ABSTRACT
Cost-effectiveness and benefit-cost analyses are means of assessing a program’s efficiency. Benefit-cost analysis is an important evaluative approach because of the interest in funding social programs with the largest net benefits. Efficiency assessments provide a frame of reference for relating costs to program results. In benefit-cost analyses, both program inputs and outcomes are measured in monetary terms; in cost-effectiveness analyses, inputs are estimated in monetary terms and outcomes in terms of actual impact. Cost-effectiveness analysis can help policymakers decide which service approach may be most efficient by comparing the unit cost of service per family of various programs. Child placement is an expensive service that may be reduced or prevented if a Family-Based Service (FBS) program is able to target high-risk children and effectively serve them. Designing and conducting a benefit-cost analysis as part of an evaluation of FBS requires special technical expertise. The program being evaluated may have secondary effects that produce extra benefits or costs.
