Economic evaluation of Early Intervention (EI) services: phase IV report

Paul McCrone, A-La Park and Martin Knapp

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: In this report we present findings from Phase IV of a programme of work assessing the economic impact of early intervention (EI) services for people with psychosis. We have focussed on the following areas: (i) the impact of EI on vocational outcomes, (ii) the impact of EI on homicide costs, (iii) the impact of EI on suicide costs, and (iv) the long-term economic impact of EI. The main findings are as follows: (i) EI results in substantially reduced costs of lost employment. This is due to estimated employment rates of 36% and 27% for EI and standard care respectively. Using a minimum wage rate the average savings are £2087 in addition to healthcare savings previously demonstrated. (ii) The cost of homicide is low for both EI and standard care. However, for EI the annual costs of homicide (£6 per person) are £80 per person lower than for standard care (£86 per person). (iii) Suicide is assumed to occur for 1.3% of EI patients and 4% of standard care patients. The estimated annual saving in suicide costs due to EI is £957 per person. (iv) The long-term economic impact of EI depends on what happens to readmission rates after a patient is discharged from the EI team. If the readmission rates remain constant then the expected savings over eight years are £36,632. If rates converge immediately after EI team discharge the figure is £17,427. Finally, if the rates converge gradually the expected savings are £27,029. This paper has reinforced the findings from earlier work that EI is likely to have beneficial impacts. These will be experienced in terms of increased work, decreased suicide and decreased homicide.

JEL-codes: J1 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2010-11
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:39340

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