The World’s First Health Impact Bond Can Save 10,000 Women And New-Borns In India
About 0.75 million new-born children die every year in India, which is the largest number for any country in the world. Four states—Uttar Pradesh, Madhya Pradesh, Bihar and Rajasthan—alone contribute to 55% of total neonatal deaths in India (J Perinatol, 2016).
A new Development Impact Bond was announced by Mark Green, the USAID International Development Administrator, with an aim to reduce the number of mother and baby deaths in the Indian state of Rajasthan.
Developed by Merck for Mothers, USAID, the UBS Optimus Foundation and the Hindustan Latex Family Planning Promotion Trust (HLFPPT), it will be the world’s first health impact bond. Named after a Hindi expression meaning “excellence”, the Utkrisht Impact Bond will support implementing partners, Population Services International (PSI) and HLFPPT, to improve healthcare facilities and provide quality health services in the region. The impact bond is expected to save the lives of up to 10,000 women and new-born babies over the next five years.
“We need innovative and sustainable financing models to help solve some of development’s vexing challenges” – stated Karl Hofmann, President and CEO of PSI.
Focused on outcomes, impact bonds are an innovative way to finance development. Using public-private partnerships they have the leverage to finance build and challenge some of the world’s biggest challenges.
The Utkrisht Impact Bond will enable financial assistance for the 440 Small Healthcare Organizations to improve the quality of maternal and child care in the Rajasthan’s hospitals and adhere to the government quality standards.
The Utkrisht bond partners will receive social and financial gain. For instance, the private capital from UBS Optimus Foundation will cover the costs to develop private healthcare services and facilities in Rajasthan, while HLFPPT and PSI will help them get certified. USAID will then payback the investment “only if the providers achieve certain concrete results” in reducing the number of mother and baby deaths, stated Mark Green.
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