February 2002 Insights
Health Issue #2
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Economies of scale-up?
The cost of expanding access
The Commission
on Macroeconomics and Health was established in January 2000 under the
direction of the WHO Director-General. It is examining interrelations
between investment in health, economic growth and poverty reduction.
As part of the background analysis, researchers investigated the likely
costs of scaling-up antiretroviral (ARV) treatment for HIV/AIDS.
The cost analysis
included all countries in sub-Saharan Africa and every nation with a
per capita GNP below $1200. Three major variables influenced the costs:
- the population
in need
- change in coverage
- unit costs.
They also calculated
additional infrastructure costs related to providing a package of care
for HIV, including investment in health facilities and recruitment and
training of new personnel.
It is estimated
that less than one percent of all people currently living with HIV/AIDS
and with access to health services receive ARVs. The researchers built
costs on a baseline extrapolated from current available data for 2002
to produce three scenarios reflecting different coverage levels:
2007A - conservative
estimates based on scaling-up within existing health system capacities
to deliver ARVs to ten percent of patients with access to health services
by 2007
2007B - cost estimates assuming substantial investment in current
health systems to increase coverage to 45 percent of this group by 2007
2015 - costs consistent with long-term investments in delivery
and infrastructure to provide ARV treatment for 65 percent of people
living with HIV/AIDS by 2015.
As the table shows,
the estimated total annual amount that would be required from 2002 to
scale-up ARV treatment to these three levels would be US$ 0.8-1.2 billion,
4.2-5.8 billion and 6.8-9.2 billion, respectively. This analysis assumed
that ARVs would only be delivered in the context of strengthened clinical
management of HIV-related illnesses. An additional US$ 6.8-7.1 billion
would be required annually to provide this for 70 percent of patients
by 2015.
The researchers
considered both the drug and infrastructure costs that are required
to deliver ARVs. Even if drug prices fall significantly, the financial
barriers to implementing ARV are still almost insurmountable for the
vast majority of low and middle-income countries, without substantial
international support.
Lilani
Kumaranayake
Department of Public Health and Policy
London School of Hygiene and Tropical Medicine
Keppel Street
London WC1E 7HT
UK
T: +44 (0)20 7927
2412
F: +44 (0)20 7637 5391
lilani.kumaranayake@lshtm.ac.uk
See also
"Costs of scaling-up priority health interventions in low and selected
middle income countries: methodology and estimates" by L.Kumaranayake,
C.Kurowski and L.Conteh, Commission for Macroeconomics and Health, Working
Group Five Discussion Paper No.19 (2001)
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