Background: The causal impact method (CIM) was recently introduced for evaluation of binary interventions using observational time-series data. The CIM is appealing for practical use as it can adjust for temporal trends and account for the potential of unobserved confounding. However, the method was initially developed for applications involving large datasets and hence its potential in small epidemiological studies is still unclear. Further, the effects that measurement error can have on the performance of the CIM have not been studied yet. Methods: Motivated by an existing dataset of HCV surveillance in the UK, we perform simulation experiments to investigate the effect of several characteristics of the data on the performance of the CIM. Further, we quantify the effects of measurement error on the performance of the CIM and extend the method to deal with this problem. Results: We identify multiple characteristics of the data that affect the ability of the CIM to detect an intervention effect including the length of time-series, the variability of the outcome and the degree of correlation between the outcome of the treated unit and the outcomes of controls. We show that measurement error can introduce biases in the estimated intervention effects and heavily reduce the power of the CIM. Using an extended CIM, some of these adverse effects can be mitigated. Conclusions: The CIM can provide satisfactory power in public health interventions. The method may provide misleading results in the presence of measurement error.