OBJECTIVES: The primary aims of SCAP in Australia are to: contribute to the establishment of a schizophrenia outcomes database; evaluate which model of health care results in better clinical outcomes and quality of life in a naturalistic setting and; evaluate the cost of health care for patients with schizophrenia. Emphasis is given to measuring the utilisation of mental health care services. METHODS: SCAP is a prospective, naturalistic, non randomised 3 year follow-up study of 350 patients, with a diagnosis of schizophrenia, schizoaffective disorder or schizophreniform disorder. Data on utilisation of health care resources and costs involved in the treatment of schizophrenia will be obtained from patient records and from a number of state and federal databases. These cover all health care services used: in hospital and out of hospital; medications and community services. The initial findings based on 6 month data for the first 50 subjects were used for a pilot study. RESULTS: The average direct medical care cost of treating patients over the period was calculated at A$5,500. Hospitalisations accounted for 85% of the costs. Medications used whilst the patient was in the community care accounted for only 2.5% of the total costs. Ten percent of the patients utilised over 30% of the treatment resources. CONCLUSIONS: A full clinical costing could be undertaken by linking data from a range of payments and activity data sets in Australia. SCAP will provide unique data on the social and economic cost of schizophrenia. SCAP is unique because it provides the opportunity to simultaneously explore a broad range of schizophrenia research questions in a variety of settings across time. Further the SCAP results will be drawn from a naturalistic setting and this will enhance the generalisability of the results.