Deloitte Access Economics was commissioned by DDHS to conduct a prospective cost-benefit analysis of the services provided by DDHS, and to establish whether the funding received by DDHS is appropriate with reference to the characteristics and funding of similar organisations, the funding guidelines it operates under, and its costs of service delivery.

The analysis has demonstrated that DDHS delivers superior health outcomes compared to those delivered by comparable health services. As a result of the higher quality service, DDHS’ cost per service is also higher, but DDHS receives less grant funding to provide these services. As DDHS provides superior quality of care, it is reasonable to conclude that, at a minimum, the grant funding given to DDHS should be increased to be in line with the grant funding received by the comparator organisations.

The grant funding provided to comparator organisations to fund the cost of service delivery is 25% higher in terms of funding per FTE, and 31% higher in terms of funding per episode of care. Thus, this report recommends that DDHS grant funding be increased by between 25% and 31% – this is an increase of between $3.1 million and $3.9 million, based on 2014-15 funding levels.