This Toolkit provides a framework for understanding the practices necessary to move state and local government agencies and human services providers from compliance-focused to outcomes-focused contracting. The Toolkit provides five detailed recommendations to accomplish this shift, including links to specific tools and templates for interested governments as well as examples of leading practices in states, cities, and counties that have successfully implemented these recommendations.
Taken together, the recommendations, tools, and leading practices identified in this Toolkit can help bring about significant change in human services contracting. When state and local governments and human services providers work together to implement accessible, collaborative, and outcomes-focused contracting, they can enhance positive results and better serve the young people, families, and communities who depend on them to provide the services they need to reach their fullest potential.
Government agencies should engage human services providers, service recipients, and community groups to gather feedback, define desired results, and establish outcome goals for each key contract.
1. Identify key contracts. Government should identify their most important human services contracts that either are approaching a renewal period or relate to priority government goals.
2. Collaborate and focus on outcomes. Government agencies should engage with human services providers, service recipients, and community groups prior to the issuance of a request for proposal (RFP) for services. Using a pre-proposal conference with providers, letters of interest, or requests for information, government agencies can validate community needs, align expectations and collaboratively develop outcomes.
3. Provide oversight. Government agencies should dedicate a person or team to strategically manage a portfolio of the most important procurements across the government for the upcoming year.
State and local government agencies play a central role in providing human services to residents. Before issuing an RFP, policymakers should engage providers and community members to clearly understand community needs and define the outcome goals for each key procurement. An upcoming contract can be an opportunity to revisit goals and align resources. By engaging human services providers, service recipients, residents, other community organizations, subject matter experts, and funders, state and local governments can use the procurement cycle to validate the community need, align expectations, and develop shared outcome goals. In sum, a true focus on outcomes requires that government leaders and human services providers treat each other as valued partners for achieving common goals of improved outcomes for their residents and clients.
King County implemented the Best Starts for Kids initiative to create a comprehensive approach to early childhood development, which included a $65 million voter-approved investment. With the implementation of this investment, King County focused on making their new contracting process more accessible to community providers, as well as more collaborative and outcomes-focused (Results for America, 2018, Case Study). The County’s contracting process begins by engaging with community members and local community-based organizations to jointly develop shared goals and values. County program managers have flexibility to make decisions about contracts, manage contract negotiation, and provide contract oversight. Each contract has performance measures which are developed in partnership during the contract negotiation process. County program managers and providers work together to address provider challenges and make program improvements to achieve the desired performance measures.
New York City
New York City has a variety of resources to help create a more collaborative and effective relationship between government and human services providers. The New York City Nonprofit Resiliency Committee, comprised of city staff and providers, coalitions, academia, and philanthropies, is charged with identifying, designing, and launching solutions to increase collaboration between New York City and nonprofit human services sector. The Committee released tools including a Guide to Collaborative Communication with Human Services Providers and a Civic Service Design guide to improve the outcomes of government programs and contracting. Examples of agency implementation include:
- New York City Administration for Children’s Services (ACS), Division of Prevention Services Communities of Practice (CoP) has made communication with contracted nonprofit service partners a key part of their contracting and service delivery process. The CoP uses channels of communication that are easy and convenient for providers to access to collect program-related feedback in real time and to ensure nonprofits and key stakeholders have a voice in decision making.
- New York City Mayor’s Office of Immigrant Affairs (MOIA) solicited targeted community feedback by sending a survey to a pre-qualified list of vendors as well as posting the survey to their website and sharing with a community committee. By developing a survey that asked specific questions about their service concept, they were able to solicit highly specific feedback that could be easily incorporated into the RFP draft. They found the survey lowered the barriers for providing feedback by making it a clear, straightforward process. With this more user-friendly strategy, MOIA received input from over 40 New York City nonprofits and advocacy groups.
Washington, D.C.’s Procurement Practices Reform Act of 2010 requires each city government contract to include performance standards and expected outcomes of the proposed contract.
Tools and Templates from the Field:
- The New York City Nonprofit Resiliency Committee developed a Guide to Collaborative Communication with Human Services Providers to help agencies understand their various options for communicating with key stakeholders while complying with the contracting rules.
- The Government Performance Lab at the Harvard Kennedy School has developed a portal with a collection of useful, publicly available government documents, including several sample requests for information (RFIs).
Government agencies should allow for funding flexibility to permit human services providers to align programs and focus on holistic outcomes for the target populations.
1. Review funding streams. Government agencies should proactively review which and how many resources to dedicate to each government procurement in order to accomplish its stated objectives and outcomes.
2. Blend funds. When appropriate, government agencies should bring multiple funding sources together into one solicitation, which allows providers to focus on outcome-oriented services rather than recordkeeping for disparate grants. By examining a wide range of potential funding sources and combining funding from separate government programs and budgets, governments no longer limit funding for human services to any one government program or agency and can align disparate funding sources toward accomplishing shared outcomes.
3. Streamline allowable uses. Currently, most government funding streams have their own restrictions on allowable uses of funds. When feasible, government agencies should streamline allowable uses across each contract to minimize the administrative compliance burden on human services providers and for ease of government oversight.
4. Focus on the long term. Government agencies should provide incentives for multiyear contracts that enable a focus on sustainable, long-term change.
Government contracts that focus on outcomes align all stakeholders toward achieving results for the client. However, program-specific fiscal restrictions often make it difficult for government to provide funding that is focused on achieving holistic outcomes. Breaking down these silos aligns program and funding streams, increasing results for target populations. Thus when government agencies can provide funding flexibility by combining funds from multiple funding sources and streamlining allowable uses, they reduce compliance technicalities for providers and allow more resources to be devoted towards achieving long-term outcomes at scale.
Bernalillo County, New Mexico
Bernalillo County, New Mexico, with pro bono technical assistance from the Government Performance Lab at the Harvard Kennedy School, reformed its procurement practices to ensure that the right services are reaching the right people. In response to growing community concern about ineffective behavioral health care services, the voters of Bernalillo County and the County Commission approved an additional $17 million per year for the County to spend on providing high-risk populations with targeted behavioral health services. To ensure funds were used effectively and not siloed in agencies, and to meet the intended outcomes, a joint city and county governing structure was developed. It included subcommittees that were each staffed by a city or county employee and were also chaired by and made up of community members. Bernalillo County issued a new problem-based request for proposal (RFP) and used the new contracting process as an opportunity to transform its service delivery system to focus on collaboration, behavioral health best-practices, real-time data sharing, evaluation, and program improvement. This procurement approach is now being adopted more broadly throughout the county government (Harvard Kennedy School Government Performance Lab, Project Feature, 2017b).
San Francisco, Office of Economic and Workforce Development (OEWD)
San Francisco, Office of Economic and Workforce Development (OEWD), with support from the Government Performance Lab at the Harvard Kennedy School through Bloomberg Philanthropies' What Works Cities initiative, worked to both better align services, funding, and contracting across departments and incorporate performance-based payments. Recommendations for improving system alignment included conducting joint procurements, reducing service overlaps and gaps to make sure that the array of services corresponds to the needs of the population, and coordinating outreach to participants to match them to appropriate programs regardless of departmental entry point (Harvard Kennedy School Government Performance Lab, Solutions Book, 2018b, p. 5).
Seattle Department of Human Services
Seattle Department of Human Services, with support from the Government Performance Lab at the Harvard Kennedy School through Bloomberg Philanthropies' What Works Cities initiative, consolidated and streamlined homeless services contracts. By merging 26 disparate contracts into eight portfolio contracts, Seattle was able to increase flexibility for their five human services providers allowing them shift funding between their programs as needed. This streamlining facilitated the city's move toward a performance tracking system to consistently measure outcomes across similar programs. By establishing baselines and introducing performance targets, Seattle improved collaboration so that city and provider staff can identify challenges to service provision in real-time and implement solutions to drive better performance and ultimately outcomes (Harvard Kennedy School Government Performance Lab, Solutions Book, 2018b, p. 5).
Tools and Templates from the Field:
- Performance Partnership Pilots (P3) is a federal initiative designed to help improve outcomes for disconnected youth by giving state, local, and tribal jurisdictions additional flexibility in using and blending existing discretionary funds across multiple federal programs. In Fiscal Years 2014-2016, this flexibility was granted to ten high-performing jurisdictions per year with the expectation that pilot sites achieve a set of cross-agency, data-driven outcomes and build the evidence base about what works for vulnerable youth.
Issue Clear Requests for Proposals that Focus on Outcomes and Preference Evidence
Government agencies should issue requests for proposals (RFPs) with clear outcomes and measures that meet validated community needs and preference evidence-based solutions.
1. Use outcome-focused RFPs. Government agencies should incorporate outcome goals into their RFPs. These outcome goals should reflect feedback from human services providers, service recipients, and community groups gathered during the pre-proposal feedback phase.
2. Preference evidence. Government agencies should define the evidence requirements that human services providers need to include in their proposals. As part of the RFP scoring system, government agencies should award points for the use of evidence-based interventions.
3. Promote a more accessible process. Government agencies can improve efficiency by using simple RFP language, creating a central repository for RFPs, and establishing consistent RFP timelines.
Rather than mandating specific process steps, government agencies should insist that service providers focus on achieving outcomes. As government agencies move away from short-term output measures, they should require the use of evidence-based models. When government agencies allow human services providers more latitude to achieve outcomes, they must have assurances that providers’ program models have a high likelihood of succeeding . In combination with regular performance monitoring (discussed in recommendation #5), implementing programs with evidence of effectiveness, such as those found in evidence-based clearinghouses, is the best way for government agencies to increase the likelihood that interventions will achieve the desired outcomes.
Government agencies should also incentivize providers to build more evidence about what works and to use data to improve their models. As a starting place for this approach, the RFP should contain a clear definition of what “evidence-based” means. This definition should allow providers to use evidence-informed promising practices with the condition that these practices receive ongoing evaluation. One strategy used at the federal level is to implement tiered evidence systems that award points to applicants along an evidence continuum from promising to proven practices.
To achieve the best results, both nonprofits and governments should commit themselves to a culture of learning in order to improve the effectiveness of human services programs. Finally, developing consistent RFP language, processes, and timelines provides greater consistency and efficiency for both government and human services providers.
The Florida Department of Juvenile Justice
The Florida Department of Juvenile Justice requires the use of evidence in the RFP process (Pew-MacArthur Results First Initiative, 2016, p. 4). The Office of Program Accountability monitors contracted providers using real-time data uploaded to its Juvenile Justice Information System, which shows whether a program is being implemented with fidelity to its model. The Department also provides technical assistance to providers to support training on evidence-based program models.
New York City Mayor’s Office of Contract Services
New York City Mayor’s Office of Contract Services has created a variety of standardized materials to improve its human services contracting and payment process, including a standardized audit guide, a streamlined claims verification process, and a payment advance policy that allows a provider to request an advance of 25% of its annual budget. New York City’s Procurement and Sourcing Solutions System (PASSport) provides a central access point for submitting contracting documents, improving the efficiency and consistency of the contracting process.
The Santa Cruz Probation Department
The Santa Cruz Probation Department requires 100% of providers receiving grant funding to offer evidence-based programming (Pew-MacArthur Results First Initiative, 2016, p. 7). The Results First report highlights how the Department works with service providers to develop a common set of outcome measures, which are tracked and reported quarterly. The report highlights the how the Department collects data for program evaluations and monitors implementation to ensure fidelity.
Tools and Templates from the Field:
- Results for America’s 9 Ways to Make Federal Legislation Evidence-Based: 2017 What Works Guide for Congress describes various definitions of “evidence-based” and provides examples of how these definitions can be applied . Simply including the word “evidence-based” in RFPs and contracts will not improve outcomes, since evidence can mean anything from an anecdote to the most rigorous randomized control trials. Defining “evidence-based” is the critical first step towards the effective implementation of proven program models .
- State and local governments can use the Results First Clearinghouse Database, a tool from The Pew Charitable Trusts and the John D. and Catherine T. MacArthur Foundation, to identify appropriate evidence-based interventions.
- The Government Performance Lab at the Harvard Kennedy School has developed a portal for a collection of useful, publicly available government documents, including several sample RFPs.
Government agencies should issue clear contracts that pay for outcomes, not outputs or process steps, while incentivizing providers to build and use evidence.
1. Use outcome measures in contracts. Government agencies should ensure that contracts include outcome measures that reflect the community-level goals identified in the request for proposals (RFP).
2. Tie payments to outcomes. Government agencies should connect payments to the achievement of measurable outcomes including exploring innovative contracting models (such as Pay for Success, outcome rate cards, and outcome bonus payments).
3. Include data use in contracts. Government contracts should include provisions for collecting, integrating, and sharing data across agencies and service providers.
4. Incentivize evidence building. Government agencies should incentivize funding what works by including funds for rigorous, independent evaluation of programs.
5. Use a consistent payment process. Government agencies should use consistent invoicing, payment systems, and standardized payment timelines to allow staff to focus on outcomes, not payment processing.
When government pays for outcomes – not outputs – they can measurably improve the lives of people most in need by shifting dollars toward better, more effective programs. Governments can achieve this goal through outcomes-based contracts that tie a portion of the payment to measuring and achieving outcomes rather than inputs or outputs. These contracts may contain bonus payments for the achievement of specific intermediate process and long-term outcome goals. Outcomes-focused contracts provide a clear framework for monitoring progress and ensuring the program achieves its intended result.
Two other innovative models of outcomes-based contracting that governments should explore are Pay for Success financing and outcome rate cards. Pay for Success is a public-private partnership in which investors provide upfront capital to scale prevention-focused social interventions and government repays the upfront capital in addition to a modest return, only if the intervention produces identified impact. Outcomes rate cards provide a menu of outcomes that government seeks to achieve at the prices they are willing to pay. While moving to 100% outcomes-based payments may not be advisable for most government contracts, moving towards more outcomes-focused contracting models enable governments to provide more effective and evidence-based programs to residents.
These outcomes-focused contracts should have mechanisms (such as setting aside funds for data collection, evaluation, and provider capacity building) to continually grow the evidence-base and allow for innovation. Without this kind of ongoing data collection and evaluation, policymakers lack basic information about the effectiveness of the programs they fund.
Government agencies should also create a consistent payment process for contracts. This payment process should utilize standardized systems and templates for invoicing and payment as a way to increase efficiency. Standardized payment processes reduce the administrative burden on staff and allow procurement officers to focus on ensuring that contracts are achieving their desired outcomes. Taken together, these efforts elevate the role of contract managers and procurement officers by providing them with consistent, user-friendly tools, which allows them to spend more time on active contract management and less time on invoice review, data processing, and other technical compliance tasks.
The Illinois Department of Children and Family Services
The Illinois Department of Children and Family Services uses a data-driven performance management approach to contracting (The Pew Charitable Trusts, 2018, p. 15). The Department incorporates specific performance goals into service contracts with private providers that specify both incentives and penalties based on outcomes.
King County is making their contracting process more collaborative, outcomes-focused, and accessible to community providers in conjunction with the implementation of the Best Starts for Kids Initiative (Results for America, 2018, Case Study). This redesigned contracting process promotes evidence-based preventive services, while simultaneously allowing the County to test innovative and community-based approaches. Best Starts for Kids recognizes that existing evidence-based and evidence-informed models do not work for all communities, and they place equal value on innovative, community-based programs, providing them with the support they need to evaluate their impact and build a base of evidence for new approaches.
The Pennsylvania Department of Corrections
The Pennsylvania Department of Corrections uses data in its contracting processes. Community corrections programs that serve recently paroled or soon-to-be paroled inmates must meet performance targets based on the recidivism rates of their clients (The Pew Charitable Trusts, 2018, p. 16). Agencies whose clients attain a better-than-expected recidivism rate earn an increase of 1% in the Department’s per diem rate (Chieppo, 2015). Agencies with recidivism rates that are worse than expected for two consecutive contracting periods may have their contract terminated. Department officials credit this system with an 11.3% reduction in recidivism rates for 2014 – 2015.
Tools and Templates from the Field:
- The Government Performance Lab at the Harvard Kennedy School has developed a portal for a collection of useful, publicly available government documents, including several sample contracts.
Government agencies should use frequent data gathering and regular communication with providers to monitor implementation, identify progress, provide timely feedback, and make necessary adjustments to ensure contracts meet their outcome goals.
1. Regularly monitor progress. Government agencies should establish clear procedures and mechanisms to monitor progress toward outcomes and make programmatic course corrections as necessary.
2. Implement data systems. Government agencies should set up integrated data systems to provide easy access to all relevant sources of information and data related to achieving outcomes.
3. Use data-sharing agreements. As part the contracting process government agencies should put into place data-sharing agreements to provide human services providers with access to relevant operational and outcome data.
4. Share performance data. Government leaders and human services providers should regularly exchange data to measure progress against goals, provide timely feedback, and make necessary adjustments.
Today, government agencies often view a finalized contract as the end of their work until the next renewal cycle. However, in an outcomes-focused world, the final contract is just the beginning of government’s work; consistent communication with and oversight of human services providers should be ongoing. Collaboration is key in designing programs, but it is also the best way to improve program implementation. Active contract management provides this coordination and closes the feedback loop, with governments soliciting and nonprofits providing frequent updates on program progress and interim goals.
A necessary component of this feedback loop is a centralized data system which gathers all the necessary program data. Building on this data system, government contracts should include provisions for ongoing information sharing, including (but not limited to) data-sharing agreements. These data-sharing agreements outline the provisions for collecting, sharing, and making decisions based on real-time data. This shared performance management can be accomplished through dashboards, regular meetings, and site visits. Feedback loops allow government and human services providers to make course corrections and program improvements. By comparing current and past performance, government agencies can power continuous learning, improve services, and meet desired outcomes. To make this process of actively managing contracts effective, governments must also work to create a culture of learning and a community of practice to support contract managers in executing this significant change.
Connecticut’s Department of Children and Families
Connecticut’s Department of Children and Families with pro bono technical assistance from the Government Performance Lab at the Harvard Kennedy School piloted improvements to the way the agency matches families to services (Harvard Kennedy School Government Performance Lab, Project Feature, 2018a). Among other innovative practices, the Department is using collaborative, data-driven conversations between the agency and providers to resolve problems with service delivery and identify opportunities for systems reengineering. This active contract management approach is being tested on intensive family preservation services across the state with the goal of expanding it to other service types.
Washington, D.C.’s Department of Employment Services (DOES)
Washington, D.C.’s Department of Employment Services (DOES), with support from the Government Performance Lab at the Harvard Kennedy School through Bloomberg Philanthropies’ What Works Cities initiative, employed results-driven contracting procedures to procure a new one-stop workforce development services provider and address the disproportionate employment rates across wards. (Harvard Kennedy School Government Performance Lab, Solutions Book, 2018b, p. 3). The goal was to better connect unemployed residents with jobs. The District defined specific objectives for the provider and invited vendors to explain how they were going to meet the identified goals and provide the outlined services. As a result, Washington, D.C. developed an RFP that defined key process and outcome metrics. This helped them assess the performance of the provider and the overall workforce development system. Having established an active contract management approach, Washington, D.C. contract administrators meet bimonthly with vendors to review performance indicators and flag any issues in real time. These meetings allow vendors and the District to brainstorm solutions together and foster a shared understanding of the program. To incentivize results rather than just compliance, Washington, D.C. plans to renew contracts with vendors based on performance reviews using a combination of process metrics, outcome metrics, and the vendor’s level of collaboration with the District.
Tools and Templates from the Field:
- The Government Performance Lab at the Harvard Kennedy Schools’ 2017 policy brief Active Contract Management: How Governments Can Collaborate More Effectively with Social Service Providers to Achieve Better Results, describes how active contract management has been applied in in New York City, Seattle, Rhode Island, and Illinois.
- In January 2018, Robert Doar and the Evidence-based Policymaking Collaborative developed the Data Access and Integration Toolkit to provide the background, definitions, strategies, and examples a policymaker would need to effectively integrate and provide access to administrative data.
- Actionable Intelligence for Social Policy is an initiative that focuses on the development, use, and innovation of integrated data systems (IDS) for policy analysis and program reform. Among the resources they provide are legal agreements and other supporting documents that can help facilitate the sharing of administrative data.
- In 2014, the Administration for Children and Families within the U.S. Department of Health and Human Services created a Confidentiality Toolkit designed to promote appropriate, confidential data sharing across human services agencies. The initiative has two goals: (1) to help state and local leaders provide more effective services, and (2) to provide greater clarity regarding the rules governing confidentiality.
- In 2016, a memorandum of understanding was signed between All Home, King County, and United Way of King County committing the agencies to aligning community priorities across the entire network and tying funding to outcomes that improve the effectiveness of the homeless system. The data sharing needed to facilitate this work was enabled by the Homelessness Partner Agency Privacy and Data Sharing Agreement. This agreement clarifies the rights and responsibilities of the parties regarding access to and use of Homeless Management Information System data by the partner agencies. Seattle consolidated and streamlined the data collection process by using one system, the federally mandated Homeless Management Information System and collaborated with providers to increase data collection accuracy. The Washington Homeless Client Management Information System Law made this effort possible.
- New York City created a simple form to accelerate internal data sharing.
State and local governments are in a position to meet the key social challenges of our time, including: income inequality, unemployment, homelessness, inadequate access to affordable housing, opioid abuse, and mass incarceration. While these are big challenges, if government agencies can make smarter use of public resources, they can scale solutions that work and make significant progress. Policymakers are increasingly turning to evidence-based solutions to get better results and lower costs.
The What Works Toolkit: A State and Local Government Policymaker’s Guide to Improving Human Services Contracting and Outcomes is designed to help state and local government agencies build on these trends to achieve better outcomes for residents by moving from compliance to outcomes-focused procurement.
To achieve these better outcomes, a cultural change is needed in the way that governments and human services providers interact. To that end, all five recommendations in this Toolkit are built on the idea that better results can be achieved when government and human services providers create a collaborative culture that is focused on achieving overarching outcomes through the use of evidence-based approaches. This work starts with government gathering feedback and collaboratively developing outcomes-focused goals (recommendation #1). When combined with a more holistic approach to contracting that breaks down government program and budget silos (recommendation #2), this collaboration can result in RFPs that are clear, evidence-based, and outcomes-focused (recommendation #3). Making sure this outcomes-focused approach is executed through contracts that build evidence (recommendation #4) and connected to feedback loops with strong performance monitoring systems (recommendation #5), creates a human services procurement system that is focused on delivering outcomes and continually improves to get better results. If implemented, these five recommendations can create a win-win situation for government and service providers and, most importantly, for the people they serve.
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