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Comparing costs in evaluating services for severely troubled children and youth in care


Background. In the UK, services for severely troubled children and youth in care are funded almost entirely through public money, although their cost is often shared between a range of different agencies (social services and education, now integrated into children's services departments), health, youth justice and others. One of the major methodological challenges to research in this area is to identify how much different services cost, and how far costs can be related to outcomes.

Initiatives to increase the evidence base of interventions with vulnerable children and families are a necessary component of the debate on how to promote satisfactory welfare outcomes. Evidence based research frequently has an economic component, but this is often peripheral to its central concerns. This paper argues that developing methodologies that help us better understand the costs both of providing and not providing services is central to the development of effective interventions.

Research question. How can we compare costs and effectiveness of services for troubled children and youth in care?

Methods. This study is part of an extensive programme of research and development that utilises a range of methods. The costing studies adopt a triangulated approach whereby activity data about case management processes are collected from focus groups and verified against time-use records completed by practitioners for specific cases. Unit costs are then calculated using service level data concerning staff salaries and overheads. Child level data showing the frequency of case management processes and the number of days/hours in receipt of services as well as items such as age, cost related needs, and outcomes are identified from management information systems. A software application (the Cost Calculator for Children's Services) links the child level data on children's characteristics, experiences and outcomes to the unit costs of case management and service provision to calculate the costs incurred by individual or groups of children over user-specified time periods. Reports include costs of service provision related to outcome data. At present social care and education costs are included in the model. Funding has now been received to extend the model to include health and mental health services and to explore the cost effectiveness of these support services provided to looked after children with complex needs. There are plans to develop youth justice and socio-legal costs and include them in later versions.

Key findings and implications for the costs of new programmes. A diverse group of children and young people enter the English care system; both costs and outcomes are closely related to their needs. About one in four have no apparent additional needs. These children tend to be placed in foster or kinship care; their care histories are relatively stable and outcomes reasonably satisfactory. These are the children who cost the least, about £33,000 per year. However many children and young people in care are troubled; they have complex and severe emotional or psychological difficulties and display challenging behaviour patterns. At least 50% of children and young people in the English care system have been found to have emotional or behavioural difficulties of similar severity to those shown by a clinical population (Meltzer et al, 2003).

In a study of 478 looked after children Ward and Holmes (2008) found within this group are a smaller subset (46: 9%) of very troubled and challenging youth who have complex care histories with frequent changes of placement. They tend to be placed in more costly residential care; they are likely to have a troubled educational history, with 11% (8) having experienced three or more unscheduled school changes and 40% (29) been excluded from school. These are also the young people most likely to commit offences. Social care costs to these young people are almost three times those of the group with no apparent additional needs; we know that educational, health and youth justice costs will also be high. These young people are also at greatest risk of social exclusion, and show the least satisfactory outcomes of care.

Evidence from the United States suggests that structured programmes such as multi-dimensional treatment foster care (Mtfc) may offer a more positive environment for these troubled young people than they currently encounter in the English care system. Mtfc is a model based on social learning and systemic theory devised at the Oregon Social Learning Centre (OSLC). This model provides wrap-around, multi-level interventions for children and young people who are placed as single placements in foster homes. Mtfc is currently being piloted in England, but there are concerns about its potential costs. However these need to be compared not with the average costs of care, but with the costs currently incurred by those troubled children and young people who meet the criteria for selection for the programme. These costs need to be calculated over time, not as a snapshot exercise. Start-up costs are likely to be high and Mtfc may appear costly in the short term, but substantially less so in the long term. There will be additional costs of recruitment, assessment, care planning, finding and supporting placements. However if the programme is successful these will be balanced by lower frequency of case management processes and lower fees. Most importantly, additional costs may be balanced by better outcomes - not only for the services but also for the children and young people concerned.

Key references

Dore, M. M., & Mullin, D. (2006). Treatment Family Foster Care: Its History and Current Role in the Foster Care Continuum. Families in Society: The Journal of Contemporary Social Services.

Meltzer, H., Corbin, T., Gatward, R., Goodman, R. & Ford, T. (2003). Mental Health of Young People Looked After by Local Authorities in England. London: The Stationery Office.

Ward, H. & Holmes, L. (2008). Calculating the costs of local authority care for children with contrasting needs. Child and Family Social Work, 13(1), 80-90.

Contacts: Lisa Holmes, Centre for Child and Family Research, Loughborough University, CCFR, Department of Social Sciences, Loughborough University, LE11 3TU, UK, E-mail: bl.j.holmes@lboro.ac.uk.

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