Skip to content
Globe Icon

Costs and cost-effectiveness of housing and long-term care schemes for older people in England

2012 Conference Presentation

Housing EnglandUnited Kingdom

6 September 2012

Costs and cost-effectiveness of housing and long-term care schemes for older people in England

Theresia Baumker, PSSRU, University of Kent, United Kingdom
Ann Netten, PSSRU, University of Kent, United Kingdom


Extra care housing is a housing model in England that aims to meet the housing, care and support needs of older people, while helping them to maintain their independence in their own private self-contained accommodation. It has been viewed as a possible alternative to, or even a replacement for, residential care. However, there is a lack of robust evidence about the costs of extra care housing, and whether the investment made in new extra care schemes offers an effective use of resources. In the absence of such evidence, in the current financial climate we can expect judgements on investment in and use of such accommodation to be made on the basis of short term financial considerations and cost shunting.

This presentation will report findings from the evaluation of extra care housing by the Personal Social Services Research Unit (PSSRU) in England. Over a four year time-period, the evaluation followed the development of 19 newbuild extra care housing schemes located across England, which received support from the Department of Health’s 2004–2006 capital grant programme. The costs analyses followed key economic costing principles. Costs were measured comprehensively to include as many service components as possible, differences in cost between individuals identified and explored and costs related to outcomes. We report total costs for our sample (n=465) six months after moving in, the components they were associated with and the results of the hierarchical modelling to explore cost variation at the individual and scheme level. We drew on equivalent information collected in previous 1995–1999 national longitudinal and 2005 surveys of admissions to residential care to evaluate cost-effectiveness in comparison with residential care.

To achieve an unbiased comparison, a propensity score approach was used to extract statistically matched samples from the extra care and residential care datasets. As uncertainty covered more than one quadrant of the cost-effectiveness plane, non-parametric bootstrapping was used to construct a cost-effectiveness acceptability curve (CEAC). Using change in physical functioning as the primary outcome measure, the results suggested that, although extra care housing does not appear to provide a direct alternative, there is a high probability that it can support some older people at risk of moving into a residential care homes in a cost-effective way.