The major aims of this research is to develop a method fordetermining the costs incurred by patients and accompanyingrelatives when the former consume leprosy care at outstations,that is at a service points outside their district of residence.The secondary purpose is to actually determine the costs incurredby patients and accompanying relatives and the saving which couldbe achieved if they were to consume care at a local clinic. The principles of decision tree are used to explore thealternative actions of patients in receiving services at variouslevels of leprosy clinics. The complexity of actions wereacknowledged and defined for costing purposes. To develop methodsfor determining costs a mathematical

cost model is formulated.The model is used to estimate cost incurred by patients andrelatives attending local and outstation clinics based uponparameters determined for 30 patients at each of the threesampled clinics (Total of 90 patients). The cost studied are thenused to estimate the potential cost saving which could beachieved if they were to consume care at local clinics. The study shows that the costs incurred by patientsreceiving services at local and outstation clinics are 489Ru/patient/year and 54/person/visit for patients at local clinicsand 3166 Ru/patient/ year and 352 Ru/person/visit at outstationclinics. The cost incurred by relatives accompanying patients tolocal and outstation clinics are 17.4 Ru/person/visit and 193Ru/person/visit respectively. The average total costs in attending outstation clinics are7.6 times that for attending local clinics. The highestcomponents of costs are travel costs and time costs in seekingcare at outstation clinics. An estimated aggregate figure for the annual cost savingwhich could be achieved if all leprosy patients in Nepal attendedlocal clinics is 20x10('6)Ru. This cost does not include theopportunity cost, income loss due to late detection anddeformity, which is estimated to be 297x10('6) Ru/annum. The study concluded that more investment in leprosyservices for early case detection and treatment may be worthconsidering to reduce costs to patients and to the community.