The New Way to Govern: Paying for Progress

For too long, government has dumped millions of dollars into treating the effects of social ills without ever addressing their causes. Lacking funds or political will, it’s routine for legislators to salve the symptoms rather than cure the disease — let alone prevent new outbreaks. But the pioneers of a new public financing model claim there’s a better way for government to do business.
New partnerships between public and and private, known as social impact bonds (SIBs), are fronting the money for much-needed, underfunded social programs. More importantly, the sponsors argue, these bonds introduce data-driven performance metrics in order to find the greatest return for taxpayers.
These bonds redefine our conception of government. Striving to better the public good doesn’t cut it anymore. SIBs require programs to be successful and to do the work at a cheaper price. They also tilt the emphasis from activities to outcomes. Chances are, there won’t be a second New Deal or Great Society these days. But the innovators of this new form of financing hope to change government, using data to reshape it into an agile, efficient and performance-driven machine that can achieve our most ambitious goals.
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SIBs are generating buzz nationwide as an innovative way to fight the most intractable social problems, ones that indiscriminate government spending — without demanding innovation or results — has yet to make a dent in. The bonds (or as they’re now often called, “pay for success” contracts) allow nonprofits to scale their operations with private investment dollars. If their programs prove more efficient at solving problems than the current public services, corporate funders turn over long-term financial responsibility to the government. Taxpayers repay the investors’ up-front capital (with interest and a small return) only if the program works. Otherwise, if agreed-upon benchmarks aren’t met, the public’s off the hook — and backers lose their entire investment.
Governments are already using these bonds to address juvenile justice, chronic and family homelessness and early childhood education. Advocates say the alternative funding model allows cash-strapped governments to experiment with preemptive action that’s normally cut from tight budgets, rather than paying for expensive remedial programs later.
“If we procured music the same way we did social services, we’d all be listening to 8-track recording machines. Thirty years ago, we would have said, ‘This is great technology,’ and there’d be a law that you could only play music if it was on great technology just like this. That really is what social services look like in America,” says George Overholser, CEO and co-founder of Third Sector Capital Partners, a nonprofit with the goal of bringing data-driven performance metrics to government. The public sector has “a hard time recognizing when something new and better comes along,” he believes, but pay for success provides that for communities with “measurable ways that lives can be improved.”
Overholser’s firm serves as a “project intermediary” (essentially, a middle man) between lenders, the government and a nonprofit for the country’s largest SIB to date, an initiative that is aimed at reducing recidivism among at-risk young male inmates in Boston, Chelsea and Springfield, Mass., through behavioral interventions, educational prep and job training.
Here’s how it works: Third Sector Capital raised $18 million in cash from private investors — such as Goldman Sachs’s Social Impact Fund, plus five charitable foundations. Third Sector turns all of that money over to a service provider, in this case, Roca, Inc., a nonprofit that’s been around for 25 years and has developed a four-year program to help young men exit prison’s revolving door and enter the workforce. Over the next seven years, Roca will target a group of 929 men, ages 17 to 23, who are either on probation or aging out of the juvenile justice system.
“This project can be viewed as a laboratory. We are testing and evaluating the types of interventions to prove their worth, quantify their impact, and determine whether . . . this would make a meaningful impact on other young people,” Glen Shor, the state’s former secretary of Administration and Finance, tells The Boston Globe.
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With this bond, the investors are repaid by the government (which does not provide any initial funding) only if the program reduces re-incarceration by at least 5.2 percent compared to a control group. The goal, however, is to reduce recidivism by 40 percent. That may seem like a huge discrepancy, but it’s the level at which the Bay State will start saving money. Any less than that, and the program breaks even; any more, and the investors are entitled to a fraction of the savings — which are called “success payments.” That’s because the bonds operate just like any stock market investment, providing a return on a successful investment (though at a much more modest rate, given the risk compared to the market). For Roca and the nonprofit brackers (like Third Sector Capital, the criminal justice-focused The Arnold Foundation or Boston-based New Profit, Inc.), most of that return would be recycled into further scaling or future bond projects.
For a social impact bond to work, “so much needs to be just right: a rigorous way to evaluate impact, a strong cost-benefit analysis, a service provider that can scale with quality, government partners that are willing (and able) to engage deeply, investors and boards that have an appetite to understand and embrace new financial constructs, and last but not least, a willingness by all parties to communicate, communicate, communicate as the multiparty problem-solving process tumbles forward,” Overholser reflected as the Massachusetts initiative began.
The pay-for-success model has been thrown around among policy wonks as “the next big thing” since the early 2000s. During a time when public and charitable coffers are hard pressed to respond to all the existing need, SIBs emerged as a new stream of funding. Shortly after the first pilot project in England (also targeted at recidivism) launched in 2010, the model journeyed across the Atlantic. In 2012, New York City embarked on the first American bond to provide therapeutic treatment to teenagers locked up on Rikers Island, its central correctional facility.
Though none of those projects have been completed, the purpose of the model is already shifting from its early origins. For one, insiders now shy away from the initial term “bonds” since it’s a misnomer because investors aren’t guaranteed payback. More importantly, proponents argue that SIBs are not merely a new revenue stream, like municipal bonds, but a new way of doing business. Because all the funding is centered on data-based outcomes, it forces all the partners involved to rethink their programs. The public is paying for success, not services.
Many of the first bonds focused on recidivism and homelessness because they could be measured with simpler data sets and figures that were readily available — a person’s either in jail or not, for instance — but they are now targeting increasingly complex problems. Projects in Massachusetts and Denver, for example, started out with simple Housing First programs to provide homes to the chronically homeless. But a project launched in December in Cuyahoga County, Ohio, is targeting the much thornier issue of helping mothers who have been in homeless shelters avoid being separated from their children. Additionally, as data capabilities increase, pay for success programs promise to find the best investment of funds for problems like asthma, maternal depression and child welfare, advocates say.
“Historically, the obstacle was that we had no way of measuring social outcomes, but the information revolution has finally reached government,” Overholser says. “It’s now tuned not to what sounds good, but to what’s actually helping communities advance their goals. … We are, in a sense, retooling the way folks get paid to deliver services to the community.”
At city halls and statehouses across the country, lawmakers are studying whether to implement the pay-for-success model in their own jurisdictions. Currently, there’s seven projects underway in five states — rural and urban areas, red as Utah and blue as California — and at least 30 more on the horizon, says Nicole Truhe, government affairs director for America Forward, the nonpartisan public policy arm of New Profit, a venture philanthropy fund. Even the federal government is getting in on the action. Congress already approved legislation appropriating $600 million to assist in repaying bonds related to workforce development from successful state or local projects. Another bill pending would do the same for education dollars, Truhe adds.
“Elements of pay for success resonate with both conservatives and liberals,” she says. “There’s the cost savings efficiency piece to it, and there’s the focus on issue areas that are important to both parties, whether it be juvenile justice, early childhood education or healthcare.”
The question of whether social impact bonds will prove a lasting model or just the latest fad will likely depend on results from these early projects. Some skeptics say that private sector dollars are only being fronted for the bonds to boost a corporation’s image or even to make a profit. These observers say governments could realize the savings through their own pilot projects, innovation labs and direct contracting with established providers. Advocates respond, however, that mustering bipartisan political support for multi-year, multi-million-dollar projects hasn’t happened before and likely won’t anytime soon — especially since, as critics point out, the government must budget for full repayment of the bonds anyways, when a program is successful.
There’s also the question of how to calculate a government’s savings, some analysts worry. One problem stems from the concept of “fixed cost fallacy.” Calculating the expense for each day a prisoner spends in jail, for example, is often done by dividing the total cost of running the facility by the population. Keeping one person out of jail might mean saving on food and medicine, but there’s still the overhead costs, which don’t decrease unless the location is closed, argues David Juppe, senior operating budget manager for Maryland’s Department of Legislative Services. Another criticism leveled at SIBs is “creaming” — resolving the easiest cases or creating short-term gains in order to win success payments — and leaving the taxpayer to foot the bill for the long-term problems that remain unsolved, Juppe adds.
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While the full-scale calculations and evaluations are yet to be completed, Roca’s work is already improving the lives of those it reaches. Ralph Bonano, a 20-year-old who grew up across Boston’s Mystic River in the dense suburb of Chelsea, had been assigned to probation after an unarmed robbery. He tried to dodge Roca’s counselors, but they tracked him down and talked to him every chance they had.
After more than a year, Bonano finally softened and started attended Roca’s job training program. He now has a job in a manufacturing plant that makes military equipment and is working toward his G.E.D. Bonano says it gave him and “other kids an opportunity to change and to be treated as a normal person, not just a criminal.” He credits the program with helping him “stay out of jail.”
Before, Bonano’s story would be evidence of success. A life changed. Case closed. The intervention worked. But today, arbiters will consider Bonano as just one data point among many. Along with hundreds of other men, he’ll be entered into a complex calculation of avoided incarceration costs, Roca’s price of services, interest rates and income tax. Analysts will see whether Bonano fits the trend or is an outlier and question whether he changed enough to become a profitable member of society. In the emerging era of data-driven governance and payment for success, social good is only worth it if it saves us cash.
It’s still too early to tell whether Bonano is worth the price.
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Inside the Business of Turning Your Leftovers Into 33 Million Bags of Mulch

Waste, energy and agriculture. These three massive topics will affect how our ecosystem fares in the future. Harvest Power, a company founded in 2008, is providing local solutions that intersect all three. And they start by changing one unlikely place: the municipal dump.
Harvest Power takes discarded organic waste headed for incinerators or landfills and recycles it into usable electricity and soil. The company’s facilities use anaerobic digestion, a process where zillions of natural, microscopic bacteria eat away at the leftovers from your dinner plate and your front lawn, releasing a renewable biogas (essentially methane and carbon dioxide) that can be combusted to fuel electric generators. Any residual solids become nutrient-rich fertilizer.
Based out of Waltham, Mass., (a town north of Boston known for sparking the Industrial Revolution back in 1813), Harvest Power’s conversion results in 65,000 megawatt-hours of heat and electricity annually — enough to power 5,960 homes for a year — as well as 33 million (yes, million) bags of soil and mulch that are sold at Lowe’s, Home Depot and Walmart. The company derives all that power and compost from just 2 million tons of organic waste, which is just a sliver of the 251 million tons of trash (organic matter is the largest component) that North Americans throw out annually.
“We are proud of our current infrastructure to process organic waste, but this is only the beginning of what we hope is an organics waste revolution,” Kathleen Ligocki, Harvest Power’s CEO, tells NationSwell. “Organic waste processing is still a nascent market in North America. Harvest Power is already the leader in the space and we recognize that many more communities need our organics management solutions.”
One of the company’s most successful facilities is in Orlando, Fla., which accepts pizza crusts, fry trap grease and 130,000 tons of organic waste from the local hotels and restaurants at Disney’s Magic Kingdom. The electricity generated — 5.4 megawatt-hours — powers some of the rides and resorts at “The Happiest Place on Earth.” “We’re able to turn all the waste stream into productive products,” Ligocki tells the Guardian. Like something out of a classic Disney tale, the company transforms “pumpkins to power, waste to wealth.”
Another hub is located in California’s Central Valley. Known as America’s food basket, a significant portion of this country’s hay, alfalfa, tomatoes, grapes, garlic and almonds are harvested in the region, so it makes sense that Harvest Power put roots down in the region, accepting brush, branches and weeds for processing at its Fresno, Tulare and Lathrop locations.
The next step? To increase the amount of waste captured and processed for reuse. To do so, operating capacity at Harvest Power’s 40 existing sites will need to be expanded and more locations will need to be added, Ligocki says.
Getting there requires local action. Although Harvest Power operates across North America, from frosty Vancouver, Canada, all the way down to orange groves in Orlando, the company talks about “local renewable energy” and “local soils” nearly as often as they refer to the big picture across the continent. Commitment will have to begin in mayoral offices and neighborhood associations before a waste revolution can begin.
For this to happen, “the first step is recognition,” Ligocki says. “Communities identify organic waste as a panacea for interlocking issues [like] overflowing landfills, increasing greenhouse gas emissions, reduced soil health and the demand for clean energy.” As soon as cities realize there’s no need to truck organic scraps to faraway dumps, the Harvest Power model can take hold.
From there, the organic waste revolution could take two forms, Ligocki predicts: top-down or bottom-up. On one hand, government leaders could change trash heaps simply “by setting rates and policies in a way that divert the organic fraction [away] from the landfill-bound waste stream,” she explains. On the other, a grassroots movement could take hold of neighborhoods, leading innovators to step in and provide recycling services to “forward-thinking customers,” she adds.
Policy, financing, land, permits, community outreach and product distribution still must come together, but that’s where companies like Harvest Power, which oversees the process from start to finish, are making a real difference.
The movement already seems to be catching on. The company has won a trophy case of awards, including Bloomberg’s New Energy Pioneer Award in 2013 and has been named to the Global Cleantech 100, a list of the top private clean energy firms, for five years running. And recently, Harvest Power surpassed $300 million in financing, including support from Generation Investment Management, the firm Al Gore co-founded, and Waste Management, Inc., North America’s largest residential recycler.
Clearly, Harvest Power is onto something good.
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How Does One Man Reduce U.S. Dependency on Oil? He Starts with Trucks and Vans

When Clay Siegert is stuck in traffic behind a box truck, he doesn’t groan at the jumbo-sized gas-guzzler: He sees it as an opportunity.
As vice-president and co-founder of XL Hybrids, a Massachusetts-based company that converts commercial fleets to hybrid vehicles, Siegert is out to prove that the business of cargo transport doesn’t have to be a dirty one. XL Hybrids retrofits vans, minibuses and trucks by installing hybrid electric powertrains, so that every time a driver hits the brakes, a bit of kinetic energy is converted into valuable electricity. It’s a winning formula: The vehicles use 25 percent less gasoline, lowering carbon dioxide emissions while also reducing their company’s bottom line.
“When I see a truck going down the road with hybrid technology, I see less emissions, less oil being imported into the country,” Siegert says. “It’s more than just a truck or a van that drives somewhere. It’s those trucks that are going to drive hundreds of miles, maybe just that day. That adds up.”
Siegert spent more than a decade in various positions — at a firm trading energy commodities on the financial markets, a deregulated energy supplier offering a green alternatives to buying from local utilities and a trivia game manufacturer — before returning to school. While earning a master’s degree in supply chain management from Massachusetts Institute of Technology (MIT), Siegert was introduced to Tod Hynes, a lecturer at MIT’s Sloan School of Management, who’d developed several wind energy projects. The pair hit it off and decided to collaborate on a new venture, though at the time, they weren’t exactly sure what.
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“Tod was looking for what was next in his career, and we both had an interest in clean technology and clean energy,” Siegert recalls. “Just looking at all the different industries, we kept thinking about all the millions of vehicles on the roads. We crystallized the idea that if you come up with a fuel-efficient technology that’s cost-effective, you could have a big impact on the amount of petroleum and gasoline used in North America and, eventually, globally.”
Because the big automakers (Ford, General Motors, Chrysler) already had huge research and development departments with decades of experience improving fuel efficiency, consumer cars were out of the question. Commercial fleets, on the other hand, were a largely untapped market.
XL Hybrids inked their first major deal with Coca-Cola, the world’s largest beverage company. Though Siegert was ecstatic a big brand signed on, he was also nervous about translating an idea that looked good “on whiteboards, spreadsheets and technical designs” into a reality. “Now you’ve gotta go out and deliver the results,” he thought. Luckily, the company did. Retrofits of 175 Coca-Cola vans hit the roads last year, cutting fuel usage by 20 percent, saving 6,000 metric tons of carbon dioxide and at least $15,000 over each vehicle’s 10-year lifespan.
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Coke is buying more, including 70 this year. XL Hybrids has since brought on PepsiCo, FedEx and the City of Boston as customers. Last October, all the vehicles it had retrofitted reached a collective 4 million miles in service. Already, that means the company saved 800 barrels of oil and over 350 metric tons of carbon dioxide exhaust.
Today, Siegert is tasked with brokering those sales and overseeing daily production. In addition to the official titles printed on his business card, his colleagues know him to be a “strategic planner,” a “supply chain optimizer” and a “sales accelerator.” Above all, he prizes efficiency and affordability. That’s why XL Hybrids skips adding any fancy frills during its retrofits; the company’s technology is available for under $10,000 without government subsidies — a first. “We remove costs wherever we can,” he says. “One of the core tenets of our business, for whatever product [Tod and I] came up with, was that we wanted it to be cost-effective and have a good payback.”
While that sounds like pretty standard business advice, it’s missing from a large swath of the clean energy sector, where customers are expected to pay a premium to get something green. At XL Hybrids, Siegert wants to prove that sustainability and profit can be two sides of the same coin. He’s splicing corporate interests and ecological concerns, in a word, into a hybrid. After all, when it comes to miles per gallon, what’s good for the environment is also good for investors.
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Going to the DMV Just Got a Whole Lot Better

Rather than waste a day waiting in line, a person in Michigan, Texas, Massachusetts and a growing number of other states can check in at the Department of Motor Vehicles remotely via computer or cell phone or through an in-office kiosk. The app, which was created by Pasadena, Calif., tech firm QLess, will estimate the time until your number is called and send you a message when you’re up next. Running late? Send a quick text and you’ll be moved back in the queue.
“We believe time matters, and we’re on a mission to eliminate waiting lines worldwide,” says Alex Bäcker, QLess founder and CEO. “Our technology has liberated more than 20 million people from waits long and short, collectively giving humankind more than 500 years back, while simultaneously giving control back to an organization.”
Already a success for retail stores, healthcare facilities, college campuses and polling places, implementing QLess at DMVs was a logical next step. QLess reports a 75 percent reduction in people who walk away because lines look too long. For probably the first time ever, DMV customers are saying visits are actually “pleasant.”
“My wait was so short that I only lost two of my five lives on Candy Crush,” Darren Little notes of his review of Michigan’s program in The Detroit News. “We shouldn’t expect government to develop the latest and greatest technology,” he adds, “but we should expect them to utilize existing technology to make government work better.”
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The Top 5: America’s Best New Buildings

Undoubtedly, we associate cities with their iconic structures: New York City’s Empire State Building, San Francisco’s Golden Gate Bridge and the Gateway Arch in St. Louis, to name a few. But these edifices — so forward-thinking for their time that we’re still in awe of them today — are at least half a century old, making it seem like the era of erecting statement-making civic structures has passed.
Proving that designers are still as innovative as ever, however, are this year’s recipients of the prestigious Honor Award from the American Institute of Architects (AIA). The winners, which will be formally recognized at AIA’s National Convention in Atlanta this May, are diverse “in scale, expense, concept, use, in virtually every aspect,” says Waller McGuire, executive director of St. Louis Public Library and the only non-architect on AIA’s nine-member jury. “The strongest connection between the award winners is that we looked for architecture that respects and elevates the people using it: the people who will ultimately judge it for themselves.”
With that in mind, here’s a selection of five outstanding buildings, all of whose architects paid particular attention to their social responsibilities, impact and energy usage.
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How A Venezuelan Program Inspired Massachusetts to Save the Music

Across the country school budget cuts have led to diminishing music programs, but Massachusetts is borrowing an idea from Venezuela to carry on the tune.
The Massachusetts Cultural Council (MCC) announced plans this week to set aside funding for a program inspired by El Sistema, a free, music-education program founded in Venezuela, making it the first state to do so in the United States. The new program, SerHacer, translates to “to be is to make.”
El Sistema, which focuses on “intensive ensemble participation” from as early as pre-school, was founded in 1975 by Dr. Jose Antonio Abreu to help poor Venezuelan children learn to play music, according to its website. More than three decades later, the program has transformed into a philosophy that’s gaining international traction. In 2009, Dr. Abreu was awarded the TED Prize for his mission to expand the program. Venezuela’s El Sistema reaches more than 500,000 students with plans to increase that number to 1,000,000 annually.
MCC Executive Director Anita Walker began supporting the idea after a visit to Venezuela with the New England Conservatory and Longy School of Music, two higher-education programs that practice the philosophy. The Council plans to award $55,000 toward the initiative, according to Erik Holmgren, who is leading up SerHacer.
The first batch of recipients in Massachusetts include programs such as Sistema Somerville, the Cape Conservatory in Hyannis and the social service Kids 4 Harmony, according to WBUR. The state plans to open free instrument lending libraries to students while also conducting studies on the benefits of music education.
For schools like Springfield High School of Science and Technology, the benefits are obvious. Music director Gary Bernice tells WBUR 99 percent of his 500 students, most of which hail from low-income neighborhoods, had no experience with instruments before joining band.
“It’s no secret that our dropout rate and graduation rate in urban centers is not great. But for students who are in our band…for more than one year, they are almost twice as likely to graduate high school than their peers,” he says.
MORE: Music and Mentorship: How an Austin Org Is Helping Foster Kids Survive the System

This Desert Storm Veteran Is Recruiting 5,000 Comrades to Be MVPs

After graduating from West Point, Mike Minogue served in the military during the Gulf War. He then made a successful transition into the civilian world, now serving as the chairman and chief executive of Abiomed, a Danvers, Massachusetts-based company that manufactures what it calls “the world’s smallest heart pump” — but his fellow veterans are never far from his mind.
According to Shirley Leung of the Boston Globe, he’s on a mission to recruit 5,000 veterans into the field of life sciences by 2018.
Minogue isn’t just hoping veterans will join his industry on their own; he’s helped organize the MedTech and BioTech Veterans Program (MVP), which leads life science boot camps for veterans across the country, lines up corporate sponsors and connects former service members to mentors in the field. Minogue thinks veterans are especially qualified to work in the field because, “This industry is very mission focused,” he tells Leung. “It’s a mission to help patients. It’s global, it’s intense. There is a service element to it.”
The people at Massachusetts Life Sciences Center, an organization that oversees a 10-year, $1 billon-state funded investment in life sciences, think Minogue has a bright idea. Which is why they gave MVP a $50,000 grant to get started and another $50,000 to help them reach 1,000 veterans with the program.
Susan Windham-Bannister, president of the Massachusetts Life Sciences Center, tells Leung that MVP, “really creates pathways into the life sciences. We really saw this an opportunity to promote access and address a supply and demand issue.”
MORE: The Innovative Combat Medic Who Has Developed a Life-Saving Device for the Battlefield

How Price Tags in Hospitals Can Help Patients Avoid Huge Medical Bills

The Affordable Healthcare Act created marketplaces to expand affordable healthcare and to underscore that promise, Massachusetts is now requiring private health insurance companies to use price tags on anything from an MRI to a general check-up.
Beginning Oct. 1, all heath insurers in the Bay State are required to list prices in real-time, outlining the otherwise hidden costs of healthcare, much like an online shopping site. While it’s unclear if every insurer met the deadline, there is no penalty if they failed to do so, according to 90.9 WBUR
By using an online calculator on their insurer’s website, users can find out how much they’ve spent this year toward their deductible. If coverage does not include a deductible, the calculator will add up the balance toward the out-of-pocket maximum. Blue Cross customers can find the calculator under “Find a Doctor,” Tufts is under Empower Me” and Harvard Pilgrim’s is under “Now iKnow.”
While the mandate underscores a sea change in health care practices, Massachusetts first began the process two years ago when the state passed a law to increase transparency among hospitals and health insurers.

“This is a very big deal,” says Undersecretary for Consumer Affairs and Business Regulation Barbara Anthony. “Let the light shine in on health care prices.”

But the new law has its flaws, and though it’s still early, WBUR points out a few glaring issues with the new health care price tags.

No standard price: There is no standard price and no list of priced tests and procedures. Pricing out a visit depends on the insurer and can range in price drastically. For instance, an MRI for the upper back can cost between $614 and $1,800 on the Harvard Pilgrim “Now I Know” tool. The prices are also listed in real-time, which means they can change day-to-day.

Prices are ambiguous: Since insurers negotiate their rates with hospitals and physicians, they may entail hidden costs. For example, a listed price tag may not include the cost of reading a test or a facility fee.

Prices focus on outpatient care: The information is not comprehensive and encompasses few prices outlining what it would cost for inpatient care or an overnight stay at the hospital.

However, as Tufts Health Plan Director of Commercial Product Strategy Athelstan Bellerand notes, the new prices “are a major step in the right direction.”
By adding price tags, state officials are forcing us to think more about our health spending and how much a procedure actually costs, rather than leaving it to our private insurance. Anthony is also hoping by illuminating the price difference, more physicians will become sensitive to where they fall on the scale and ultimately encourage more competition and drive down costs.
“I’m just talking about sensible rational pricing, which health prices are anything but,” she adds.
MORE: The Checklist That Can Reform Healthcare

For Veterans Transitioning Off the Streets, This Organization Helps Them Feel Right at Home

Thanks to federal funds, nonprofits and government organizations across the country are making it their mission to get homeless veterans off the streets.
But while Veterans Affairs Supportive Housing provides rent payment assistance to formerly homeless vets, there aren’t as many programs giving them the resources to turn an empty apartment into a home. So that’s where Homeward Vets of Ludlow, Mass. steps in.
Ludlow’s Director of Veteran Affairs, Eric Segundo, tells Kaitlin Goslee of WWLP, “What they lack is what we do once we’ve got them the housing, not having the furniture, not having the items.”
The nonprofit collects donations of furniture, small appliances, and other useful home furnishing items from colleges, businesses, hotels and individuals. It stores them in its warehouse and then delivers them to veterans’ new homes.
Since March 2012, Homeward Vets has furnished the apartments of 274 former service members.
Navy Veteran David Felty, who founded Homeward Vets, believes a cozy, furnished apartment can make all the difference in enabling soldiers who are chronically homeless to turn their lives around and keep their apartments. “You can see it in their eyes, you can see it months down the road, they’ll call me they’ll check in. We have people that want to pay it forward and give back,” Felty says.
MORE: The National Movement to End Veteran Homelessness Continues in These Two Cities
 

When Taxpayer Dollars Aren’t Enough, Private Businesses Step in to Fund Public Programs

Taxes. It seems like we’re always grumbling about them — whether it’s the amount of sales tax we’re charged on a purchase or the total deducted from our paycheck. And regardless of the type, no one usually agrees on who should pay the most in order to bankroll all of the necessary programs funded by taxes.
Well, that’s why several states have developed a slightly different approach. Instead of using tax payer dollars to fund some public programs, they’re turning to the private sector.
It’s called “pay for success” and operates under the theory that if a program is a hit, investors won’t mind putting money into it.
To start, a state’s government outlines specific goals in a target area such as mental illness, homelessness or preventative health care. Next, private investors and philanthropic organizations finance nonprofits that provide cost-effective social services in that target area. Then, if the program meets the established goals, the investors will receive a “success payment.”  Not a bad deal, right?
As of right now, three states — New York, Utah and Massachusetts — and New York City have implemented such social impact bond (SIB) programs.
New York City was the first, establishing their Adolescent Behavioral Learning Experience (ABLE) program to reduce recidivism among 3,400 adolescents from Riker’s Island each year during a four year time period, according to the New York Times. The program was funded by Goldman Sachs. According to a press release, “Goldman Sachs receives its capital back only if the re-admission rate – measured by total jail days avoided – is reduced by 10 percent or more. Should the reduction exceed 11 percent, Goldman Sachs will also receive a financial return that is consistent with typical community development lending.”
The program in Massachusetts is targeting recidivism rates and employment outcomes among at-risk youth. There’s also a program for adult basic education in development.
Even the federal government is throwing its hat into the ring. The Obama administration funded a model project in Ohio as well as promised $500 million to help other states and local governments start programs.
And now, all eyes are on these programs whose success could mean a complete revamping in how governments operate. Fewer taxes and more public projects — now that’s a plan that most of us could get behind.
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