What is the purpose of a Cost Benefit Analysis (CBA)?

The purpose of a Cost Benefit Analysis (CBA) is to systematically evaluate the financial implications of an intervention by comparing the costs associated with that intervention against the savings generated or the benefits gained from implementing it. This approach allows organizations to determine whether the financial benefits outweigh the costs involved, thereby facilitating informed decision-making regarding resource allocation and investment in specific programs or interventions.

By focusing on the comparison of average event costs with the intervention costs, a CBA helps stakeholders understand the economic value of the intervention. It quantifies not only potential savings but also highlights the financial viability of different strategies within healthcare settings, allowing for a reasonable justification of budgetary decisions. This tool is especially useful for nurse executives and administrators who need to present a strong financial case to secure funding or policy support for necessary initiatives.