Social Finance, who is leading the UK’s first government-backed social impact bond in the area of re-offending, is investigating the potential for designing social impact bonds for the health sector.
In a webinar held by Social Finance last week, Ben Jupp, director at Social Finance said interest was growing in health-related social impact bonds (SIB), with improving care for patients with long-term conditions appearing to be a promising SIB focus.
A SIB is a contract with a public sector commissioner in which it commits to pay for improved social outcomes, such as reduced re-offending or improved health and well-being.
Jupp said that a SIB could raise funds to improve and create services designed to deliver better primary and community care. Public sector commissioners could repay investors on improved outcomes such as reducing all hospital admissions among a geographical population or improving the health of a specific population group, such as the elderly.
Social Finance has begun to investigate the potential in this field. Current projects include an assessment of whether there are cost savings and health improvements that could be made through improving care for some rare conditions, such as multiple sclerosis.
Eleanor Stringer, an associate at Social Finance said instead of paying for activity in preventative care, public sector commissioners could pay for the outcome of healthier patients, but she added:
“We have to explore whether healthier patients are real savings, and whether it is cashable in the UK. There are significant changes developing in the health commission landscape, therefore there is still a lot of uncertainty around this.”
Jupp also said there was investor appetite from trusts and foundations in the area, but some were worried about integrating with statutory funding, and possibly replacing it.
“This will be a challenge with SIBs in health,” he said. “A different class of investor such as pensions funds would be more comfortable with investing in the NHS and voluntary and community sector.”
