To do a cost-benefit or cost-effectiveness analysis, organizations must first accurately calculate the total cost of running a program. This information is important to monitor even if a program is not planning to perform a cost-benefit analysis. (For example, it would be important for programs to be aware if the average cost per participant is increasing over time and why.)
Calculations of program costs should include both financial and economic costs.
Financial costs are monetary expenditures for resources required to implement the program. This type of cost is typically found in the organization's budget, and should be based on fair market prices. Examples of financial costs include:
- Salaries for project personnel
- Supplies
- Program administration (usually based on the percentage of an organization's administrative costs dedicated to a particular program)
- Physical space and utilities (also based on a percentage of the organization's total costs)
- Travel
- Participants' out-of-pocket expenses
Economic costs (or opportunity costs) are the value of forgone benefit because resources are not available for their next best use. These should also be based on market value. For prevention programs, these might include:
- Volunteer hours
- Donated space
- In-kind donations
Be careful not to overlook resources that are difficult to measure or value, resources used in small amounts, or resources already purchased. Costs to evaluate the program are typically not included in the calculation of program costs, unless it is considered essential to future program implementation.
** Adapted from: Corso, P.S. (2003). Cost-effectiveness analysis for the multi-site evaluation. Washington, DC: National Center for Injury Prevention and Control, Centers for Disease Control and Prevention.
Budget Basics: Child Welfare (PDF - 496 KB)
Missouri Budget Project (2017)
Provides information on Missouri’s budget, including how funds are allocated, how much different programs cost, and the size of the served populations.
CBCAP Peer Learning Call: Cost Analysis: Understanding the Framework [Webinar]
FRIENDS National Center for Community-Based Child Abuse Prevention (2015)
Outlines the basic steps needed to simplify the cost-analysis process in a practice-oriented framework. This webinar provides information on how to consider the value of a program's resources, understand the effectiveness of a program, and strengthen the relationship between the costs of services and the outcomes.
Child Abuse and Neglect Prevention Program Cost Calculator
Centers for Disease Control and Prevention
Uses recent data to help estimate local costs of certain child abuse and neglect prevention programs. The available programs have published per-child or per-family costs and can be customized by State.
Child Welfare: Inventory and Benefit-Cost Analysis
Kramer, Rousey, & Bernardy (2018)
Results FirstExamines the benefits and costs of child welfare services in Minnesota. It examines 74 services that aim to prevent or reduce maltreatment using the Pew-MacArthur Results First Framework, which allows the State to estimate cost-effectiveness using national evidence.
Cost Analysis
FRIENDS National Center for Community-Based Child Abuse Prevention
Defines what cost analysis is and how it can be used to identify the full cost of a service. It also provides links to additional resources that provide a more indepth guide to cost analysis and how to conduct a study.
Costs of Early Childhood Home Visiting: An Analysis of Program Implemented in the Supporting Evidence-Based Home Visiting to Prevent Child Maltreatment Initiative (PDF - 1,310 KB)
Burwick, Zaveri, Shang, Boller, Daro, & Strong (2014)
Mathematica Policy Research
Assesses the cost of home-visiting programs and how costs were allocated among program components. It also lists the cost of serving a family and the costs of the programs, including implications for program implementers and other stakeholders.