Experience with Experience with Costing Costing

HIV/AIDS HIV/AIDS StrategiesStrategies

René BonnelRené Bonnel

Global HIV/AIDS Program, World Global HIV/AIDS Program, World BankBank

June 2007June 2007

Why AIDS StrategiesWhy AIDS Strategies?? To respond to the heterogeneity of To respond to the heterogeneity of

epidemicsepidemics Much more diverse than previously thoughtMuch more diverse than previously thought Ensure that there is a match between the Ensure that there is a match between the

epidemics and the AIDS responseepidemics and the AIDS response To align external support with national To align external support with national

prioritiespriorities To implement the “Three Ones” Principles:To implement the “Three Ones” Principles:

One national authorityOne national authority One agreed frameworkOne agreed framework One monitoring and evaluation systemOne monitoring and evaluation system

Evolution of AIDS Evolution of AIDS StrategiesStrategies

From:A broad generic vision

and framework

A country-specific BUT

incomplete & under-funded framework

TO

Features of current AIDS Features of current AIDS FrameworksFrameworks

Strengths Strengths WeaknessesWeaknessesForging high level of Forging high level of commitmentcommitment

Provides medium to Provides medium to long-term vision of long-term vision of programsprograms

Not based on evidence and Not based on evidence and transmission patterns of transmission patterns of infectionsinfections

Includes broad range Includes broad range of activitiesof activities

Limited prioritizationLimited prioritizationNot translated into annual Not translated into annual action plans with clear budgets action plans with clear budgets and indicatorsand indicators

Focus on Focus on multisectoral multisectoral responseresponse

Limited monitoring and Limited monitoring and evaluation beyond health evaluation beyond health interventionsinterventions

Why do we need costing?Why do we need costing? Inform the formulation of programs and priorities: Inform the formulation of programs and priorities:

Selected interventions must be ambitious, but they Selected interventions must be ambitious, but they must be affordable must be affordable

Help ensure that the programs can be Help ensure that the programs can be implemented:implemented:

The cost of the AIDS response has to be included in The cost of the AIDS response has to be included in the national budget and Medium-Term Expenditure the national budget and Medium-Term Expenditure FrameworkFramework

Why? Because some expenditures can only be Why? Because some expenditures can only be financed by governments (donors won’t)financed by governments (donors won’t)

Help mobilize resources from international donorsHelp mobilize resources from international donors Costing has to take place along with an estimation of Costing has to take place along with an estimation of

available resourcesavailable resources

Costing and planning Costing and planning process process

In theory selection of key programs In theory selection of key programs and priorities should precede costingand priorities should precede costing

In practice, planning, prioritizing and In practice, planning, prioritizing and costing are often interrelated and take costing are often interrelated and take place as an iterative processplace as an iterative process

Starting point is to define the Starting point is to define the key key resultsresults that are generated by programs that are generated by programs

Formulate/ReviseHIV/AIDS Strategy

Define Key Interventions

and cost Them

Identify key results to aim for

Select strategic programs

HIV/AIDS STRATEGY RESULTS CYCLE

Estimate funding gap

Specify Annual Work Plans with M & E and costs

Reassess programs and coverage of interventions if needed

Key steps for costingKey steps for costing

Know your epidemic: having an Know your epidemic: having an evidence-informed strategy helps!evidence-informed strategy helps!

Set priorities among activities to be Set priorities among activities to be costedcosted

Define key target groups and coverage Define key target groups and coverage of interventionsof interventions

Cost activitiesCost activities Estimate funding gapEstimate funding gap Utilize data to inform policy choicesUtilize data to inform policy choices

Figure 6. Source: Analysis and Advocacy (A2) Thailand Team, Pattaya presentation to ASAP meeting, January 2006.

Know your epidemic: Know your epidemic: ThailandThailand

HIV Prevalence and HIV Prevalence and Transmission Sources Transmission Sources in One in One

East Asian CountryEast Asian Country Country is experiencing a concentrated epidemic Country is experiencing a concentrated epidemic

with exceptional vulnerability among marginalized with exceptional vulnerability among marginalized populations:populations: HIV infection in the general population remains low HIV infection in the general population remains low

(0,3% of pregnant women)(0,3% of pregnant women) Rates among IDUS: 80% in the largest city and rates of Rates among IDUS: 80% in the largest city and rates of

30% among sex workers in selected sites30% among sex workers in selected sites Epidemiological analyses indicate that injecting drug Epidemiological analyses indicate that injecting drug

uses contributes perhaps 3/4 of HIV infections, and uses contributes perhaps 3/4 of HIV infections, and IDUs and sex workers together account for more than IDUs and sex workers together account for more than 90% of infections90% of infections

But interventions to protect IDUs and sex workers But interventions to protect IDUs and sex workers are just one of the country’s nine major strategic are just one of the country’s nine major strategic prioritiespriorities

Principle 2: Set priorities for Principle 2: Set priorities for costing activitiescosting activities

Necessary process: Necessary process: Example: Swaziland has a small population but Example: Swaziland has a small population but

Strategy includes 910 individual activities. To Strategy includes 910 individual activities. To cost all of them would be quite time consumingcost all of them would be quite time consuming

Rank activities based on explicit criteria. In Rank activities based on explicit criteria. In the case of Swaziland, the following were the case of Swaziland, the following were used: used: Is the activity evidence-based and is it likely to Is the activity evidence-based and is it likely to

have an immediate impact on the epidemic?have an immediate impact on the epidemic? Does the country have the capacity to implement Does the country have the capacity to implement

the activity?the activity? Can the activity be funded (i.e. does the country Can the activity be funded (i.e. does the country

have or could it get the resources?)have or could it get the resources?) Result was a list of 24 priority objectives to be Result was a list of 24 priority objectives to be

addressed through 35 priority strategiesaddressed through 35 priority strategies

Principle 2.Principle 2. Identify key Identify key target groupstarget groups

Key target groups are the beneficiaries of Key target groups are the beneficiaries of interventions included in programsinterventions included in programs

How to identify these groups? How to identify these groups? Likely to be the most-at-risk groups and the most Likely to be the most-at-risk groups and the most

vulnerablevulnerable They should matter for the course of the epidemicThey should matter for the course of the epidemic

Why identify these groups?Why identify these groups? Objective is not to stigmatize these groups, Objective is not to stigmatize these groups,

but to cost interventions that reach these but to cost interventions that reach these beneficiariesbeneficiaries

Principle 3. Set coverage Principle 3. Set coverage targets that are ambitious targets that are ambitious

and realisticand realistic Principle: reach universal accessPrinciple: reach universal access In practice, need to define targets In practice, need to define targets

for coverage based on the stage of for coverage based on the stage of the epidemicthe epidemic Coverage rates vary with the stage of Coverage rates vary with the stage of

the epidemic (low-level, concentrated, the epidemic (low-level, concentrated, generalized and hyperendemic).generalized and hyperendemic).

These stages have implications for the These stages have implications for the programming of interventionsprogramming of interventions

Implications for Implications for programmingprogramming

Low-Low-LevelLevel

epidemiepidemicc

High priority interventionsHigh priority interventions

Low Low levellevel: :

HIV HIV <1%<1%

Collect basic information about the most Collect basic information about the most vulnerable and most at risk groups vulnerable and most at risk groups (establish (establish surveillance systemssurveillance systems))Implement Implement programs for and with most-programs for and with most-at- risk groupsat- risk groups on a sufficient scale; build on a sufficient scale; build capacity of the most-at risk populations to capacity of the most-at risk populations to deliver peer interventionsdeliver peer interventionsProvide Provide access to servicesaccess to services for people for people living with HIVliving with HIVCombat Combat stigma and discriminationstigma and discriminationProvide a Provide a clear mandate for leadershipclear mandate for leadership, , resource mobilization, coordination and resource mobilization, coordination and reporting to the National AIDS Authorityreporting to the National AIDS Authority

Source: Practical Guidelines for Intensifying HIV Prevention. UNAIDS 2007.

Implications for Implications for programming (Cont.)programming (Cont.)

ConcentrateConcentrated epidemicd epidemic

High priority interventionsHigh priority interventions

Future course of Future course of the epidemic is the epidemic is determined by determined by the size of the the size of the vulnerable vulnerable populations, the populations, the frequency and frequency and nature of links nature of links between the between the subgroups and subgroups and the general the general population, and population, and the degree to the degree to which the needs which the needs of the affected of the affected and most-at-risk and most-at-risk groups are met.groups are met.

Fund Fund second generation surveillancesecond generation surveillance including elements that focus on the including elements that focus on the intersections of groups with different risk intersections of groups with different risk (e.g. behavioral surveillance in (e.g. behavioral surveillance in subpopulations with risk behavior and in subpopulations with risk behavior and in bridging groups) bridging groups) Provide and promote Provide and promote voluntary HIV testing voluntary HIV testing and counseling with referral to servicesand counseling with referral to servicesProvide Provide comprehensive prevention and care comprehensive prevention and care programs to vulnerable groups and the programs to vulnerable groups and the “bridge” groups“bridge” groups such as mobile populations, such as mobile populations, uniformed forces, clients of sex workers, and uniformed forces, clients of sex workers, and most-at-risk young people most-at-risk young people Combat stigma and discriminationCombat stigma and discrimination. Train . Train and support national leaders to speak out and support national leaders to speak out against HIV stigma and discriminationagainst HIV stigma and discrimination

Principle 4: Cost key Principle 4: Cost key activitiesactivities

Cost activities that matter for the stage of the Cost activities that matter for the stage of the epidemicepidemic

Determine appropriate chart of accountsDetermine appropriate chart of accounts Determine standard costs by account categories Determine standard costs by account categories

to harmonize costingto harmonize costing Focus on key activities that are usually Focus on key activities that are usually notnot

costed (fully funded) in low level and costed (fully funded) in low level and concentrated epidemics:concentrated epidemics:

Establishment of an appropriate surveillance Establishment of an appropriate surveillance system to address the lack of datasystem to address the lack of data

Building of capacity for HIV prevention planning Building of capacity for HIV prevention planning and implementation in local governments, and civil and implementation in local governments, and civil societysociety

ResourcesResources

New model being developed: Activity Based New model being developed: Activity Based Costing ModelCosting Model Key elements of existing models (concepts of Key elements of existing models (concepts of

target groups and coverage levels from the target groups and coverage levels from the Resource Needs Model)Resource Needs Model)

But adds new features: But adds new features: Functional classification of expenditures from NASA Functional classification of expenditures from NASA

(National AIDS Spending Assessments)(National AIDS Spending Assessments) Cost individual activities with level of detail up to the userCost individual activities with level of detail up to the user Allows mapping of expenditure types to government Allows mapping of expenditure types to government

accounting frameworkaccounting framework For more information: www.worldbank.org/asapFor more information: www.worldbank.org/asap

Issues EncounteredIssues Encountered

Due to complexity of costing chart of Due to complexity of costing chart of accounts, implementing agencies may accounts, implementing agencies may have difficulties understanding how the have difficulties understanding how the cost of their program was arrived atcost of their program was arrived at

Local level budgeting tends to create Local level budgeting tends to create figures that are different from those figures that are different from those generated centrally, creating confusiongenerated centrally, creating confusion

Possible solution: agree on some Possible solution: agree on some standardized unit coststandardized unit cost

How to address How to address constraintsconstraints??

Principle: Bottlenecks are made to Principle: Bottlenecks are made to be brokenbe broken

Strategies should indicate how Strategies should indicate how bottlenecks would be brokenbottlenecks would be broken

Key bottlenecks include absorptive Key bottlenecks include absorptive capacity, but this has different capacity, but this has different meaningmeaning

Absorptive constraintsAbsorptive constraints

MacroeconomicMacroeconomic Debt sustainabilityDebt sustainabilityDutch disease effectsDutch disease effects

Human & Human & physical capitalphysical capital

Technical and managerial skills Technical and managerial skills of officialsof officialsLack of adequate Lack of adequate infrastructure and equipmentinfrastructure and equipment

Institutional and Institutional and policypolicy

Perverse incentives due to Perverse incentives due to recruitment systemsrecruitment systemsInadequate Public Expenditure Inadequate Public Expenditure ManagementManagement

Demand Demand constraintconstraint

Insufficient income to pay for Insufficient income to pay for servicesservicesSocial/cultural factorsSocial/cultural factors

Principle 5: Estimate Principle 5: Estimate funding gapfunding gap

Strategies need to be Strategies need to be realisticrealistic to to provide the basis for an provide the basis for an operational framework to operational framework to implement PRSPsimplement PRSPs

But they need to be inspirational But they need to be inspirational to attract donor fundingto attract donor funding

How to reconcile the two: run How to reconcile the two: run different scenarios for fundingdifferent scenarios for funding

Principle 6: Utilize Data to Principle 6: Utilize Data to Inform Policy ChoicesInform Policy Choices

Does the AIDS response match the epidemic?Does the AIDS response match the epidemic? Example: Latin America; key role of most-at-Example: Latin America; key role of most-at-

risk groups in the epidemics risk groups in the epidemics Homosexual-bisexual: Andean Region (48%),

Mexico (55%), North America (50%) Heterosexual, bisexual-homosexual: Brasil:(35%) Heterosexual : Central America (79%), Latin

Caribbean, (76%), Caribbean (80%) Homosexual-bisexual, IDUs Southern Cone (34%)

But often mismatch with allocation of But often mismatch with allocation of resourcesresources Generally per capita spending on IDUs is the Generally per capita spending on IDUs is the

smallest smallest Exceptions: Brazil, Argentina and SalvadorExceptions: Brazil, Argentina and Salvador

Prevention Spending per capita and Prevention Spending per capita and Transmission Sources in Selected Transmission Sources in Selected Latin American Countries (2002)Latin American Countries (2002)

0

2

4

6

8

10

12

14

16

18

Pe

r c

ap

ita

Sp

en

din

g (

US

$)

Mexico Panama Paraguay Peru DominicanRep

Uruguay

Sex Workers MSM Injecting Drug Users

Prevention Spending per capita and Prevention Spending per capita and Transmission Sources in Selected Transmission Sources in Selected Latin American Countries (2002)Latin American Countries (2002)

0

2

4

6

8

10

12

14

Pe

r c

ap

ita

sp

en

din

g (

US

$)

Argentina Bolivia Brazil Chile CostaRica

ElSalvador

Guatemala

Sex Workers MSM Injecting Drug Users

What Role for UNDP?What Role for UNDP? Advocacy and awareness raising:Advocacy and awareness raising:

Community awareness programs to ensure Community awareness programs to ensure involvement of the target communitiesinvolvement of the target communities

Carrying out scenario analysis of funding Carrying out scenario analysis of funding and costs targeting Ministry of Finance. and costs targeting Ministry of Finance. Choice being “pay now or much more later”Choice being “pay now or much more later”

Promoting a multi-sectoral response:Promoting a multi-sectoral response: Particularly with law enforcement agencies Particularly with law enforcement agencies

and social welfare)and social welfare) Rapid Assessment Results:Rapid Assessment Results:

Local assessments of results for local Local assessments of results for local advocacy and to build support for advocacy and to build support for community-based programscommunity-based programs

Sharing international best practicesSharing international best practices

Realism vs. Ambition: A few Realism vs. Ambition: A few LessonsLessons

Perfection is the enemy, and it is often Perfection is the enemy, and it is often counterproductivecounterproductive

On one hand: desire to be “correct” in costing as On one hand: desire to be “correct” in costing as much interventions as possible, but risk of having much interventions as possible, but risk of having costing models that are too complex costing models that are too complex

On other hand: desire to have simple models, but On other hand: desire to have simple models, but risk to be so simple that they don’t answer any risk to be so simple that they don’t answer any policy questionspolicy questions

What matters: What matters: this is a processthis is a process. Even if the . Even if the quality does not meet the highest standards, quality does not meet the highest standards, view it as a process to build capacity in the view it as a process to build capacity in the countrycountry