCCESS: 

Evidence-based practices and policies are a way to build a culture of continuous improvement and accountability through the use of administrative data to monitor ongoing program performance. As Senator Wyden conveyed during the hearing, ‘‘This 

is a great opportunity to dig into an issue that really should be an underpinning 

of the work Congress does every day: that is to say, we should be constantly asking 

whether the laws we write are working as they ought to be.’’ With evaluation built 

into the PFS model, there are clear metrics of success. Below are several examples 

of our work that we believe will help to enrich the field of Pay For Success. 

LISC NYC Two Shades of Green 

LISC New York City’s Two Shades of Green (TSG) program is a housing preservation strategy that incorporates green and healthy practices into the buildings. LISC 

received a $15 million Weatherization Assistance Program (WAP) contract from 

New York State to fund the installation of energy-efficiency retrofits in 2,226 apartments in 95 buildings. LISC used this opportunity to expand the program scope beyond energy outcomes to capture other health, environmental and economic benefits. 

TSG has two primary goals. First: Increase the health and wellness of building residents and staff by integrating green, healthy and cost-effective measures into existing affordable housing rehabilitation and property maintenance. Measures include: 

safe and green pest control to reduce exposure to toxic pesticides, aperture sealants 

to prevent pests from entering and heat from escaping, smoke-free housing to reduce resident exposure to secondhand tobacco smoke and fire risk as well as decrease the cost of unit turnover, active design through low-cost modifications and 

add-ons to increase the physical activity of residents, and use of green cleaning 

products to reduce exposure to harmful chemicals. 

Second: Help property managers and owners consume less energy and water and 

realize cost savings through more efficient operations. As such, TSO also provides 

a comprehensive set of services to advance energy and water conservation measures, 

including: benchmarking to measure project performance pre- and post-retrofit, 

project design assistance for energy and water retrofits, coordination with available 

rebate or incentive programs, preparation of financing packages to support retrofit 

work, and staff training and preparation of operation and maintenance plans. 

79 

Since 2013, LISC and our partners have helped implement TSO energy, water and 

health upgrades on 600 units. Baseline measures have been established to hone 

TSO outcomes and assess changes to asthma triggers, costs, and complaints over 

time, and the program conducts ongoing evaluation of both the health and utility 

outcomes. Preliminary evidence shows a reduction in the number of asthma attacks 

and other health complaints for building residents along with reduced utility costs 

for property managers. 

Supportive Housing Services to Vulnerable Populations 

Senate Finance Committee members emphasized a desire to see federal funds used 

more effectively to address social issues. We believe that providing supportive housing services to vulnerable populations represents an opportunity to recognize cost 

savings to society. 

LISC, through its affiliate the National Equity Fund (NEF), financed a mixedincome housing property in Brooklyn, NY which includes 60 supportive housing 

units: 20 designated for referrals from the New York State Office of Mental Health 

and 40 for referrals from the New York City Department of Homeless Services. All 

of the referrals for these 60 units are persons living with a diagnosed mental illness, 

and nearly all (more than 90%) spent at least one year prior to their arrival in an 

expensive publically funded institutional setting (either a city emergency shelter or 

a state psychiatric center). The development opened in the spring of 2012; by November of that year, all 60 units were occupied. 18 months later (November 2013), 

90% of the original occupants (55 out of 60) remained housed at the development. 

Services include medication monitoring and education, entitlements counseling, access to mental health and primary health care and supported employment programs. 

The resultant cost savings are significant: Residents at the development are maintained in housing in the community at a fraction of the cost associated with the 

intuitional alternatives they resided in before. The annual cost to maintain a patient 

in a New York State funded psychiatric center is $292,730; the annual cost to permanently house a former OMH psychiatric center patient at this development is less 

than 15% of that amount, or roughly $32,000 per year. 

Financial Transaction Structuring 

There are many high-performing social programs operating throughout the country, 

but little capacity or capital available to such programs in order to bring them to 

scale. Transactions yield too thin a margin without capturing the federal component 

of the savings to offer risk-adjusted returns that would attract market-oriented ‘‘impact investors.’’ USC is well positioned to determine whether a project is a best 

practice that can and should be replicated. We have the capacity to examine an 

evidence-based strategy, its social value in the targeted low-income communities, 

the magnitude of the organizational capacity to implement the project, its attractiveness to funders and other providers of capital, and its riskiness in terms of 

repayment of capital and achievement of social outcomes. 

Financial intermediaries like LISC and other CDF is have much to offer the field 

of social impact investing. In a recent report by MDRC, Learning From Experience: 

A Guide to Social Impact Bond Investing, Gordon Berlin points out, ‘‘Community development finance institutions have the infrastructure and the know-how needed to 

make social investing deals, making them the ‘go-to’ organizations for SIBs.’’ 

We hope to help build the body of knowledge around PFS best practices and transaction structuring and contribute to the ongoing conversations about the strengths 

and limitations of the Pay for Success model. LISC is committed to helping to shape 

the future of social impact investing in terms of program implementation, deal 

structuring and evaluation. As we share our insights with CNCS and the Social Impact Investing field, we hope to identify and bridge existing gaps in services needed 

to close PFS transactions. To this end, in February 2016, USC hosted a webinar on 

underwriting PFS investments targeting private investors. USC will build on these 

knowledge sharing activities through a series of trainings on PFS structuring and 

investments, risk analysis and contracting. These activities are intended for a wide 

audiences including investors, underwriters, service providers, government entities 

and evaluators. We intend for our work to contribute to a rich pool of knowledge 

with PFS practitioners across the country, driving up the number of executed highquality PFS transactions. 

PAY FOR SUCCESS SHIFTS RISK, SPURS INNOVATION: 

Pay for Success investments shift the risk for government entities attempting innovative solutions. When there is evidence of significant cost savings, as demonstrated 

80 

above, federal, state and local governments can partner with philanthropies and private investors to leverage financial resources. Governments pay only for outcomes 

achieved. Private investors assume the risk by initially funding the intervention and 

are repaid upon success of the program. 

We applaud Congress for recognizing the utility of cross-sector partnerships and encouraging data-driven social investments. Social Impact Partnership legislation introduced by Senators Hatch and Bennet (S. 1089) and Representatives Young and 

Delaney (H.R. 5170) support measurable, clearly defined outcomes that result in social benefit, with independent evaluation as a clear indicator of program success. 

These innovative proposals encourage social service programs to have evidence of 

effectiveness in PFS projects and require rigorous evaluation. The bills also seek to 

spur innovation in the PFS arena by allocating $100 million in funding for projects 

and compensating state and local governments for savings that accrue at the federal 

level. 

As Senator Hatch pointed out during this hearing, ‘‘Social impact financings gives 

local leaders the flexibility to design and adjust programs to fit local needs in order 

to ensure that they have the desired impact.’’ By structuring payments around 

measurable outcomes, PFS’s flexibility allows implementation of evidence-based programs, careful testing of innovative projects, and scalability of successful programs. 

We applaud Congress’s bipartisan and bicameral efforts to investigate evidencebased practices. We are hopeful that Pay For Success will encourage the implementation of better programs and effective policies through the more responsible use of 

taxpayer dollars. If LISC can be a resource to you or your staff, please contact Abigail Santos, Assistant Policy Officer, at (202) 739–9288 or asantos@lisc.org with any 

questions. 

THE NATIONAL CAMPAIGN TO PREVENT TEEN AND UNPLANNED PREGNANCY

1776 Massachusetts Avenue, NW, Suite 200 | Washington, DC | 20036 

TheNationalCampaign.org | bedsider.org | StayTeen.org 

May 23, 2016 

U.S. Senate 

Committee on Finance 

Dirksen Senate Office Bldg. 

Washington, DC 20510–6200 

Re: Full Committee Hearing, ‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ 

Dear Chairman Hatch, Ranking Member Wyden, and members of the Committee: 

On behalf of The National Campaign to Prevent Teen and Unplanned Pregnancy, 

thank you for the opportunity to submit a statement for the record for the Senate 

Finance Committee Hearing ‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ held May 10, 2016. The National Campaign, 

a research-based, nonpartisan, nonprofit organization was founded in 1996. Our 

mission is to improve the lives and future prospects of children and families and, 

in particular, to help ensure that children are born into stable families who are committed to and ready for the demanding task of raising the next generation. Our 

strategy is to prevent teen pregnancy and unplanned pregnancy, especially among 

single, young adults. Ensuring that young people have access to high quality, 

evidence-based teen pregnancy prevention education is one critical element in helping more young people delay pregnancy and parenting. In this statement, we offer 

information about two such programs, the Personal Responsibility Education Program (PREP) and the Teen Pregnancy Prevention Program (TPPP), that we hope 

will be helpful as the Committee goes about its important work. 

Since the early 1990s, teen pregnancy and birth rates have declined by 55% and 

61%, respectively.1, 2 However, it is still the case that roughly one in four girls in 

this country will become pregnant before the age of 20, and nearly half of all teen 

girls in foster care have been pregnant at least once by the age of 19.3 Even with 

dramatic across the board declines, disparities persist by race and ethnicity, education and income, and geography.4 For example, four in 10 African American girls 

and one in three Latinas will become pregnant before age 20, compared to roughly 

one in six non-Hispanic White teen girls.5 Birth rates for Native American teens are 

well above the national average.6 In addition, teen birth rates in rural areas are 

81 

nearly one-third higher compared to rates in the rest of the country.7 Moreover, the 

United States has much higher teen pregnancy rates than our trading partners. 

In addition to costing taxpayers more than $9.4 billion annually, our high teen pregnancy rates threaten to hinder our nation’s progress, as young parents have less opportunity to get the education and skills they need to compete in a 21st century 

workforce.8 For instance, 30% of teen girls who have dropped out of high school cite 

pregnancy/parenthood as a key reason. And fewer than 2 percent of those who have 

a child before age 18 attain a college degree by age 30.9 However, the unprecedented 

declines over the past two decades show that progress is possible. Since the 

evidence-based programs PREP and TPPP began in 2010, the teen birth rate in the 

U.S. has declined 29%, a drop about twice as large as in any other 4-year period.10

Before these two programs began, there was no federal investments in evidencebased teen pregnancy prevention programs; research in this area had primarily 

come from private investments. In fact, our organization, which has had a long 

standing commitment to identifying and supporting evidence-based programs to reduce teen and unplanned pregnancy, published one of the first reviews of effective 

teen pregnancy prevention programs in 1997 by Dr. Doug Kirby entitled No Easy 

Answers 11 that found very few effective programs. By 2001, when we published Dr. 

Kirby’s next research review, called Emerging Answers,12 there were several rigorous studies of programs that showed sustained positive effects on behavior. These 

offered the field a handful of programs from which to choose, but trying to find funding for such programs was a struggle. When we published Dr. Kirby’s updated literature review called Emerging Answers 2007, the quantity and quality of evaluation research had grown dramatically and there were now 15 programs with strong 

evidence of positive impact on sexual behavior or pregnancy or STD rates.13 However, the ability to replicate these programs was limited in large part by a lack of 

public funding. 

In FY 2010, this changed significantly when the Finance Committee established 

PREP, funded at $75 million annually, and Congress appropriated $110 million for 

TPPP.14 As of FY 2016, there is $286 million dedicated to teen pregnancy prevention education programs, of which $176 million is devoted to these two evidencebased programs.15 An additional $6.8 million is appropriated for evaluating teen 

pregnancy prevention programs. This was a tremendous shift towards evidencebased policymaking. Still, taken together, multi-year PREP and TPPP grants are 

sufficient to serve fewer than 2 percent of teens in the United States. 

PREP and TPPP, like the Maternal, Infant, and Early Childhood Home Visiting program, have been recognized as pioneering examples of tiered evidence-based policymaking,16 and represent an important contribution to building a body of evidence 

of what works. They include high quality implementation, evaluation, innovation, 

and learning from results. The majority of PREP and TPPP funding goes toward 

replicating programs that have been demonstrated to change behavior using well 

recognized high standards of evidence. A smaller portion of funding is reserved for 

research and demonstration projects to develop, replicate, refine, and test additional 

models and innovative strategies. This ensures that the menu of effective approaches to reducing teen pregnancy will continue to grow and be refined. 

Grantees can choose a program model from a list of effective programs that have 

been identified as a result of the U.S. Department of Health and Human Services’ 

(HHS) ongoing systematic review of the teen pregnancy prevention research literature. Since 2009, HHS has sponsored this review of the literature to help identify 

programs with evidence of effectiveness in reducing teen pregnancy, sexually transmitted infections (STIs), and associated sexual risk behaviors. The review, conducted by Mathematica Policy Research, looked at hundreds of evaluations and initially identified 28 programs that met Tier 1 criteria. That is, they must have been 

evaluated using a randomized controlled trial or quasi-experimental design. These 

evaluations must demonstrate actual changes in behavior (not just knowledge or behavioral intent), and results must be published in a peer-reviewed journal. The evidence review is updated periodically to capture the latest evaluation studies, and 

now includes 44 programs.17 The evidence reviews and searchable database of effective programs available on the HHS website is similar to the ‘‘what works clearinghouse’’ called for in Results for America’s Moneyball for Government.18 The wide 

range of models on the HHS list of evidence-based programs, including abstinence 

programs, youth development programs, and those that address both abstinence and 

contraception gives grantees the flexibility to choose an effective approach that reflects their needs and values, recognizing that what people in Utah choose may be 

different from what people in Oregon choose. 

82 

PREP was established by the Finance Committee in FY 2010, alongside the State 

Abstinence Education grants. PREP continues to be funded at $75 million in mandatory funding annually through FY 2017. Administered by the Administration on 

Children Youth and Families (ACF), PREP supports states, communities, and tribes 

to educate adolescents on both abstinence and contraception to prevent pregnancy 

and STIs, and on other adulthood preparation topics such as healthy relationships, 

communication with parents, and financial literacy. PREP focuses on youth at greatest risk of teen pregnancy and geographic areas with high teen birth rates. For example, 34% of grantees targeted youth in foster care and 74% target youth in high 

need areas.19 Most of the PREP funding ($58 million) supports grants to states, territories, and tribes and emphasizes the use of evidence-based programs. Indeed, 

more than 95% of youth served by the state grants received one of the evidencebased programs from the HHS list referenced above.20 An additional $10 million 

supports competitive grants to public and private entities to develop, replicate, refine, and evaluate innovative strategies to reduce teen pregnancy and repeat pregnancies among youth up to age 21. These grants are subject to rigorous evaluation 

and reflect a ‘‘Tier 2’’ approach that support s innovation, fills gaps in existing programs for underserved populations, and expands knowledge about what works. Together, PREP grantees served more than 126,000 youth in 2014.21

Funded at $101 million for FY 2016, TPPP is a discretionary program administered 

by the Office of Adolescent Health that currently supports 81 competitive grants to 

a broad range of organizations and agencies in 38 states and the Marshall Islands. 

The grantees focus intensely on communities with the highest teen birth rates and 

the most at-risk youth. These 5-year grants were awarded in FY 2015 and are contingent on continued appropriations. Approximately 75% of the grants funds are 

used to replicate program models that have already been shown through careful 

evaluation to change teen behavior (Tier 1),and approximately 25% of the funds support research and demonstration projects to develop, replicate, refine, and test additional models and innovative strategies to prevent teen pregnancy (Tier 2). The first 

round of TPPP grantees served more than 140,000 youth in 2014,22 and the new 

round expect to serve 291,000 youth annually.23

PREP and TPPP have been lauded by independent experts as strong examples of 

evidence-based policymaking. For example, the Bridgespan group cited the TPPP as 

a model for how to expand evidence-based practices.24 Ron Haskins, a former Ways 

and Means Human Resources Subcommittee Staff Director, described PREP and 

TPPP as case studies of evidence-based policymaking in his book Show Me The Evidence.25 PREP is also highlighted in the Results for America Invest in What Works 

Index of federal departments and agencies.26 Moreover, the federal list of evidencebased teen pregnancy prevention programs has become a resource for people around 

the country looking for effective programs, allowing states and communities to leverage their resources, without reinventing the wheel. Also, as the National Conference 

of State Legislatures has noted, the evidence-based approach to teen pregnancy prevention programs has inspired legislation in several states.27

A number of experts, including Ron Haskins, have referenced the importance of continual learning and evaluation as a hallmark of evidence-based policymaking. Both 

PREP and TPPP have made a serious commitment to evaluation, with a combination of national and grantee level evaluations.28, 29 This includes rigorously evaluating models that have already proven effective in past studies to see how they perform in additional sites and settings, rigorously evaluating promising programs to 

determine if they can demonstrate positive results, and collecting a host of granteelevel performance measures. They have also invested in technical assistance, training, and support for grantees to ensure high quality implementation. 

Ongoing commitment to evidence-based approaches to reducing teen pregnancy will 

not only improve outcomes for vulnerable children and families, but are also a costeffective investment.30 In fact, only about $1 out of every $100 spent on federal programs is backed by any evidence that the money is being spent wisely. At a time 

when leading experts—from The Brookings Institution to The Heritage Foundation 

to Results for America—and members of Congress are wisely and increasingly focused on ensuring that federally funded programs achieve results, and that they are 

rigorously evaluated in order to be sure that they do; PREP and TPPP are smart 

uses of taxpayer money. 

Reducing teen pregnancy helps reduce poverty, increase educational achievement 

and workforce competitiveness, and improve the health and well-being of children 

and families. PREP and TPPP help achieve this goal by adhering to high standards 

of evidence, focusing on outcomes rather than program content, and ensuring the 

83 

growth and support of a broad menu of proven program models that communities 

can choose from. Indeed, both programs embody many of the positive qualities of 

evidence-based programs highlighted by Finance Committee members and witnesses 

at the hearing, such as continual evaluation that allows for ongoing program improvement, the flexibility to respond to outcomes by replicating program models that 

demonstrate success, and the ability to refine what we know about what program 

models work best with specific populations and in specific settings. 

In closing, thank you for your commitment to evidence-based policymaking and improving the lives of vulnerable individuals and families. If you have any questions 

or need additional information, please contact me at 202–478–8554 or akane@ 

thenc.org. 

Sincerely, 

Andrea Kane 

Vice President, Policy and Strategic Partnerships 

—————————————————— 

1Kost, K., and Maddow-Zimet, I. (2016). U.S. Teen Pregnancies, Births and Abortions, 2011: State Trends by Age, Race and Ethnicity. Washington, DC: Guttmacher 

Institute. Retrieved May 23, 2016 from https://www.guttmacher.org/sites/default/ 

files/report_pdf/us-teen-pregnancy-state-trends-2011_4.pdf. 2The National Campaign to Prevent Teen and Unplanned Pregnancy. (2016). Teen 

Childbearing in the United States, 2014 Birth Data. Washington, DC: Author. Retrieved May 23, 2016 from http://thenationalcampaign.org/resource/teen-childbearing-united-states-2014-birth-data. 

3 Ng, A.S., and Kaye, K. (2013). Why It Matters: Teen Childbearing and Child Welfare. Washington, DC: The National Campaign to Prevent Teen and Unplanned 

Pregnancy. Retrieved May 23, 2016 from http://thenationalcampaign.org/resource/ 

why-it-matters-teen-childbearing-and-child-welfare. 

4 U.S. Centers for Disease Control and Prevention. (2016). Teen birth rates fall nearly 50 percent among Hispanic and black teens, dropping national teen birth rate to 

an all-time low. Atlanta, GA: Author. Retrieved May 23, 2016 from http:// 

www.cdc.gov/media/releases/2016/p0428-teen-birth-rates.html. 

5The National Campaign to Prevent Teen and Unplanned Pregnancy. (2014). Teen 

Pregnancy in the United States. Washington, DC: Author. Retrieved May 23, 2016 

from https://thenationalcampaign.org/resource/fast-facts-teen-pregnancy-unitedstates. 

6The National Campaign to Prevent Teen and Unplanned Pregnancy. (2016). Teen 

Childbearing in the United States, 2014 Birth Data. Washington, DC: Author. Retrieved May 23, 2016 from http://thenationalcampaign.org/resource/teen-childbearing-united-states-2014-birth-data. 

7 Ng, A.S. and Kaye, K. (2015). Sex in the (Non)City: Teen Childbearing in Rural 

America. Washington, DC: The National Campaign to Prevent Teen and Unplanned 

Pregnancy. Retrieved May 23, 2016 from http://thenationalcampaign.org/resource/ 

sex-non-city. 

8The National Campaign to Prevent Teen and Unplanned Pregnancy. (2013). Counting It Up: Key Data. Washington, DC: Author. Retrieved May 23, 2016 from https:// 

thenationalcampaign.org/resource/counting-it-key-data-2013. 

9Shugar, L. (2012). Teen Pregnancy and High School Dropout: What Communities 

Can Do to Address the Issue. Washington, DC: The National Campaign to Prevent 

Teen and Unplanned Pregnancy and America’s Promise Alliance. Retrieved May 23, 

2016 from https://thenationalcampaign.org/sites/default/files/resource-primarydownload/teen-preg-hs-dropout.pdf. 

10The National Campaign to Prevent Teen and Unplanned Pregnancy. (2015). Survey Says: Extend Not Eliminate. Washington, DC: Author. Retrieved May 23, 2016 

from http://thenationalcampaign.org/resource/survey-says-plus-july-2015. 11Kirby, D. (1997). No Easy Answers: Research Findings on Programs to Reduce 

Teen Pregnancy. Washington, DC: National Campaign to Prevent Teen Pregnancy. 

12Kirby, D. (2001). Emerging Answers: Research Findings on Programs to Reduce 

Teen Pregnancy. Washington, DC: National Campaign to Prevent Teen Pregnancy. 

13Kirby, D. (2007). Emerging Answers 2007: New Research Findings on Programs 

to Reduce Teen Pregnancy—Full Report. Washington, DC: The National Campaign 

to Prevent Teen and Unplanned Pregnancy. Retrieved March 30, 2015 from http:// 

thenationalcampaign.org/sites/default/files/resource-primary-download/EA2007_ 

full_0.pdf. 14Solomon-Fears, C. (2016). Teenage Pregnancy Prevention: Statistics and Programs. 

Washington, DC: Congressional Research Service. Retrieved May 23, 2016 from 

https://www.fas.org/sgp/crs/misc/RS20301.pdf. 

84 

15For an overview of these programs, see The National Campaign to Prevent Teen 

and Unplanned Pregnancy. (2016). Federal Funding Streams for Teen Pregnancy 

Prevention. Washington, DC: Author. Retrieved May 23, 2016 from http://the 

nationalcampaign.org/resource/federal-funding-streams-teen-pregnancy-prevention. 

16 Results for America. (2015). Invest in What Works Fact Sheet: Federal EvidenceBased Innovation Programs. Washington, DC: Author. Retrieved May 22, 2016 from 

http://results4america.org/policy-hub/invest-works-fact-sheet-federal-evidence-based 

-innovation-programs/. Also, Haskins, R. (2014). Show Me The Evidence. Washington, DC: Brookings Institution Press. 

17Lugo-Gil, J., Lee, A., Vohra, D., Adamek, K., Lacoe, J., and Goesling, B. (2016). 

Updated findings from the HHS Teen Pregnancy Prevention Evidence Review: July 

2014 through August 2015. Washington, DC: Mathematica Policy Research. Retrieved May 23, 2016 from http://tppevidencereview.aspe.hhs.gov/pdfs/Summary_ of_findings_2015.pdf. 18 Ayotte, K., Warner, M., Hubbard, G., Sperling, G., Barnes, M. Bridgeland, J., . . . 

Madden, K. (2014). Moneyball for Government. United States: Results for America. 19 Administration for Children and Families/Family and Youth Services Bureau. 

(2015). Adolescent Pregnancy Prevention Program Fact Sheet. Washington, DC. Author. Retrieved May 23, 2016 from http://www.acf.hhs.gov/programs/fysb/resource 

/app-fact-sheet. 

20 Administration for Children and Families/Family and Youth Services Bureau. 

(2015). Personal Responsibility Education Program: How States Planned and Implemented Adolescent Pregnancy Prevention Programs: State PREP Performance Measures of Structure, Cost, and Support for Implementation. Washington, DC: Author. 

Retrieved May 23, 2016 from https://www.acf.hhs.gov/sites/default/files/fysb/ 

prep_pm_brief_20151216.pdf. 21The number is a combined estimate from the State, Competitive, and Tribal 

PREP grants. See Administration for Children and Families/Family and Youth 

Services Bureau. State Personal Responsibility Education Program. Washington, 

DC: Author. Retrieved May 23, 2016 from http://www.acf.hhs.gov/programs/fysb/ 

resource/prep-fact-sheet; Administration for Children and Families/Family and 

Youth Services Bureau. Competitive Personal Responsibility Education Program. 

Washington, DC: Author. Retrieved May 23, 2016 from http://www.acf.hhs.gov/programs/fysb/resource/competitive-prep-fact-sheet; and Administration for Children 

and Families/Family and Youth Services Bureau. Tribal Personal Responsibility 

Education Program. Washington, DC: Author. Retrieved May 23, 2016 from http:// 

www.acf.hhs.gov/programs/fysb/resource/tribal-prep-fact-sheet. 

22 U.S. Department of Health and Human Services. (2015). Fiscal Year 2016 General 

Departmental Management Justification of Estimates for Appropriations Committee. 

Washington, DC: Author. Retrieved May 23, 2016 from http://www.hhs.gov/sites/ 

default/files/budget/fy2016/fy2016-general-departmental-budget-justification.pdf. 

23 U.S. Department of Health and Human Services. (2015). HHS awards Teen Pregnancy Prevention Program grants. Washington, DC: Author. Retrieved May 23, 2016 

from http://www.hhs.gov/about/news/2015/07/06/hhs-awards-teen-pregnancy-prevention-program-grants. 

24The Bridgespan Group. (2013). The Bridgespan Group Highlights Federal Teen 

Pregnancy Prevention Program as Model for How to Expand Evidence-based Practices. Boston, MA: Author. Retrieved May 23, 2016 from http://www.bridgespan. 

org/About/Media/The-Bridgespan-Group-Highlights-Federal-Teen-Pregn.aspx#.VRh 

10jTD86w. 

25 Haskins, R. (2014). Show Me The Evidence. Washington, DC: Brookings Institution Press. 

26 Results for America. (2016). Invest in What Works Index. Washington, DC: Author. Retrieved May 23, 2016 from http://results4america.org/policy-hub/2016-federal-invest-works-index/. 

27 Blackman, K. (2016). Evidence-Based Policies to Prevent Teen Pregnancy. Washington, DC: The National Conference of State Legislatures. Retrieved May 23, 2016 

from http://www.ncsl.org/documents/health/lb_2416.pdf. 28 U.S. Health and Human Services Administration/Office of Adolescent Health. 

(2015, July). TPP Resource Center: Evaluation. Washington, DC: Author. Retrieved 

May 23, 2016 from http://www.hhs.gov/ash/oah/DEPRECATED/evaluation-original/evaluation.html. 

29Mathematica Policy Research. Personal Responsibility Education Program Evaluation. Retrieved May 23, 2016 from http://www.prepeval.com. 30Sawhill, I., Thomas, A., and Monea, E. (2010). An Ounce of Prevention: Policy 

Prescriptions to Reduce the Prevalence of Fragile Families. Future of Children Vol. 

20 (2). Retrieved May 23, 2016 from http://futureofchildren.org/publications/docs/ 

20_02_07.pdf. 

85 

NONPROFIT FINANCE FUND (NFF) 

5 Hanover Square, 9th Floor 

New York, NY 10004 

Statement for the Record 

‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ 

May 10, 2016 

Nonprofit Finance Fund 

Nonprofit Finance Fund (NFF) is a national 501(c)(3) community development financial institution with over 35 years investing in and advising the social sector. 

We unlock the potential of mission-driven organizations through tailored investments, strategic advice, and accessible insights. NFF has partnered with a 

wide range of public and private providers of capital to develop and implement innovative and effective ways to increase the flow of capital to a chronically undercapitalized social sector. Throughout this time, we have also worked closely with the 

providers of services to empower them with the skills and capacity necessary to convert capital into meaningful, positive outcomes for the individuals, families and communities that they serve. We are a financial educator and trusted advisor to nonprofits and funders. We surface and communicate trends that emerge from serving 

thousands of organizations. 

NFF’s aspiration is to share the learnings from our work in the sector to help government and other stakeholders make public policy changes that benefit nonprofits 

and help them accomplish their mission. NFF is uniquely positioned for this work, 

building from a distinguished record of direct investment, advisory work and applied 

research. Our transactional experience in the trenches and our demonstrated ability 

to communicate complex financial concepts to nonprofit practitioners provide a 

unique and powerful base from which to move forward. NFF continuously advocates 

for the health and vitality of the social sector, providing critical insights in response 

to challenging environmental conditions, a sector-wide need for reform, public policy 

changes or lack thereof, and apparent fragility among organizations working in the 

current system. 

Pay for Success 

Pay for Success is a creative approach to funding social services, with potential to 

bring new, significant, and reliable resources to proven preventative programs. In 

a Pay for Success deal, private investors pay for preventative or interventional social services up front. Should these services deliver their intended results, governments then reimburse the investors with a return on their investment, while saving 

money on what they otherwise would have spent. It is a model designed to both improve outcomes and reduce costs. Pay for Success centers upon evidence-based practices that have demonstrated effectiveness in addressing some of society’s most intractable issues. From reducing chronic homelessness and jail recidivism, to improving early childhood education and health outcomes for vulnerable populations across 

the nation, Pay for Success is shifting the sector’s focus to the importance of understanding and scaling services that have demonstrated evidence of effectiveness and 

propelling states and counties across the United States to form multi-sector stakeholders aligned around shared outcomes goals. NFF believes that the system change 

work of aligning spending and program delivery around outcomes-oriented services 

requires the collaboration of public, private, nonprofit and academic stakeholders. 

PFS is but one tool that can catalyze this shift, but it has had a notable impact 

to date, bringing attention to innovative means to align resources around evidencebased programs. 

NFF’s Work in Pay for Success 

With the arrival of Pay for Success (PFS) in the United States in 2010, we at NFF, 

along with many others in the sector, recognized its potential to catalyze improved 

delivery of and investment in better social outcomes. Equally as important was the 

recognition that PFS also had the potential to motivate a needed discourse among 

service providers, traditional and new social sector investors, governments and other 

stakeholders in the sector on how to align their efforts to improve our society’s capacity to deliver better outcomes more cost effectively for the beneficiaries of social 

programs. 

86 

NFF continues to provide capital to the U.S. social sector through facility, working 

capital and bridge loans from our $80 million loan fund and New Markets Tax Credit transactions and to deliver strategic financial management advice and capacity 

building programs to service providers and providers of capital. We have also made 

a strong commitment to supporting an investigation of PFS’s potential and to systematically preparing the sector for outcomes-based financing of social services more 

broadly. 

Within this framework, the portion of NFF’s work devoted to the PFS space has focused from the outset on helping service providers, investors, and governments understand and build readiness for productive participation in a U.S. social sector 

where providing and accessing capital is increasingly tied to the achievement of 

meaningful and measurable outcomes. During this time, NFF has led sector-wide 

PFS education, outreach and convening efforts in close collaboration with multiple 

stakeholders, including the Rockefeller Foundation, the White House Office of Social 

Innovation and Civic Participation, William and Flora Hewlett Foundation, Joyce 

Foundation, DoL, DoJ, OMB and numerous other service providers, state and local 

government entities, intermediaries and researchers. Through these efforts and our 

Pay for Success Learning Hub (payforsuccess.org), which has attracted more than 

35,000 unique visitors, we aim to facilitate a balanced, objective and transparent 

dialogue on the opportunities and challenges PFS presents for all of us in the social 

sector. 

Throughout this period, our PFS work has also focused on capacity building initiatives to better prepare service providers, investors, and governments for collaborative participation in an outcomes-based funding world. With support from the 

Rockefeller Foundation in 2013, NFF designed and led readiness incubators and accelerators for cohorts of service providers in five geographies across the country. 

Governments, funders and high performing service providers in each of these targeted locations are advancing outcomes-based finance strategies such as PFS to test 

the potential of these approaches to deliver better outcomes and provide a supplemental, cost-effective source of capital for vital social service programs. 

As NFF begins its 35th year serving the capital, capacity building and thought partnership needs of the social sector, we are very excited about our growing diverse 

and integrated portfolio of capital access and capacity building work. Most recently, 

in partnership with the Corporation for National and Community Service (CNCS) 

Social Innovation Fund, and the Laura and John Arnold Foundation, NFF has 

launched an initiative that will award a total of $2.88 million, through an open, 

competitive grant competition, over 2 years to support Pay for Success transaction 

structuring efforts across the U.S. Additionally, with the support and partnership 

of Irvine Foundation, NFF continues to oversee a statewide initiative in California 

designed to catalyze Pay for Success transactions by sharing expertise, building 

leadership and aligning the efforts of a diverse set of stakeholders, such as service 

providers, investors, intermediaries and government. Furthermore, in 2013 NFF received an award of $1.347 million from the Community Development Financial Institutions Fund Program Award to attract additional capital to invest in Pay for 

Success transactions. We have invested these funds into two county-level Pay for 

Success projects: the Cuyahoga Partnering for Family Success Program in Cuyahoga 

County, OH and the Housing to Health Initiative in Denver, CO. 

Insights to Share With the Senate Finance Committee 

• Allocation of federal funding to support state and local PFS projects in the form 

of back-end payments is still critical to market growth—this can take the form 

of the $300 million PFS Incentive Fund, proposed to be housed at Treasury Department, or RFPs put out by individual agencies as in the case of the HUD/ 

DOJ opportunity. 

• Federal government can also enable better outcomes by providing authority 

within existing budgets (as in WIOA, which allows for up to 10% of state block 

funding to be used in pay for performance arrangements) or by providing relief 

from regulatory constraints which prohibit agencies from blending funding and 

sharing data. One example of this is the Performance Partnership Pilot projects 

which allow states to blend different sources of discretionary and block grant 

money typically managed by different, non-collaborating agencies, and report on 

a single set of outcomes for projects serving disconnected youth. 

• Ongoing support for the Social Innovation Fund is critical, because it has dedicated resources to evaluation/building the evidence base through the SIF Classic competitions, as well as seed market growth in the PFS field. SIF has also 

played the role of field builder and educator about PFS and evidence within 

87 

government, and can continue to support other agencies in developing PFS 

RFPs and competitive funding opportunities that weight evidence and evaluation in their scoring. 

• In general, there is a greater need for federal resources for evaluation, as well 

as resources to support service provider capacity building to ready the field to 

engage in evaluations, and measure and report on outcomes. 

LETTER SUBMITTED BY DEBORAH PERIN

May 21, 2016 

Senate Committee on Finance 

219 Dirksen Senate Office Building 

Washington, DC 20510–6200 

Re: Full committee hearing held on May 10, 2016 entitled, ‘‘Can Evidence-Based 

Practices Improve Outcomes for Vulnerable Individuals and Families?’’ 

Dear Senate Committee on Finance: 

I am deeply concerned about how our child welfare system treats children and 

families once those families are involved with the child welfare. Families are often 

treated without compassion, and care is not taken to ensure parents are not falsely 

accused. In reality, if initial allegations are false, child welfare will often dig for reasons to stay in a family’s life and take their child. 

Let me give you a hypothetical example: 

Little Carly is playing out in front of her house. The neighbor sees the child playing, and because the child’s mom is not directly in her view, she assumes that the 

child is unsupervised. The neighbor chooses to call child welfare. A caseworker arrives at the house with two police officers; they say that they had an anonymous 

call about their small child playing out front without supervision and they insist 

that it is necessary to come in the house to check on the child. The parents, feeling 

that they do not have a choice, invite the caseworker and the police officers into 

their home. 

The mother states, ‘‘I am in the process of cleaning out some closets so please excuse the mess.’’ The mother then explains to the caseworker that she was watching 

her child on the day someone claimed the child was alone, and that she would never 

dream of leaving her child unsupervised. The caseworker checks Carly for outward 

signs of abuse and then insists on looking in the refrigerator and in the child’s bedroom. 

The caseworker writes in her notes, ‘‘The house is a mess and dishes are piled 

up in the sink.’’ In reality, the breakfast dishes are in the sink and the house is 

only a mess because as the mother had said, she was cleaning out some closets. The 

caseworker then asks the parents if they have ever abused drugs or alcohol. The 

dad reveals that he had a problem with alcohol, but that he went through rehabilitation and has been clean for 10 years. 

The caseworker writes down, ‘‘Father is an alcoholic.’’ The caseworker says to the 

mother, ‘‘The child has a small bruise on her lower leg.’’ To which the mother says, 

‘‘She fell down 2 days ago while we were playing at the park.’’ The caseworker 

writes down, ‘‘Child has a bruise on her leg, possible abuse.’’ 

At this point, the caseworker tells the mother and father that their child is being 

taken into custody and they will be contacted concerning a court date. Over the next 

few months, the mother and father are given a case plan by child welfare and each 

of them is assigned their own court-appointed attorney. 

Each parent is then told by their own court-appointed attorney to sign the case 

plan, and that if they truly want their children back, they will need to separate from 

each other. Over the next few months, the parents contact their attorneys regularly 

trying desperately to figure out how to get their daughter back. Their calls are ignored. 

At his court-appointed attorney’s request, the father leaves the family home, and 

moves in with his mother and father. Both parents follow the case plan, which 

states that the parents will be required to attend parenting classes, psychological 

evaluations, and psychotherapy. The father is also required to attend AA meetings 

and take weekly urine tests. In addition, both parents must allow background 

88 

checks and access to their old high school records. Child welfare also demands access to Carly’s medical records and school records. 

Over the next several months, the parents never miss a visit with Carly even 

though the visit days and times change quite frequently. When the parents ask for 

more visitation, they are told that is not possible, and they will just have to be 

happy with two supervised visits per week, at one hour apiece. 

When the parents go to family court, the judge listens to the caseworker who 

says, ‘‘The child was living in filthy conditions, she was obviously being abused and 

neglected. In addition, the father is an alcoholic.’’ The caseworker continues by saying, ‘‘The child needs to stay with the foster family.’’ The caseworker also says, ‘‘This 

is the best course of action.’’ The family court judge agrees. Carly’s court-appointed 

attorney agrees. The mom’s court-appointed attorney agrees. The father’s courtappointed attorney agrees, and the CASA agrees. 

Upon looking at the child’s school records, the caseworker reads that little Carly 

‘‘has some issues paying attention in class’’ and ‘‘the teacher asked the parents to 

have her evaluated for ADHD.’’ The record continues saying, ‘‘The parents stated 

that they did not want to medicate their first grader and they were hoping the 

school had other options.’’ The caseworker writes in her file, ‘‘Parents refuse to 

medicate their ADHD child. Parents are medically neglecting their child.’’ 

Months go by and the parents have slowly seen their child become emotionally 

detached from them. The psychological evaluations of the parents say that both parents are ‘‘depressed and maybe a little paranoid that the system is out to get them.’’ 

According to the psychologist hired by child welfare, the parents were ‘‘desperately 

in need an intervention from child welfare.’’ 

During psychotherapy, with the psychologist hired by child welfare, the parents 

admit that they are living separately because their court-appointed attorneys felt 

they would have a better chance of getting their child back if they were to live separately. The psychotherapist writes, ‘‘Parents are not living under the same roof. 

There is concern about contention between the parents. This is an unsafe environment for the child.’’ 

During the months following Carly’s removal from her family, family members 

have stepped up and offered to take Carly in during the child welfare investigation. 

This request is denied by child welfare. 

Carly’s parents only hear from their court-appointed attorneys right before a court 

appearance is imminent and their attorneys do not return their phone calls. In addition, their attorneys just seem to agree with whatever the family court judge says, 

and Carly’s parents finally realize that they are completely on their own because 

they don’t have the funds to hire their own attorney. 

Hoping to prove they are good parents, Carly’s mom and dad obtain a statement 

from Carly’s pediatrician stating that she was seen regularly, and that the doctor 

never had concerns of abuse. This paperwork is ignored by child welfare. Friends 

and acquaintances offer statements stating the parents are of good character. This 

information is also ignored by child welfare. In addition, the father’s court-ordered 

urine tests for alcohol use have been clean every time, but no mention of this has 

been made in court by child welfare. 

Around 15 months after their child was taken from them, the caseworker tells the 

judge that the child is deeply bonded to the foster family and it would be in Carly’s 

best interests to be adopted. Each parent gets a letter stating that the state is moving forward with termination of parental rights. Upon speaking to their courtappointed attorneys, the parents are told they have two options. 

Here are the parents’ two options: 

#1 Sign away your parental rights and be given 2 to 3 supervised visits per year 

under a Post Adoption Visitation Agreement. A court-approved visitation specialist 

will supervise these visits, and you, the parent, will pay the hourly fee for that supervisor. If you sign your rights away voluntarily, this is called a voluntary adoption. Because it is voluntary, and your rights are not being terminated by the state, 

we will not step in and seize future children should you have more in the future. 

#2 Go to trial and if you lose, you will not be allowed any visitation after your 

child’s adoption. You will also have lost your parental rights through state intervention and so any future children will be taken from you at birth, and we are under 

no obligation to return those children to you. 

89 

➢ The story above was not based on one family’s experience with child welfare. 

Instead, it is based on the general experiences of several families. This story 

was meant to show the rabbit hole that parents are forced to go down while 

dealing with child welfare. 

It would be nice if we could depend on child welfare to behave morally regardless 

of where the federal funding is allocated. However, it is obvious that their goal is 

to tap the most lucrative funding sources. 

I have seven suggestions to improve child welfare: 

#1 Prioritize keeping parents and children together from day one. Parents and children need to stay together while services are offered to families unless it is determined that the child is in imminent danger. 

➢ Who determines that the child is in imminent danger? It cannot be child welfare. Not while they are still receiving massive funding for removals and adoptions. 

#2 Remove mandatory reporting which often scares people into reporting even the 

smallest detail for fear of losing their job or license. Instead of trusting child welfare 

agencies completely, we need to start putting more faith in the average professional 

to report only when they deem it necessary. 

#3 Get rid of adoption incentives. 

➢ I realize that you might be hesitant to get rid of adoption incentives because 

you are worried about the children who would be stuck in foster care. However, offering adoption incentives has only caused child welfare to look for 

more children to place instead of just placing the children they already have. 

#4 Create a funding structure that strongly favors returning children to their families over adopting them out to another family. 

#5 Family courts need a jury of 12. Criminals get a jury partly because they may 

be up against a life sentence or even a death sentence. I say with all honesty that 

parents are up against the same cruel punishment within our family courts. Losing 

a child is worse than death. 

➢ Give parents a jury of 12 in family court. 

#6 Give parents ongoing surveys with open-ended questions. Give those surveys to 

extended family members and friends of the family who are involved with child welfare, and allow them to give input as to how child welfare is treating that family. 

Are they helping or hindering? See if they feel the child’s best interests are being 

valued. 

➢ Obviously, child welfare would not be put in charge of those surveys nor would 

they be in charge of handing down their own sanctions. 

#7 Perform yearly audits on child welfare and impose sanctions on them for misdeeds. 

I often hear people say quite often that child welfare does not protect children who 

are truly abused. I believe this to be true for two reasons. 

Reason #1, child welfare has filled its system with children who never should have 

been taken from their parents in the first place. As a result, caseworkers have too 

many cases assigned to them. 

Reason #2, when child welfare changed to a system that is 100% focused on child 

removals and adoptions, they sought to obtain children who were adoptable. Potential adoptive families are drawn to a child who was well taken care of, but whose 

parents fell on hard times and received no help. The adoptive families are told that 

the well taken care of child was abused, and so believing they are saving a child, 

they choose to adopt. 

Because I understand that this is a difficult topic and valuable insight is critical 

to making child welfare better, I have included some names of individuals on the 

following pages who may be able to offer you that valuable insight while the committee works on a valid solution. We do not want abused kids sitting in foster care, 

but we do not want our individual states to continue kidnapping children to obtain 

federal incentives. 

Molly McGrath Tierney is the head of child welfare in Boston. 

90 

Ms. McGrath Tierney was part of a documentary called ‘‘On the Other Side of 

Fear: A Reinvention of the Foster Care System.’’ The trailer for that film can be 

found on Vimeo or YouTube. She also put out an exceptional TedTalk entitled ‘‘Rethinking foster care: Molly McGrath Tierney at TEDxBaltimore 2014’’ that is also 

on YouTube. 

Ms. McGrath Tierney seems to understand that the foster care system is broken 

and genuinely seems to want to come up with answers. I do not know her personally, but I am hoping that she genuinely wants something much better for kids. 

That fact that she has insider knowledge may make her a good choice for the Senate 

Finance Committee to consult with. 

If you want to read more about her, you can find a 2015 article put out by the 

Baltimore Sun entitled, ‘‘Former city social services chief returns to head agency.’’ 

According to that article, she has ‘‘advised government groups and nonprofits in 

management strategy and delivery of social services.’’ 

Molly McGrath Tierney 

Baltimore City DSS 

Talmadge Branch Building 

1910 N. Broadway Street 

Baltimore, Maryland 21213 

Phone: 443–378–4600 

Shawn McMillan is an attorney in California. 

News articles concerning Shawn McMillan: 

http://www.nbcsandiego.com/news/local/Mother-Custody-Settle-San-DiegoJohnneisha-Kemper-Shawn-McMillan-278899941.html 

Class Action Lawsuit Filed Against Orange County (CA) Child Protective Services 

Alleges Unwarranted Seizure of Thousands of Children 

http://www.prweb.com/releases/2015/04/prweb12668689.htm 

Shawn McMillan 

4955 Via Lapiz 

San Diego, CA 92122 

Phone: 858–646–0069 

Fax: 206–600–4582 

http://www.mcmillan-law.com/?cmd=Shawn 

Robert Powell is an attorney in California 

His website says, ‘‘Attorney Robert Powell has been representing parents in CPS 

and Juvenile Dependency cases for over 16 years. In addition, the firm handles federal civil rights cases associated with the unlawful removal of children and deprivation of a family’s right to association.’’ 

In the YouTube video below, Robert Powell is one of the individuals speaking about 

the problems with child welfare. 

‘‘In the Interest of the Children CPS Exposed—Freedom’’ 

Forum: https://www.youtube.com/watch?v=k5JZx5J5W5U 

Robert Powell 

925 W. Hedding St. 

San Jose, California 95126 

Phone: 408–553–0200 

Fax: 408–553–0203 

http://www.rrpassociates.com/cps_defense.html 

Carin Johnson is an attorney in California. 

Her website says . . . 

‘‘Attorney Carin Johnson heads the firm’s parental rights and juvenile law practice. 

Mrs. Johnson has been passionately defending parents, grandparents, foster parents, and family members’ rights in the state of California for over 17 years and 

has successfully defended thousands of clients in Child Protective Services and Division of Child and Family Services Juvenile Dependency Court.’’ 

In the YouTube video below, Ms. Johnson is one of the individuals speaking about 

the problems with child welfare. 

‘‘In the Interest of the Children CPS Exposed—Freedom’’ 

Forum: https://www.youtube.com/watch?v=k5JZx5J5W5U 

91 

Carin L. Johnson 

2125 Oak Grove Rd., Suite 315 

Walnut Creek, CA 94598 

Phone: 925–290–6001 

Fax: 925–952–8902 

http://www.duilawyerwalnutcreek.net/walnutcreekduilawyercarinljohnson.html 

The four individuals listed above may not be able to help you with finance plans, 

but they would be able to give the Senate Finance Committee insight into what is 

deeply wrong with child welfare. Of course, speaking to families who have been 

robbed of their children would also give you additional valuable insight, and I hope 

that you will consider listening to affected families before you suggest a new law 

concerning child welfare. I personally would love the opportunity to speak to the 

Senate Finance Committee in person and discuss how to turn child welfare around. 

Neither adoption nor foster care is the correct permanent solution for temporary 

problems. 

Sincerely, 

Deborah Perin 

QUANTIFIED VENTURES

1875 Connecticut Avenue, NW, 10th FL 

Washington, DC 20009 

+1–202–734–3712 

http://www.quantifiedventures.com/ 

U.S. Senate 

Committee on Finance 

Dirksen Senate Office Bldg. 

Washington, DC 20510–6200 

Re: Committee Hearing: ‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ held on May 10, 2016 

Dear Chairman Hatch, Ranking Member Wyden, and distinguished members of the 

U.S. Senate Finance Committee: 

On April 27, 2015, Senator Orrin Hatch (R–UT) and Senator Michael Bennett (D– 

CO) introduced the Social Impact Partnership Act (S. 1089), a bipartisan bill that 

aims to achieve better outcomes for social service program beneficiaries and taxpayers. Quantified Ventures strongly supports Social Impact Partnership Act (S. 

1089). We believe that in order to get the highest return on taxpayer investment 

government should pay providers after they have demonstrated success, not based 

on their potential for success. A Pay for Success project has the potential to build 

evidence, encourage innovation, and create incentives for non-federal investment. 

Quantified Ventures works with nonprofit organizations, entrepreneurs, and governments across the county who demonstrate capacity for transformative social good. 

We help scale operations and deliver meaningful impact. What we have seen from 

our work is diverse communities, Republican and Democratic elected officials and 

community service providers coming together to improve outcomes for the people 

they serve. 

Pay for Success is a promising model for scaling important interventions while saving governments money in the long term. This model has tremendous potential for 

accruing savings to the federal government while improving outcomes, and we 

therefore ask that you support these efforts. Thank you for your consideration of 

these comments. 

READYNATION

1212 New York Avenue, NW | Suite 300 | Washington, DC 20005 

V: 202–408–9282 | F: 866–215–2576 | info@readynation.org 

www.ReadyNation.org | www.facebook.com/ReadyNation | Twitter: @Ready_Nation 

May 17, 2016 

The Honorable Orrin Hatch The Honorable Ron Wyden 

U.S. Senate U.S. Senate 

92 

104 Hart Senate Office Building 221 Dirksen Senate Office Building 

Washington, DC 20515 Washington, DC 20510 

Dear Chairman Hatch and Ranking Member Wyden, 

We thank you and the members of the Senate Finance Committee for hosting the 

pertinent and timely hearing, ‘‘Can Evidence-Based Practices Improve Outcomes for 

Vulnerable Individuals and Families?’’ on Tuesday, May 10. Specifically, we were 

pleased that the witnesses affirmed the value of Pay for Success (PFS) initiatives, 

which create innovative partnerships to solve social issues and ensure money is 

spent wisely on evidence-based interventions for children and families. We deeply 

appreciate your commitment to this issue. 

With over 1,400 business leader members across the country, ReadyNation believes 

that targeted investments in education lay the foundation for an adequately prepared workforce and a robust American economy. Specifically, the Pay for Success 

financing approach embodies business principles of making the best use of existing 

funds, and investing early in order to prevent problems before they happen. Pay for 

Success financing can be applied to a wide variety of social programs, including 

high-quality early childhood and voluntary home visiting programs. This approach 

will reduce taxpayer burdens and produce positive returns for young children and 

their families, for taxpayers, and for county, state, and the federal government. 

We encourage the Finance Committee to report the Social Impact Partnership Act 

(S. 1089) out of committee and continue to examine these ground breaking investment methods. Pay for Success has the potential to be a critical means of improving 

social services delivery, promoting better outcomes for the populations served, and 

demonstrating meaningful returns to policymakers and the general public. 

ReadyNation recognizes the important implications of this hearing and commends 

you for your leadership. We look forward to working with you on this and other initiatives to improve the long-term outcomes of young children and families in the future. 

Sincerely, 

Sara Watson, M.P.P., Ph.D. 

Global Director 

RESULTS FOR AMERICA

1875 Connecticut Avenue, NW, 10th Floor 

Washington, DC 20009 

U.S. Senate 

Committee on Finance 

Dirksen Senate Office Bldg. 

Washington, DC 20510–6200 

Re: Committee hearing: ‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ held on Tuesday, May 10, 2016 

Dear Chairman Hatch, Ranking Member Wyden, and distinguished members of the 

U.S. Senate Finance Committee: 

On April 27, 2015, Senator Orrin Hatch (R–UT) and Senator Michael Bennett (D– 

CO) introduced the Social Impact Partnership Act (S. 1089), a bipartisan bill that 

aims to achieve better outcomes for social service program beneficiaries and taxpayers. The bill directs resources to states and local communities to support innovative public-private partnerships in an effort to tackle social and public health challenges and establishes a new system for a smarter and more effective use of tax dollars. Under the bill, the federal government would establish desired outcomes to 

pressing social problems that, if achieved, would improve lives and save taxpayer 

dollars. 

Results for America supports the Social Impact Partnership Act because it demonstrates the federal government’s commitment to leverage private investment, 

hard data, and rigorous evaluation to achieve better outcomes. We strongly urge the 

Committee to garner robust support for the Social Impact Partnership Act to bolster 

social sector innovation and to motivate the federal government to shift to results 

oriented approaches when serving our nation’s most vulnerable populations. 

93 

1 James Heckman, Seong Hyeok Moon, Rodrigo Pinto, Peter Savelyev, and Adam Yavitz, ‘‘A 

New Cost-Benefit and Rate of Return Analysis for the Perry Preschool Program: A Summary,’’ 

NBER Working Paper Series (2010), http://jenni.uchicago.edu/papers/Heckman_Moon_etal_ 2010_NBER_wp16180.pdf. 2 Investing in Our Future: The Evidence Base on Preschool Education, Foundation for Child 

Development and Society for Research in Child Development (October 2013), http://fcd-us.org/ 

sites/default/files/Evidence%20Base%20on%20Preschool%20Education%20FINAL.pdf. 3 Julia B. Isaacs, ‘‘Starting School at a Disadvantage: The School Readiness of Poor Children,’’ 

Center on Children and Families at Brookings (March 2012). 4 ‘‘Early Childhood Education in the U.S.,’’ Save the Children USA (2015). Print. 

SAVE THE CHILDREN ACTION NETWORK (SCAN) 

899 North Capitol Street, NE, Suite 900 

Washington, DC 20002 

Written Testimony of Mark Shriver, President 

Chairman Hatch, Ranking Member Wyden, and honorable members of the committee, thank you for the opportunity to provide testimony about the use of evidence-based practices to improve outcomes for vulnerable individuals and families. 

My name is Mark Shriver, and I am the President of Save the Children Action Network (SCAN). SCAN is a national, non-profit organization aiming to mobilize Americans in support of critical investments in early childhood education. 

SCAN supports expanding access to high-quality early childhood education programs for all children, especially the most vulnerable and at-risk. For this reason, 

SCAN is pursuing a number of innovative financing mechanisms to drive more resources toward early childhood education. One of the methods that has received significant bipartisan support is Pay For Success, a model supported by the Social Impact Partnership to Pay for Results Act (S. 1089) and its companion legislation in 

the House. 

Background 

Participation in high quality Early Childhood Education (ECE) programs is critical 

for children. During the first 5 years of life, a child develops many of the skills necessary to become successful. It is during these years that children build the foundation necessary for academic success in key subjects, including reading, math, and 

science, as well as the skills necessary for character building, social-emotional 

growth, gross-motor development, and executive functioning—including everything 

from impulse control to problem solving. 

In addition to putting kids on the path to success, early education has lasting economic benefits as well. Nobel-prize winning economist James Heckman has found 

a return on investment of $7 for every $1 invested in preschool.1, 2

Unfortunately, two out of five American children are not enrolled in preschool. 

Without access to high quality early learning programs, children fall behind and 

many never catch up. By age 5, more than half of all American children are not 

prepared for school.3 Early education—starting at birth and continuing until a 

child’s first day in kindergarten—is a critical window for ensuring future academic 

achievement. This window, however, closes quickly, and children who enter kindergarten unprepared are more likely to experience serious negative social impacts. 

Disadvantaged children who do not participate in high quality early education programs are: 

• 70 percent more likely to be arrested for a violent crime; 

• 60 percent more likely to never attend college; 

• 50 percent more likely to be placed in special education; 

• 40 percent more likely to become a teen parent; and 

• 25 percent more likely to drop out of school.4

It is critical to ensure that all children, regardless of their families’ income, have 

access to high quality preschool and comprehensive early education and family engagement programs. 

Financing 

We know government budgets are tight, and funding is often the largest hurdle in 

the debate to expand early education. While SCAN strongly supports robust government funding for early learning programs, we also advocate for additional innovative financing mechanisms to further increase access to high-quality early childhood 

education in common-sense, cost-effective ways. 

94 

One of these mechanisms is the Pay for Success (PFS) model, also known as Social 

Impact Bonds (SIBs). In a PFS program, the government repays investors for services they agree to pay for up front—but only if an evidence-based program achieves 

predetermined results. Pay for Success is based on generating savings for taxpayers 

through privately funded social services, like preschool programs, job training, housing assistance or other interventions. Those savings are then measured, with the 

government keeping a portion and the original investors receiving a limited portion. 

If the programs prove effective, the investors are repaid. If they are not effective, 

the government is not on the hook for a single penny. 

These partnerships formed between the private and public sectors save taxpayer 

money and deliver high-quality, measurable results. Most importantly, Pay for Success programs can help supplement existing funding; they do not replace traditional 

government spending for these important programs. 

Here is how it works. In most cases, a state or local government identifies a need 

in their community and then contracts with private investors to front the money for 

a specific social service. Participating nonprofits manage the project while a third 

party conducts a rigorous, independent evaluation at the conclusion to determine if 

the desired outcomes were achieved. The government then pays investors back if the 

desired, predetermined outcomes are achieved. Both the investors and the state or 

local government must approve the outcome metrics in advance, and an independent, third-party evaluator is tasked with determining if the metrics are met. 

Because of this structure, Pay for Success initiatives are a minimal risk to taxpayers, but also enable innovative and nimble service providers to tackle significant 

societal challenges. One Pay for Success program in Utah is already making a difference in the lives of children. This program paid for 595 at-risk, low-income 3- and 

4-year-olds to attend high-quality preschool in the 2013–2014 school year. Based on 

a predictive standardized test, 110 of these students were determined to be likely 

to need special education intervention. After one year in high-quality preschool, only 

one of the 110 identified students needed special education services in kindergarten, 

significantly reducing remediation costs for the school district. 

Utah then kept part of the savings, with the rest going toward paying back the initial investors. It was agreed in the initial contract that the investors’ return could 

not be higher than 5% over the municipal bond rate (for a total maximum return 

of 7%). This is a fairly modest return for an investment that could be considered 

relatively risky. 

Some critics have pointed to the high success rate of this program as an issue. The 

developers of other PFS programs are taking the lessons learned in Salt Lake City 

and refining the metrics used to determine success. Nevertheless, the fact that 600 

children in Utah, who would not have had a seat in a pre-K classroom and reap 

its benefits, can now attend, is a big step in the right direction. Additionally, the 

Utah program benchmarked payments on those children who are the furthest behind or hardest to serve. The early enrollment of students also led to a number of 

students receiving Special Ed services a year earlier due to earlier identification of 

learning disabilities. 

The initial results of Pay for Success programs in the U.S. have shown that this 

promising financing method eliminates investments in programs that are ineffective 

and reduces long-term costs through effective, results-driven programs that avoid 

future government spending on remedial services. 

Conclusion 

On behalf of Save the Children Action Network, and our advocates across the country, I want to thank the committee for examining evidence-based practices as a way 

to benefit vulnerable individuals and families. We strongly support the Social Impact Partnership to Pay for Results Act (S. 1089) and believe the programs it would 

make possible will be an important way to expand early childhood education. We 

ask for your continued partnership in investing in children, increasing access to opportunity, and ensuring a more prosperous America for generations to come. 

95 

SOCIAL FINANCE

10 Milk Street, Suite 1010, Boston, MA 02108 

T 617–939–9900 www.socialfinance.org 

May 19, 2016 

U.S. Senate 

Committee on Finance 

219 Dirksen Senate Office Building 

‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and 

Families?’’ 

May 10, 2016 

On behalf of Social Finance, I applaud Congressmen Young and Delaney’s and Senators Bennet and Hatch’s leadership and support for the Pay for Success market 

through the Social Impact Partnerships to Pay for Results Act, H.R. 5170. 

The federal government plays a catalytic role in advancing initiatives by innovative 

state and local governments and we commend its bipartisan leadership and focus 

on promoting innovative, outcomes-focused policy. As practitioners, we witness firsthand how Pay for Success projects can be used to measurably improve the lives of 

people most in need by driving resources toward better, more effective programs. 

H.R. 5170 would promote and support the use of Pay for Success by state and local 

governments by enabling federal funds to address community identified needs using 

interventions that are effective, evaluated, and provide value to taxpayers. It would 

incentivize the more efficient use of government resources to reward what works. 

As you appreciate, government spends hundreds of billions of dollars each year on 

necessary human services, but for the most part, does not measure the outcomes 

of those programs. Government also focuses the bulk of its appropriations on tackling existing problems instead of investing in upstream, preventative interventions 

that set people up for long-term success. 

Pay for Success represents one tool for governments to tackle current social challenges, such as reducing recidivism as part of the growing effort to reduce incarceration rates, confronting chronic homelessness to lower the number of people living 

on the streets, and boosting early education efforts to help narrow the widening 

achievement gap. It allows philanthropy and impact investors to leverage their financial support to expand access to high impact interventions. It also drives innovation by service providers to most effectively respond to our most critical social needs 

and our most vulnerable citizens. 

Pay for Success projects combine nonprofit expertise, private funding and rigorous 

evaluation to transform how government leaders respond to chronic social problems. 

Funders provide upfront capital to expand effective social services and governmental 

entities pay for all or part of the program only if it measurably improves the lives 

of participants. Independent evaluators measure the effects of a program based on 

specific, predetermined metrics that benefit both individuals and society and generate value for taxpayers. 

Take, for example, Social Finance’s work on the South Carolina Nurse-Family Partnership (NFP) Pay for Success project. This initiative, which was announced by Governor Nikki Haley in February 2016, will bring NFP’s evidence-based program to 

3,200 first-time mothers and their babies across South Carolina over the next 6 

years, more than doubling the 1,200 families currently benefiting from this highimpact intervention. 

More than 280,000 South Carolina children—or about 27 percent—live in families 

struggling with poverty. Half of the babies in South Carolina are born to low-income 

mothers who qualify for public health insurance programs. Young mothers living in 

poverty are at greater risk for poor birth outcomes including delivering premature 

babies. Growing up in poverty can be harmful to a child’s cognitive development, 

health, school performance, and social and emotional well-being. 

NFP pairs vulnerable first-time mothers with registered nurses who have specialized training in maternal and child health. Through home visits from early in pregnancy to the child’s second birthday, the nurses support mothers in having healthy 

pregnancies, becoming knowledgeable and responsible parents and giving their babies the best possible start in life. By strengthening families and improving early 

childhood development, NFP helps break multi-generational poverty. 

96 

This example highlights an important feature of Pay for Success: it holds a unique 

position in the growing impact investment landscape. While there is a lot of attention in impact investing given to profit-driven social enterprises, Pay for Success 

mobilizes capital primarily for nonprofits like NFP—classic human-service organizations that have long survived by scrapping together donations in annual development drives, securing government contracts, or both to keep the doors open and 

services running. 

By enabling these organizations to access upfront, patient, and flexible capital, Pay 

for Success builds a pathway to scale for an entire sector doing incredible work that 

has been historically overlooked by the capital markets. Additionally, in a Pay for 

Success project, there is a direct connection between every project stakeholder and 

tangible human impact. Success is measured based on the life outcomes of individuals—healthy births, employment gained, stable housing—and these life improvements are the source of financial returns. 

Against this backdrop, increased federal participation could mark an inflection 

point, spurring growth for Pay for Success and for the services it supports. This legislation would help solve the so-called ‘‘wrong pockets’’ problem, in which the value 

of a given program is dispersed across different levels of government, stalling funding even for programs with proven effectiveness. For example, if a particular state 

agency is expected to bear the brunt of the costs of a preventative program, but sees 

little benefit in their budget’s bottom line, there is little incentive to implement that 

program. Any social issue where a federal program pays for services, such as Medicaid, will require a federal commitment to pay for outcomes when savings and 

value are realized. 

Social Finance’s work with NFP in South Carolina led the state to apply for a waiver from the Centers for Medicare and Medicaid Services (CMS) to access the federal 

portion of Medicaid funding—in essence solving the ‘‘wrong pockets’’ problem that 

the project would have otherwise encountered. This legislation would streamline the 

process of solving this challenge for projects throughout the country. 

We believe Pay for Success holds tremendous potential to address some of our most 

pressing social issues, and we believe that government can and should be more innovative in its approach to solving society’s greatest challenges. Passage of the Social Impact Partnerships to Pay for Results Act, H.R. 5170, is an important step towards that goal. 

Sincerely, 

Tracy Palandjian 

CEO and Co-Founder, Social Finance 

Co-Chair, U.S. Impact Investment Alliance 

THIRD SECTOR CAPITAL PARTNERS, INC. 200 Clarendon Street, 44th Floor 

Boston, MA 02116 

www.thirdsectorcap.org 

U.S. Senate 

Committee on Finance 

Dirksen Senate Office Bldg. 

Washington, DC 20510–6200 

Re: Committee hearing: ‘‘Can Evidence-Based Practices Improve Outcomes for Vulnerable Individuals and Families?’’ held on May 10, 2016 

Dear Chairman Hatch, Ranking Member Wyden, and distinguished members of the 

U.S. Senate Finance Committee: 

Across the United States, communities continue to struggle with persistent challenges like homelessness, chronic and preventable diseases, and lack of access to 

education, and people cycling in and out of prison. These challenges represent immense social and financial costs—both to governments and taxpayers. 

On April 27, 2015, Senator Orrin Hatch (R–UT) and Senator Michael Bennett (D– 

CO) introduced the Social Impact Partnership Act (S. 1089), a bipartisan bill that 

aims to achieve better outcomes for social service program beneficiaries and taxpayers. The bill directs resources to states and local communities to support innovative public-private partnerships in an effort to tackle social and public health challenges and establishes a new system for a smarter and more effective use of tax dolVerDate Mar 15 2010 18:03 Apr 28, 2017 Jkt 000000 PO 00000 Frm 00100 Fmt 6601 Sfmt 6621 R:\DOCS\25244.000 TIMD
97 

lars. Under the bill, the federal government would establish desired outcomes to 

pressing social issues that, if achieved, would measurably improve lives. 

Third Sector Capital Partners, Inc., a nonprofit advisory firm, supports the Social 

Impact Partnership Act because it demonstrates the federal government’s commitment to leverage administrative data, private funding, and rigorous evaluation to 

achieve measurable outcomes. We strongly urge the Committee to garner robust 

support for the Social Impact Partnership Act to bolster social sector innovation and 

to motivate the federal government to shift to outcomes-oriented approaches when 

serving our nation’s most vulnerable populations. 

Æ