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Conduct a Cost Analysis of Your Home Visiting Program

Assessing and
Compiling Your Data

What Data Will You Need for Cost Analysis?

The next section will help you understand what data you need to conduct different types of cost analysis. There are three basic kinds of information needed for cost analysis:

  1. budget information (e.g., program costs, staff salaries, etc.);
  2. information about services delivered (e.g., number of children and/or families served or number of home visits delivered); and
  3. information about time spent by staff on various tasks (e.g., time spent delivering home visits, conducting screening, etc.).

Information about no. 3, staff time, may not be something you need to include – it depends how detailed you want your cost analysis to be (see below).  On the other hand, even the most basic and simple cost analysis requires basic information about program costs and numbers served. To see what kind of cost analysis you can conduct with the information you have right now, complete the check list on the next page.

Collecting Staff Time Estimates: Why is This Important?

If you are interested in breaking down costs associated with specific components of service delivery – for example, how much your program is spending to conduct screenings for eligibility, actually conducting home visits, or completing paperwork – then you will need to collect information about how much time staff spend on these tasks. There are several ways to do this, each with different pros and cons.

The first method, and generally the most accurate, is to ask staff to keep detailed track of how much time they spend on various tasks for a short period of time. In some studies, staff are asked to conduct "random time studies" in which they track their time for days or time periods that are randomly selected. While this may provide the most accurate representation of how staff are spending their time, for most purposes selecting a typical week and asking staff to keep track of their time should suffice to give you reasonable estimates. What tasks you ask staff to keep track of depends on which components you are most interested in including in your cost analysis. Here is an example of a worksheet that staff could use to keep track of their time for a week.

Interview Method
Another approach is to simply ask staff to estimate how much time they spend in a typical day or week doing each task you are interested in estimating. You could use the time study worksheet to gather estimates from staff rather than asking them to actually track their time. However, it is important to note that these estimates are likely to be less accurate than collecting time study data. If staff estimates vary widely, you may want to reconsider your approach and gather time study data instead. This would be a "red flag" that staff aren’t accurately estimating the time they spend on various tasks.

Compiling the Staff Time Data
After staff complete this sheet or something similar, you will need to compile the informationNote that this tool will calculate the cost of program components such as screenings, volunteer costs, outreach costs, home visit costs, and other service component costs –without including any indirect costs. For example, the cost per home visit includes only the hours and the direct salary and benefits of the staff performing the home visit. All indirect costs for the program are separated out into the indirect cost category. If you are able to calculate your indirect cost rate and would like to include indirect costs in a particular category such as home visits, you would simply tack on the indirect rate percentage to the cost per home visit calculated by this tool. For example, if the cost per home visit is $100 and your indirect cost rate is 15%, your home visit cost (including indirect costs) would be $115.  and compute the average amount of time your staff are spending on a given task.
Use this worksheet to compile the time spent on each task. For each task compute the average across all staff (see last column). For example if Home Visitor #1 spent 25 hours delivering home visits, Home Visitor #2 spent 15 hours delivering home visits, and Home Visitor #2 spent 30 hours delivering home visits, the average amount spent on home visits per home visitor would be equal to 25.33 hours.