An Australian study evaluating the cost-effectiveness of the Butterfly Foundation Residential Eating Disorders Treatment (B-FREEDT) Model of Care

Eating disorders are serious mental health conditions associated with significant economic and quality-of-life burden. This report includes the results of 6 studies that were conducted to evaluate whether Wandi Nerida, a residential care program for people with eating disorders, resulted in improvements in residents’ quality of life and health outcomes and also whether the cost associated with Wandi Nerida represents good value for money. There were a number of evaluation questions that were answered, each of which helped to determine the effectiveness and cost-effectiveness of Wandi Nerida. Care in Wandi Nerida was found to result in improvements in quality of life and reduced healthcare costs for its residents (when compared to quality of life and service use before entering Wandi Nerida). However, Wandi Nerida might not represent good value-for-money if it is implemented at the population level since care in other services results in similar outcomes, although it takes longer to achieve those outcomes. Furthermore, there are large out of pocket costs associated with the current funding of Wandi Nerida. The majority of costs at Wandi Nerida were borne by its residents; of which, a third were reimbursed by private health insurance. It is recommended that Wandi Nerida would need to be operated as a publicly funded residential care service similar to existing residential care services for mental disorders for cost-effectiveness to improve. There also needs to be a focus on improving the operational efficiency of Wandi Nerida to reduce the costs of service delivery. Further research is needed to explore alternative pathways of complementary service delivery models for eating disorders as well as to identify the most appropriate target population for this model of residential care.