This study compares the cost of treating 23 children admitted to a residential treatment unit in a psychiatric hospital and 23 children admitted to the same unit after it was converted to a day treatment program, through a retrospective chart review. The two groups were similar in age, gender, diagnosis, severity of pathology, family functioning and support, the number of subjects who dropped-out, and treatment outcome. The average length of stay on the unit dropped from 19.6 to 6.1 months, and the average cost of treatment per child decreased from $61,412 to $9,213 (Canadian dollars, adjusted for inflation). The sharp decrease in treatment time with day treatment may be the result of close links with community schools and maintaining the child in the family and community. The cost savings can be attributed to the shorter hospital stays and the lower operating costs of day treatment. Implications of these findings will be discussed with respect to health care policy including the need to raise awareness of day treatment as a cost-effective alternative to residential hospital treatment.
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