South Africa’s HIV epidemic has enormous social and economic consequences.  Providing hospital care for HIV patients is very expensive for the health system and costs are expected to rise. HIV accounts for 24 percent of all hospital admissions and 12.5 percent of the total public health budget. 

Highly Active Anti-Retroviral Therapy (HAART) has been shown to be cost-effective in reducing deaths and sickness from HIV in developed countries. It has enabled many people with HIV to be treated on an outpatient basis, avoiding the need for hospital admission.

Until recently it was thought that the South African government was unable to afford to provide HAART. However, the costs of the anti-retroviral (ART) drugs for developing countries have been reduced in recent years and the South African government has announced a commitment to providing ART through the public health service. The government has awarded contracts to international companies to supply the drugs to health facilities throughout the country. These contracts are anticipated to drive down the price of ART further. 

Researchers assessed the cost-effectiveness of HAART for the South African health service, by comparing the use and costs of HIV-related health services by people who were receiving HAART with that of patients who were not receiving ART (the control group). Two scenarios for HAART prices were used: scenario one used current South African public-sector ART drug prices of US$730 per patient year (PPY), whereas scenario two was based on the anticipated public sector price for locally manufactured drugs of US$181 PPY. The study was conducted in Cape Town between January 1995 and December 2000 with 265 HIV-infected adults and 27 with AIDS (HIV stage four) in each group. 

The following findings were reported:

• The disease progressed more slowly in the HAART group than in the control group.
• HAART patients had significantly fewer inpatient days than those not receiving ART, but had significantly more outpatient days.
• The average cost PPY of inpatient services for patients in the HAART group was significantly less than for the control group, while the corresponding average cost of outpatient visits PPY was not significant.
• Treatment with HAART for people with AIDS was cheaper for both price scenarios.
• For patients with HIV but not AIDS, HAART was cheaper under the second price scenario.
• For both ART and non-ART groups, use of inpatient services increased with increased severity of the infection.

The study shows that HAART slows disease progression and reduces dependence on inpatient services, resulting in significant health benefits and cost reductions.

Policy implications include:

• The costs under the two price scenarios show that introducing HAART would be highly cost-effective in Cape Town.
• The study included only the direct costs of treatment, and not the indirect cost of illness. If indirect costs, such as lost workdays or quality of life, were included in the analysis, HAART would prove to be even more cost-effective.
• In addition to the benefits for HIV patients, a national HAART programme would reduce HIV-related demand for hospital services. This would generate savings on expenditure and/or release resources for use elsewhere in the health system. 

Source(s):
‘Cost-effectiveness of highly active antiretroviral therapy in South Africa’, PLOS Medicine 3(1), by Motasim Badri, Gary Maartens, Sundhiya Mandaliya, Linda-Gael Bekker, John R. Penrod, Robert W. Platt, Robin Wood and Eduard J. Beck, January 2006 Full document.
When to initiate highly active antiretroviral therapy in sub-Saharan Africa? A South African cost-effectiveness study', Antiviral Therapy 11(1), pages 63-72, by Motasim Badri, Susan Cleary, Gary Maartens, Jennifer Pitt, Linda-Gail Bekker, Catherine Orrell and Robin Wood, 2006 (in press)

Funded by: Secure the Future, Bristol-Myers Squibb

id21 Research Highlight: 21 July 2006

Further Information:
Motasim Badri
Department of Medicine
Desmond Tutu HIV Centre
University of Cape Town
Cape Town
South Africa

Tel: +27 21 6506957
Fax: +27 21 6506963
Contact the contributor: motasim.badri@hiv-research.org.za

The Desmond Tutu HIV Centre, Institute of Infectious Disease and Molecular Medicine, University of Cape Town, South Africa

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