Milestone Payment System

1. Milestone Payment System Outcomes Achieved & Application to Other Systems

2. “Facts are stubborn, but statistics are more pliable.” Mark Twain

3. Awards & Recognition • Finalist in Innovations in American Government ’97 sponsored by Ford Foundation/Harvard KSG • Received a $20,000 Ford Foundation Dissemination Grant • Winner of 1997 Better Government Competition, Pioneer Institute, Boston, Massachusetts • Finalist Council of State Governments Competition ’97 • Interviewed and written up by the Urban Institute, Washington, D.C. and the Terry Sanford Institute of Public Policy, Duke University

4. Results • 1997 Survey: 81% of providers had shown improvement in all contract areas • Time on waiting list - reduced by 53% • Time before placement reduced by 18% • Assessed but never placed reduced by 25% • Data entry items reduced 98%, 18,000>100 • 102% increase in # consumers succeeding • 95% succeeding in first job placement • 30% increase in placements

5. Cost Comparisons

6. Provider Responses • Kennedy School of Government Interviews of Providers in 1998 • 36% of providers said transition to Milestones was challenging • Most providers cited reduction in paperwork as a “best benefit.” • “Everyone understands their role” • “Job placement receives more attention”

7. Provider Responses • Survey in 2000 conducted by Kennedy School of Government • 57% said transition to Milestones was easy • 45% said Milestones afforded a great deal of flexibility • 55% said they had a lot of input in fine-tuning their contracts with DRS • 50% said milestones were extremely accurate in measuring client progress. • 65% of providers said milestones did not encourage creaming in selection of clients to serve

8. Provider Responses • 75% rated their overall experience with milestones as good or excellent. • “Milestones gives us a sense of accomplishment because the outcome is more clear.”

9. Ticket to Work Act

10. Replicating Milestones Concepts • Kansas Milestone Approach for Child Welfare Services • Milestone Case Rate • 1. Child referred to contractor (process) 25% • 2. 60 day report to state (process) 25% • 3. 180 day report to state (process) 25% • 4. Child achieves permanent placement (performance) 25%

11. Replicating Milestones Concepts • Kansas Child Welfare Services • Contractors are compensated at fixed rate for the accomplishment of specific milestones • Contractors may incur loss if they do not meet milestones for a particular client • Agency can control amount of risk by including a mix of performance milestones and non-performances (input and process), as well as varying the weight assigned • A case rate (based on average cost of care) was negotiated with contractors who received a proportion of that case rate, known as a progress payment, when they accomplished any of the 4 major milestones. In the case of Kansas, only one of the milestones was performance related, and the other milestones were essentially process measures. Agency performance on these measures determines whether or not contracts are renewed.

12. Replicating Milestones Concepts • Foster Care In Wayne County, Michigan Foster care providers participated in a pilot PBC initiative in 2000. The providers agreed to be paid a reduced administrative per diem rate along with an upfront initial per child payment and additional bonus payments when certain milestones were reached. • Example: • Initial payment $ 2,210 • Placement with parents, family members, guardian or IL within 270 days $ 1,900 • Sustained placement of 6 months $ 1,290 • Sustained placement of 12 months $ 1,600 • Termination of parental rights within 515 days $ 1,900 • Adoption within 7 months of Termination of Parental Rights (TPR) $ 1,290

13. Replicating Milestones Concepts • Example from Federal Contractor