School of Public Policy Capstones

Preventing Congestive Heart Failure Readmissions with Social Impact Bonds: A Feasibility Assessment

Anna Ivanova, University of Massachusetts - Amherst


Social Impact Bonds (SIB) is an innovative financial instrument meant to align the interests of nonprofits, governments, and private investors in order to fund preventive programs targeting pressing social issues. This paper explores potential application of this instrument to preventing avoidable readmissions due to congestive heart failure. The paper begins by looking at the concept of SIB, its spread throughout the world as well as benefits and risks that it brings along.

Literature also helps define a set of criteria that are applied throughout the research to determine feasibility of SIB application. The main method used in this paper is a critical analysis of multiple sources: from peer-reviewed medical journals to newspaper articles and conference presentations. Casting a wide net allowed uncovering important nuances of CHF, affected populations and socioeconomic context that make interventions harder than they may seem. Significant attention is paid to current policy and how it impacts actions and motivations of various actors in the healthcare system. A high level of activity around reducing readmissions does not always lead to the outcome that Centers for Medicare and Medicaid intended. We further look into existing interventions that have been around for many years and those that are only in the process of validation. The next generation of interventions places more emphasis on the community component of transitional care, and given the socioeconomic determinants of CHF, we believe it to be important as opposed to the existing light-weight models that might prove to have only a limited impact in the low-income and minority populations which SIB should target. Controversy around 30-day readmission as a quality measure is brought to light and it is noted that it can impact safeguards procedures of SIB.

We conclude by summarizing opportunities and risks of going forward with the SIB right now and recommend waiting until results of recently piloted interventions are in to make a more informed decision. In the meantime, we suggest approaching key players among nonprofits and foundations to better estimate the chances of introducing SIB in this space.