Social Impact Bonds for Public Health Programs: An Overview

Social impact bonds (SIB) are a financing mechanism that states use to support innovative programs focusing on the underlying social determinants of health. The desire to improve health care outcomes and reduce costs has led states to rethink how they deliver health care services, which is why governors are incorporating public health, community, social support and other nonclinical services into their efforts to transform their states’ health care systems. Governors can use a SIB model to provide funds to nonprofit organization that can successfully deliver social, health or educational services on a small scale. Several experiments are underway in states and cities across the country that use SIBs to finance innovative programs that improve access to quality health care and reduce the per-capita cost of care. Areas that such programs address include maternal and child health, substance abuse, diabetes management and general preventive health services.

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