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Innovative Finance for a Healthy Generation

Innovation-for-a-Healthy-Generation

Early childhood and adolescence offer an unparalleled opportunity for investment in human capital, including the prevention of NCDs. Over half of the 36 million annual NCD deaths result from behaviours that started or were reinforced during adolescence, highlighting the long-term health potential of focusing efforts on nurturing a healthy generation.

Innovative financial mechanisms can make it possible to accelerate social policy innovation and invest in these societal benefits by funding proven initiatives such as educating and supporting parents or delivering services directly to children themselves. For example, Social Impact Bonds (SIBs) that establish “pay-for-performance” contracts between governments and investors have the ability to aim private capital at achieving measurable progress towards this goal. SIBs have attracted a great deal of interest and are a viable means of funding pre-natal, early childhood, and pre-school services as well as home visiting – all of which are relevant to the prevention of NCDs.

There is a strong economic rationale behind preventing new generations from repeating the mistakes of their parents. Return on investment factors of 9 to 20 are common when evaluating key preventive health services. However, as the benefits often materialize several years or decades after intervention, short term public budgeting has a tendency to overlook these low-hanging fruits.

Later in the life course, access to potentially government-backed insurance schemes is crucial for supporting those persons who do eventually develop NCDs. These could protect households from excessive health care costs that currently push millions into poverty every year. Increasing access to the large selection of cheap generic drugs suitable for NCD treatment could be yet another approach to alleviating such financial burdens and keeping people healthy and productive throughout life.

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