Key to Success in Pay for Success: Data, Data, Data

The following blog post was written by America Forward Government Affairs Director Nicole Truhe.

Last year, a federal commission began studying how data that the government already collect can be used to improve government programs and policies. The Commission on Evidence-Based Policymaking was the creation of Speaker Paul Ryan (R-WI) and Senator Patty Murray (D-WA), who are long-time champions of data and the use of evidence to drive federal policymaking. After over a year of meetings and deliberations, the 15-member Commission wrapped up its work with a final report and list of recommendations focused on data access, privacy, and capacity.

This Commission articulated what many in the Pay for Success (PFS) community have been uncovering through their feasibility study and project construction support work for years now. Data are at the center of our ability to generate evidence, assess programs for impact, and ultimately make decisions about what to fund and at what level with our limited resources.

Since 2014, Third Sector Capital Partners Inc. (Third Sector) has been working with government jurisdictions and nonprofit providers to provide PFS technical assistance and feasibility assessment support through its Social Innovation Fund Pay for Success (SIF PFS) grant. In that time, Third Sector launched three competitions and selected 14 sub-recipients to receive support. Data is an almost universal point of discussion in this work. Many of the same data-related challenges and opportunities exist across sub-recipients and closely align with the data issues surfaced in the Commission’s final report.

Across Third Sector’s SIF PFS sub-recipients, there is agreement that linking and integrating datasets, accessing administrative data, building data infrastructure and technical capacity, establishing a data culture that includes building trust to engage in data sharing agreements, and resourcing data analysis activities are all critical elements for governments and providers interested in using data to make decisions. For most sub-recipients in the first two cohorts, focused on early childhood and youth workforce interventions respectively, there were gaps in these areas, which limited their ability to assess social and human services programs and their long-term outcomes.

Gaps in data infrastructure impact the ability of governments to fully examine service utilization and costs. Lack of integrated data systems and technical capacity limit government and provider staff from being able to measure outcomes of interest or support improvement processes of programs and services. And not being able to access certain administrative datasets makes it difficult to set outcome baselines, thus impeding the ability to enter into PFS contracts.

Two specific examples from Third Sector’s SIF PFS work clearly showcase the importance of data and the significance of being about to access, integrate, and analyze data for the achievement of government and provider goals, including the provision of effective and efficient services.


State of Nevada

The State of Nevada, in partnership with Clark County and the City of Las Vegas, received support from Third Sector to explore the use of PFS in improving social outcomes in early childhood education. In the course of their work with the State, Third Sector realized that there was not a full understanding of the early childhood education funding landscape—both how the state was using its own resources and how it compared to the rest of the country—which was important for the State to understand as they evaluated various funding mechanisms and how best to improve their Pre-K services.

As a result, Third Sector helped to conduct analyses that provided data that was not readily accessible by the State. One analysis provided information on the challenges and opportunities triggered by a significant decrease in federal funding for early childhood education in Nevada. Third Sector collected benchmarks and conducted analysis of education funding mechanisms operating within the State and across the US as well as a review of legislative and funding proposals for expansion of early childhood education from various states.

The analysis uncovered important data points about Nevada’s Pre-K funding gap, if early childhood education resources remained steady. It also highlighted that the State of Nevada’s Pre-K spending is falling behind the national average state spending per pupil. By looking at other states’ funding formulas, Third Sector provided suggestions that could assist the State in increasing the availability, quality, and access of early childhood education.


Friends of the Children

Friends of the Children is a Portland, Oregon-based international nonprofit organization with a model for helping high-risk children avoid negative behaviors and life outcomes. Their research-based, evidence-informed, and replicable paid professional mentoring model is well suited for expansion and there is a need in the State of Oregon for such an intervention in the child welfare and juvenile justice systems. Third Sector worked with the organization to explore the scaling of their model within the State and to build their organizational infrastructure to deliver outcomes government is willing to pay for.

In its PFS feasibility assessment work with Friends of the Children, Third Sector helped secure access to an integrated dataset for the organization to begin to develop an Oregon-centric evidence base. The integrated database brought together outcomes related to child welfare, education, and self-sufficiency for children in foster care in specific counties in the State. With access now to this integrated data set, the organization can (i) improve service delivery, (ii) develop its own evidence base for education, foster care, and juvenile justice outcomes, and (iii) serve as the cost basis for negotiating performance benchmarks and contract pricing.


These examples showcase the importance of administrative data access, data infrastructure and technical capacity, integrated datasets, and data analysis resources and the impact those features can have on important strategic decisions. They are just some of the examples that Third Sector, and many other PFS support organizations, have surfaced from their work studying and supporting the integration of PFS into state and local systems.

For Third Sector’s newest cohort of SIF sub-recipients, establishing data linkages through integrated data systems and outcomes-focused programming is a primary focus. The Empowering Families Initiative is a partnership between Third Sector and Actionable Intelligence for Social Policy (AISP) at the University of Pennsylvania to provide five government sub-recipients with the technical assistance to develop both Integrated Data Systems (IDS) and a flexible, scalable contracting model based on measurable outcomes. Through this work, Third Sector and AISP look to establish performance feedback loops where government and providers have access to linked administrative data systems to make informed decisions to improve programming on an ongoing basis.

As the Commission on Evidence-Based Policymaking recognized, data are important building blocks for the generation of evidence and many of the greatest gains for evidence building can be achieved by addressing the challenges that surround data access, capacity, and privacy. The support provided by the SIF PFS program is critical to surface data challenges, assess ways to address these challenges, and ultimately achieve the promise of the evidence-based movement to measurably improve the lives of individuals through more effective services.


About the Social Innovation FundThe Social Innovation Fund (SIF) was a program of the Corporation for National and Community Service (CNCS) that received funding from 2010 to 2016. Using public and private resources to find and grow community-based nonprofits with evidence of results, SIF intermediaries received funding to award subgrants that focus on overcoming challenges in economic opportunity, healthy futures, and youth development. Although CNCS made its last SIF intermediary awards in fiscal year 2016, SIF intermediaries will continue to administer their subgrant programs until their federal funding is exhausted.

The Corporation for National and Community Service is the federal agency for volunteering, service, and civic engagement. The agency engages millions of Americans in citizen service through its AmeriCorps, Senior Corps, and Volunteer Generation Fund programs, and leads the nation’s volunteering and service efforts. For more information, visit

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