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Rural Health Information Hub
Rural Health Information Hub

Step 4: Conduct ROI Analysis

ROI analysis compares a program's costs with the financial benefits created. A simple way to calculate ROI is:

ROI = (Program Benefits – Program Costs) / Program Costs

To calculate ROI, rural program leaders need to estimate the dollar value of the benefits, for example, costs saved by avoiding emergency department visits, and compare that to the total cost of running the program.

The Healthy Hearts Education Program calculates ROI using the standard formula:

ROI = (Program Benefits – Program Costs) / Program Costs

  • Program benefits: $308,250
  • Program costs: $275,000

ROI = ($308,250 – $275,000) / $275,000 = 0.12

This means the program generated $1.12 in benefits for every $1.00 spent. In other words, there is a 12% annual rate of return.

Accurate ROI estimates depend on understanding the value of each activity in the program and carefully calculating those values.

Rural programs often face challenges such as small populations, limited data, and fewer staff.

Using mixed methods can help make the most of the available information:

  • Quantitative data (numbers), such as staff time, costs, service volume, and health outcomes — can be entered into a spreadsheet and summarized.
  • Qualitative data (stories and feedback), such as staff insights, challenges, and examples of improved efficiency, can help explain the numbers and capture value that is hard to measure. (See Step 5: Interpret and Communicate Findings)

When possible, rural program leaders should collect data from both the program and a comparison group. Useful data sources include participation logs, financial records, surveys, interviews, and reporting systems.

Once the data is organized, rural program leaders can combine both the quantitative and qualitative information to develop early ROI estimates. They can also describe benefits that cannot be easily measured in dollars, such as participant satisfaction or improved coordination across community partners.

In the Healthy Heart Education Program, the analysis combines:

  • Quantitative data: costs, emergency department visits avoided
  • Qualitative data: staff and participant feedback explaining how education changed their behavior

Resources to Learn More

The Return on Investment (ROI) Calculator for Healthcare Partnerships to Address Social Needs
Website
Provides an interactive calculator to help users estimate the financial return of health-related social needs interventions and community health programs.
Organization: HealthBegins