Is headspace making a difference to young people’s lives?

6. The Costs of headspace
One of the main aims of the evaluation was to conduct an economic evaluation of headspace.
The economic evaluation aims to assess whether headspace offers good value for money and to
estimate future program costs based on possibilities for national expansion. This chapter presents
the main findings of the economic evaluation by key research question. The economic evaluation
was conducted by different consortium members. The cost effectiveness analysis was conducted
by researchers at the Bankwest Curtin Economics Centre (BCEC) at Curtin University, and the
centre expansion and national coverage analysis was conducted by researchers at the Telethon Kids
Institute at the University of Western Australia. The centre expansion and national coverage analysis
is contained in Appendix B.
Findings for the economic evaluation reported in this chapter were informed by multiple data sources
including:
• headspace Centres Service Application
• headspace Centres Finance Application (centre-level)
• headspace National Office program management cost data
• additional data on MBS expenditure obtained from the Department of Health, and
• evaluation survey data collected from headspace clients and a comparison group of young
people.
6.1 What are the overall costs of headspace?
The first step of the economic evaluation was to estimate the total cost of services provided by
headspace centres. To this end, the goal was to estimate the total costs and the total number of
occasions of service as indicated in the following formula:
Cost per occasion of service =
Total in-scope costs ($)
Total in-scope occasions of service
In-scope occasions of service
headspace centres throughout Australia deliver a variety of services to young people, ranging from
services specifically related to physical and sexual health problems to services targeted at mental
health and behavioural issues and those that relate more closely to vocational and alcohol and drug
problems. Services are provided by different practitioner types for differing durations and intensity.
A young person visiting a headspace centre can receive any combination of service types throughout
the course of their treatment. Generally, the majority of young people that visit headspace receive a
mental health service as their main type of service – 63% of services (Figure 6.1). The second most
common service provided to young people is that related to engagement and assessment. These
services constituted 23% of headspace services in the 2013/14 financial year.
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