Paying for Success: Results Based Funding

State Vocational Rehabilitation (VR) agencies and other funding agencies purchase employment services from providers through a variety of purchase of service (POS) arrangements. Historically with supported employment, fee-for-service arrangements with hourly rates have been the predominant payment method utilized. Recently, a number of states have moved to a more outcome/results based payment approach. The distinguishing feature of a results based funding arrangement (RBF) is that at least a portion of a provider’s compensation is contingent upon the achievement of specified outcome performance measures. In contrast, more process oriented funding approaches, such as fee-for-service, base payment on units of service delivered, not specific outcomes achieved.