Are Social Impact Bonds the Answer to Limited Healthcare Resources for Improving Health Promotion and Disease Prevention?

OBJECTIVES: Prevention and health promotion are longstanding health system goals. However, the widely advocated reallocation of resources to achieve these goals has yet to be materialised. Considering the positive societal impact of healthy populations, investment from other government and economic sectors is a potential solution to this deadlock. Social impact bonds (SIBs) constitute a financing model that may attract investments that can supplement spending on health promotion. In this study the characteristics of SIBs, in health or other settings, were examined to explore the viability, and feasibility of this financial construct.

METHODS: A systematic literature review of studies available on MEDLINE was supplemented with snowballing of relevant citations and hand-search of grey literature. Seven semi-structured expert interviews with academics and social impact investors were conducted, verbatim transcribed, and analysed using inductive and deductive thematic analysis.

RESULTS: Literature findings emphasized the viability of SIBs through stronger outcomes focus, increased flexibility and more stable funding at provider level, potential cost savings, increased transparency, better risk sharing and promotion of innovation. In contrast, interviews often highlighted real-world political and bureaucratic issues during implementation, while the line between perceived and true advantages was often reported to be blurry. On the other hand, the limitations of SIBs are potentially high transaction costs, gaming and wrong-pocket problem and a restrictive effect on programme scope. Public cost savings were rare within SIBs and risks were often unbalanced among stakeholders.

CONCLUSIONS: SIBs have good potential to increase the flexibility of public health service provision, enhance data collection and performance monitoring, and test innovative solutions. However, many feasibility criteria must be met before launching a SIB and it is only worthwhile if the intervention is capable of achieving large-scale impact. SIBs, as currently implemented, are unlikely to meet the expectations for addressing the lack of available resources for health promotion and prevention programmes.