‘Put Your Money Where Your Mouth Is’: Indiana Wants Reading Gains Before Paying
State is latest to try outcomes-based contracts as it hires tutoring companies to boost middle school reading.
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Indiana doesn’t have a plan to solve middle school students’ reading struggles, so the state is looking to hire private tutoring companies to “put your money where your mouth is,” with pay dependent on results.
The Indiana Department of Education is the latest to try “outcomes-based contracting” — a pay-for-performance strategy that hires companies to tackle thorny education issues and pay them largely based on how much students improve.
Indiana’s task: Helping catch up from missing school during the pandemic.
State education secretary Katie Jenner said she and her staff looked at other states for guidance on how they solved middle school reading troubles, but found none successful enough to copy.
But companies and non-profits contacted her all summer offering solutions after the state announced that middle school reading scores fell last year, she said.
“Not a day goes by that I’m not pinged multiple times by vendors across our country who have the next best thing since sliced bread,” Jenner told the state school board last month.
“Put your money where your mouth is,” Jenner said. “If you are awesome and outstanding, move the needle. Help us move the needle for kids, rather than us just writing a check for millions of dollars and it still being status quo.”
Jenner’s not saying yet how the state will structure contracts — how much pay will be guaranteed and how much incentive-based — or even if the state will put out a formal request for proposals for the work. But several other states, including Texas, Florida and Arkansas, have examples and lessons on how to do it, as does the Center for Outcomes-Based Contracting created in 2024 by the Atlanta-based Southern Education Foundation.
“It brings clarity, aligns goals, and ideally creates real accountability across both the provider and the district,” said Mike Cohen, CEO of Cignition, a virtual tutoring company that met many of its contracted learning goals in Denver. “That said, there are definitely risks — especially when external factors like student attendance or district scheduling are out of the vendor’s control.”
He added: “If students don’t show up, it’s very hard to deliver outcomes, no matter how strong the instruction is.”
The center suggests having at least 40 percent of a contract dependent on clearly-defined student gains, though results so far have been mixed and advocates are still refining how to set goals and compensation.
The model is gaining in popularity. After backing a pilot with just four districts in 2022, the Southern Education Foundation now counts 60 districts and regional or state education agencies as testing the strategy.
Whether this model helps students learn more is unclear. Research is limited, so evidence of success remains anecdotal. Because some students usually improve and others don’t, schools typically pay per-student bonuses for a percentage of students, while vendors receive no extra pay for the remainder.
The that about half of the learning goals spelled out in member contracts in 2025 were achieved, with vendors earning about 68 percent of possible bonuses.
“As this work has started to scale, we’re starting to see that the rigor and integrity of the contracts are being maintained, and we’re seeing more and more outcomes for kids, which is the whole point of the work,” said center executive director Brittany Miller.
The idea of basing pay on performance isn’t new. Salespeople have long been paid by commissions, while executives and athletes have bonuses as big parts of their contracts. But school districts and states don’t often build contracts with outside companies around results.
That started to change right after the pandemic when some districts started hiring tutors with incentives as they used pandemic relief money. Two of those — Ector County Independent School District in Odessa,Texas, and Duval County Public Schools in Jacksonville, Florida — saw many students make strong gains, while others didn’t.
Duval County is still using the approach, the district told The 74, and now offers 50% guaranteed pay and 50% incentive-based.
“The approach is working well, boosting student growth in math,” said district spokesperson Sonya Duke-Bolden, with fewer 9th grade students needing math help than before.
Ector County hasn’t used the model once its pandemic tutoring contracts ended, however, and is still evaluating if it would use it again.
The Denver Public Schools are in a similar position, after Cohen’s Cignition achieved strong results and the other didn’t and was unable to collect much of the bonus pay.
after studying eight districts that adopted the strategy as they used pandemic-relief money for high-dosage tutoring. Researchers wrote that districts and vendors worked together closely and tracked student data intensely since pay was so dependent on results.
Vendors told researchers they appreciate a chance to showcase their curriculum, staff or online learning program, but are hesitant to embrace the contracts when results are so dependent on students actively participating and on imperfect measures of gains.
“OBC fosters collaboration, improves service alignment with student needs, and enhances data tracking,” researchers found. “However, financial risks for vendors and the complexity of implementation pose challenges.”
As with most outcomes-based contracts, Indiana’s will center on struggling students, who often have attendance and motivation problems too, so gaining results won’t be easy.
“We’re already working with a population of students that we would deem not at grade level or struggling in some capacity when it comes to their reading skills,” said Anna Shults, chief academic officer of Indiana’s education department. “These are students that have been probably given a plethora of support along their entire educational continuum, and it’s just still not working.”
Shults said the state will look to the , a part of the non-profit American Institutes for Research, or the , an arm of the U.S. Department of Education, for vendors that have promise. Districts could then choose to tap into a still-undetermined pool of state dollars to hire tutors.
Jenner is also seeking donations and grants to help cover contracts.
Even as she sorts out the details, Jenner is excited by the concept, on broader education issues. She told the committee it’s a careful way to take on the state’s reading problem.
“We will only pay if a partner helps us deliver outcomes for our students,” Jenner said. “It’s our responsibility to make sure in Indiana we are getting a return on investment.”
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Patrick O’Donnell is a correspondent at The 74, covering the impact of the pandemic on America's education system
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