How to Develop a SIB in Health: 3 lessons from our learning event

How do we improve the health of individuals, in a way that prevents health issues arising in the first place or getting worse? And how can Social Impact Bonds (SIBs) be developed in health and other areas where the benefits are longer term, with less immediate results and savings to the public purse?

These questions were at the heart of an event held last Friday (10 July) in Birmingham.  It brought together a range of stakeholders with a strong interest in improving the nation’s health, especially through the use of SIBs.

The event was hosted by the Big Lottery Fund, whose Commissioning Better Outcomes (CBO) Fund looks set to play a major role in encouraging more SIBs in the next few years. It was held to discuss a new SIB which breaks new ground in health and has just been examined in depth as part of the evaluation of the CBO Fund done by Ecorys and ATQ.

SIBs have grown steadily in the last five years, and the new Conservative government has committed to further and faster growth during this Parliament. But it is fair to say that they have been focused in areas where there is relatively early payback to the commissioner (such as when they fund diverting children from expensive residential care) or have been funded by central government (such as the recent Fair Chance and Youth Engagement Funds, which will create 11 new SIBs to tackle homeless and youth unemployment and disengagement).

What many want to see is more SIBs that are locally commissioned by agencies that have grasped how they can help them try out new approaches and demonstrate the benefits of early and preventative intervention in complex areas. One such area is Health, where ever rising costs and demand make innovation, and shifting resources to prevention, a major challenge.

The Birmingham event focused on a new SIB which aims to tackle these issues head on. Ways to Wellness aims to improve outcomes for 8,500 patients in Newcastle with Long-Term Conditions (LTCs) such as diabetes. The local Newcastle Gateshead Clinical Commissioning Group (CCG) will pay up to £8.2m if the SIB helps patients improve their self-management of LTCs and ultimately reduces costs through fewer hospital admissions.

Ways to Wellness is the first SIB to tackle physical health issues directly and the first to receive substantial funding from the CBO Fund. The Birmingham event brought together the main parties to the SIB who have just been involved in the first “Deep Dive” of a CBO-funded SIB, the report on which is published today. In total, the CBO evaluation will be producing 10 ‘Deep Dives’ – in-depth reviews of 10 SIBs, following them from their design through to completion.

The Ways to Wellness SIB

The attendees at Friday’s event (people involved in developing other SIBs in health) heard from all three main parties to the SIB: Ways to Wellness (the prime social contactor and umbrella provider); Newcastle Gateshead CCG (the commissioner); and Bridges Ventures (the investor). They talked about a number of issues which are covered in depth in the Deep Dive report, but it is worth highlighting three common themes that came out strongly from all the presentations.

1. There needs to be the right level of engagement between the parties.

Philip Angier, from Ways to Wellness, spoke about the need for early buy-in from the commissioner at a senior level. For the commissioner, Philippa Dodds concluded that getting everyone into the same room at the start was critical. Mila Lukic, from Bridges Ventures, highlighted the importance of them being brought in at an early stage and emphasised the importance of a strong Board on which all the parties are represented.

2. All parties must understand the risks they are taking on and share them appropriately

As Philip put it, “potentially everyone has something to lose, but shouldn’t lose everything”. This is because the contractual structure has been well thought through, and everyone is bearing a fair proportion of the total risk

3. Developing a SIB requires perseverance to overcome challenges

Both Philip and Philippa talked about the need to be patient in dealing with issues such as the NHS standard contract and Information Governance procedures – neither of which are a good fit with innovative SIBs. The SIB took around four years from initial idea to live contract, and 18 months from the start of detailed design.

The discussion which followed was interesting since it showed how hungry the audience was for detailed information from which they could learn. Most of the questions were technical, and touched on such issues as the development of the detailed outcome metrics, the design of the Ways to Wellness company and its governance structure; and the way data is being used to manage operational performance. We take some comfort from this that the Deep Dive process – which explains how these issues were tackled in detail – will be useful to others who are taking up the SIB development challenge.

You can read the speakers’ presentations at the following links: Ways to Wellness, Newcastle Gateshead CCG and Bridges Ventures.