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Comparative Cost Analysis of Home Care and Residential Care Services (NA0101-1)

Recipient: Hollander Analytical Services Ltd.

Contribution: $40,000.00

This first study of the National Evaluation of the Cost-Effectiveness of Home Care set out to determine the relative costs to government of home/community-based services compared with those of residential long-term care services, by level of care, in the British Columbia setting. Using a unique linked database at the University of British Columbia, the study followed four cohorts of new admissions to the British Columbia continuing care system between 1987 and 1997 and tracked subjects’ use of home care, residential care, physicians, hospitals, and pharmaceuticals from one year before the first assessment and for three years after the assessment. The costs were compared overall and by the five care levels used in British Columbia. The study found that home care is generally cheaper, at all levels of care, than is care in residential facilities. The costs, however, are in the transitions. Home care is much cheaper for governments if the clients are stable in their type and level of care than for those who change their type or level of care. The costs for stable clients are about one half of the costs of clients who are in transition. The study found that 30 to 60 per cent of the costs for home care clients are for hospital care and that traditional services, such as home nursing, account for only about one third to one half of overall home care costs.

Fact Sheet


This project was supported by the Health Transition Fund, which was created in 1997 to provide support for evidence-based decision-making in health care reform by supporting pilot and evaluation projects which test innovative approaches to health care delivery. The views expressed herein do no necessarily represent the official policy of federal, provincial, or territorial governments.


Last Modified: 2005-08-29