In early 2008, Tennessee’s Department of Children’s Services has recognized Youth Villages for its performance in better serving youth in State custody under a new performance-based contracting system instituted by the State.

“We’re very proud of our track record of helping troubled youth find stable and supportive living environments,” said Youth Villages executive director Patrick Lawler. Youth Villages’ continuum of care for troubled youth utilizes evidence-based programs to teach young people how to function successfully in school, at home and with peers.

In 2006, Tennessee implemented a financial incentive model in hopes of achieving “permanency” for children in state custody more quickly – by reducing average length of stay, increasing exits from state custody, and decreasing re-entries into care. Among the criteria that the State used to evaluate various service providers were their ability to reduce the number of days that youth are in State custody and helping greater numbers of youth find safe permanent homes.

Patrick Lawler continued, “Tennessee is a leader in implementing sophisticated systems of accountability for its child welfare system. Government agencies have traditionally shied away from awarding contracts based on “performance” for social services, although it does so in many other areas of State concern, like road construction. Our experience shows that performance-based contracting can work in this field as well.”

In the first year of Tennessee’s experiment, four private providers, in addition to Youth Villages, participated in a performance-based contract that rewarded providers financially if they were able to meet or exceed certain goals. Youth Villages saved the State almost 10,000 care “days” while helping 22% more youth than expected find “permanency” during the fiscal year.

Suzanne White, Director of the Department of Children’s Services’ Child Placement Office stated, “The Department is extremely encouraged thus far regarding the results associated with this new initiative. The positive outcomes we've seen under this program from organizations like Youth Villages lead us to be confident that recognizing and ‘incentivizing’ service providers for performance has the potential to reshape how we, as a Department, can help provide the children in our care, and their families, with the best opportunity to lead successful productive lives.”