SOCIAL INVESTMENT IN HEALTH AND SOCIAL
CARE
27 FEBRUARY 2014
Richard Todd, Associate Director
richard.todd@socialfinance.org.uk
Social Finance is authorised and regulated by the Financial Conduct Authority FCA No: 497568
WHAT DO WE DO?
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Social Finance works with government, social ventures and investors to unlock
financial barriers and help drive social change.
Change the way government
seeks to tackle problems
We create financial
structures and implement
programmes that bring stable
and sustainable funding to
organisations dealing with
social issues
Help build and support
growth of strong, effective
social enterprises
Expand the range of investors
able to participate in social
investment
©Social Finance 2014
DELIVER SUSTAINABLE
AND SCALABLE SOCIAL
CHANGE
COULD SOCIAL INVESTMENT HELP TRANSFORM HEALTH AND
SOCIAL CARE?
Despite the scale of spending in these sectors, there remain areas where radical
improvement is needed yet traditional financial structures have been unable to
effectively meet this need.
Challenge
Potential value of social investment
Funding on the basis of historical
activity, not new opportunities
Flexibility to deploy capital unrestricted by
existing structures and outside of traditional
annual budget cycles
Investment in R&D and ‘mainstream’
services, not the roll-out of new
practice
Ability to provide risk capital to fund the
expansion of services
Variable implementation of
preventative and complex
programmes
Stimulates a focus on performance
management to protect investment
Grants are precious resources, yet can
only be used once and do not always
lead to financially sustainable change
Resources can be re-cycled once investment
repaid, sustainability central to approach
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SOCIAL INVESTMENT MAY ENABLE THE SOCIAL SECTOR TO
SCALE UP
Charities and social enterprises are already providing valuable services to the NHS, but these
are often small and at the margin of core services.
•
An analysis of a sample of 2012/13 community health contract awards by provider type1 illustrates the issue.
•
Anecdotal evidence suggests that financial barriers remain for third sector providers in winning core service
contracts, creating an uneven playing field for these organisations to compete for the larger contracts won by the
private sector and NHS Foundation Trusts.
Number of contracts won by organisation type
Average value of contracts won by organisation type
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1 Survey of contracts awarded in 2012/13 identified as with the search term “community health” as detailed on UK health procurement portals (primarily
http://www.supply2health.nhs.uk/default.aspx and http://www.publictenders.net/).
NB:
Primary
Care 2014
Trusts were abolished March 2013 as part of the NHS reforms. Some of the services which were previously managed by local PCT will be transferred to Clinical
©Social
Finance
Commissioning Groups (CCGs),
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SOCIAL INVESTMENT CAN BE DEPLOYED IN DIFFERENT WAYS
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Segmentation is already developing around the role that social investment is asked
to perform, the risks that social investors take and the complexity of new models.
Greater complexity / greater impact
Financing for
expansion from
socially-motivated
partners
Support for due
diligence rigour
Investment in
management systems
and infrastructure
Whole
pathway
redesign
New delivery
models
New contract
models
Integration
of services
Funding social enterprises to expand or
enhance activity
Funding for whole system or pathway change
Examples
• Avante Care Partnership
• Shared Lives Incubator
• Care and Share Associates
Examples
• A SIB to fund enhanced community end-of-life care
provision
• Social isolation SIB
Commissioner change required
• Variable – potential contractual expansion, flexibility
around delivery and funding model
Commissioner change required
• High – will have key role in reorganising whole
system of care provision
Provider change required
• Variable – potential expansion of service offering
(scope or scale), investment readiness work
Provider change required
• High – likely to require degree of coordination,
integration and management above providing
established service
©Social Finance 2014
SOME OF THE AREAS ACROSS HEALTH AND SOCIAL CARE IN
WHICH WE ARE WORKING TODAY
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Social isolation and
self-care for long-term
health conditions SIB
A SIB to fund scaling of
community volunteer
resources to support
those with long-term
health conditions
A SIB to fund enhanced
community end-of-life
care provision
National expansion of
Shared Lives social
care
Support for a
community health
mutual to raise
investment in services
Developing a social
investment strategy
across health and social
care for a local authority
A care and wellbeing
social investment
fund
Better aligning services
across health and
employment
Working with a group of
Almshouses to invest
in new extracare housing
©Social Finance 2014
APPENDICES
©Social Finance 2014
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EXAMPLE: REDUCING SOCIAL ISOLATION AND LONELINESS IN
WORCESTERSHIRE
An ageing population, the changing nature of community and family life, and significant NHS and local
government budget pressures together require health and social care commissioners to think innovatively about
how to help maintain people’s health and develop new models of care.
Loneliness and social isolation are now recognised as one of the key determinants of health and well-being
among older people but are historically under-invested in and poorly addressed.
• Social Finance’s analysis suggests that effective programmes to reduce loneliness and isolation can deliver significant
value for individuals and the health and care system as a whole.
• However, previous experience suggest that it can be difficult to design and deliver effective services. Many fail.
• This is therefore an area where commissioning differently – on the basis of outcomes – could have a significant
advantages. A Social Impact Bond could transfer the risk of service implementation to social investors and allow the
commissioners to pay only if loneliness is decreased across a population of older adults.
Outline approach
INVESTORS
Payments on
basis of
outcomes
Funding
Lead delivery organisation
Befriending
Group Activity
and Exercise
CBT for most
isolated
Reduced loneliness
©Social Finance 2014
Commissioners
- CCGs, Local
authorities, central
government
Reduction in
loneliness
Peer support
groups
SOCIAL FINANCE HAS UNDERTAKEN MODELLING TO BETTER
ASSESS THE COSTS OF LONELINESS
Social Finance has modelled some of the short and medium term health and social care value
associated with long-term conditions developed as a result of loneliness. Total value will be
higher.
©Social Finance 2014
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EXAMPLE: THE CARE AND WELLBEING FUND
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Social Finance is developing a £20+m proof of concept social investment fund focused on health
and social care – the Care and Wellbeing Fund.
Our aim is to serve both a wider range of investors and delivery organisations. Through this we
hope to catalyse delivery of impact and financial returns.
The Fund’s objective is:
‘To improve health and wellbeing in the UK with particular focus on disadvantaged groups such as the
frail elderly, those with a long-term health condition and those with a disability.
The Fund aims to support, with investment, the growth of ambitious charities, social enterprises and
ventures which deliver improved wellbeing. The focus will be on prevention, early intervention and
community-based solutions.’
Investment Strategy
Risk capital:
• to support growth and development of
social enterprises and social purpose
businesses
• to generate defined and measurable
impact
•which is a form of repayable funding
Key Themes
• Ageing and long term conditions
• Disability
• Health improvement
• Health and employment
• Service innovation
A strongly mission-driven fund, seeking to attract socially motivated investment with
cornerstone funding from Big Society Capital matched by co-investors
©Social Finance 2014
IMPACT FRAMEWORK
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The Fund will target specific investment themes and will have a defined framework for
assessing and measuring social impact results
Fund Themes
1. Ageing & Long
term conditions
2. Disability
3. Health
improvement
4. Health &
employment
5. Wider
innovation
Direct Impacts*
A. Improved health &
wellbeing
e.g. delaying onset of ill-health and
recovery from ill-health
B. Reduced health &
economic inequalities
e.g. greater access to services and
employment for economically
disadvantaged groups
C. Greater independence &
dignity
e.g. improved feelings of
independence, control & life
satisfaction
System Impacts*
D. Replicable/scalable
approach
e.g. scope for widespread
adoption
E. Building capacity of local
health & social care system
e.g. supports local service
integration
F. Improving financial
sustainability of health &
social care system
e.g. greater value for money
than current practice
* We will target investments that meet three of the impact criteria including both direct and system impacts.
©Social Finance 2014
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THANK YOU
©Social Finance 2014