The Senate Committee on Finance held a hearing to examine the role of outcomes and evidence-based standards in informing social policies and to explore how to apply them more effectively to program delivery and financing models.
Specifically, senators discussed moving towards evidence-based models like social impact financing and “pay for success,” which drive government resources toward high-performing social welfare programs.
Under these models, private investors provide capital to a particular social program and receive a reimbursement and financial return from the government if the program achieves predetermined outcomes.
“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 federal programs, taxpayers are on the hook for set costs of processes and/or reimbursements with little or no regard for effectiveness.”
Ranking Member Ron Wyden (D-OR) welcomed the opportunity to discuss evidence-based standards but said that the lawmakers should proceed with caution.
‘[T]here 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 a bigger scale can also be expensive. They often rely on a highly educated and trained workforce. So progress can be slow. Finally, reasonable people can differ on what it really means for a program to be successful using a variety of measures.”