Too Much Alarm (and Not Enough Cow) Bell

Since global health topics rarely make the newspapers, I read with interest an article in the Boston Globe recently that reported a “sharp email warning” to a Ugandan clinician to stop enrolling patients in his HIV/AIDS treatment program due to the US government’s concern that the treatment program costs too much (Globe article).  Unfortunately, the article did not place the warning and concern in the context of the changing US HIV/AIDS treatment programs and US global health aid in general.  The additional information may have helped readers appreciate the value of the US aid to its recipients and to the US and may have helped some of many readers who reacted negatively online overcome their ideological fixations.

The article’s focus was the President’s Emergency Plan for AIDS Relief (PEPFAR), and it is one of the largest, longest-running (7 years), and most bi-partisan of US aid programs and one of the most successful (e.g., enabling the life-saving treatment of more than 2.4 million [PEPFAR Results]).  I am clearly not proficient in this field but through a quick read of a few of the many sources of information (e.g., Avert PEPFAR Summary) I learned this recent history:  at the end of his term in 2008, President Bush, who first proposed the five-year program in 2003, signed into law the Lantos-Hyde Reauthorization Act (Lantos-Hyde Act) which funded PEPFAR and programs against tuberculosis and malaria and was supported (mostly) by both parties.  The Act set the programs’ budgets at $48 billion over 5 years and set specific goals for improving global health.  The Act reoriented PEPFAR so that it emphasizes a long-term rather than emergency response, increases involvement of the governments in the countries receiving the aid, expands prevention and treatment, and requires coordination with broader global health and development programs and evaluation of its efforts and outcomes (PEPFAR About).

As a tax-payer and global health aid advocate, I am interested in the costs and accountability of the program:  what money goes to what program, how effectiveness is determined, and how programs are reprioritized so that the utility of the (always) limited funds will maximized.  These are general concerns in the international aid community (c.f. my posting of January 7, 2010) but I found that, despite its prominence (and political ramifications), PEPFAR’s costs and effectiveness have been difficult to analyze.  As was noted in a report released in October 2007 by two advocacy groups,  HIV/AIDS Monitor and the Center for Global Development (Following the Funding for HIV/AIDS):

– “The resources for AIDS are a topic of considerable interest and debate internationally, yet little is understood about how these resources are actually being spent, and whether they are being made available as efficiently and effectively as possible for the fight against AIDS” (page vii);

– most of the PEPFAR funding goes to NGOs (at least 34 in each of the three countries in the report) and each NGO has its own multiple subcontractors (p. 14-15); and

– “Global AIDS advocates and country-level stakeholders often raise concerns about PEPFAR ROs’ [Recipient Organizations] overhead costs.  Such costs, however, are nearly impossible to estimate, both because the relevant data are not publicly available and because different recipients account for their expenses differently” (page 19).

More recently in late 2008, the Center for Global Development called for existing PEPFAR official data on obligations to prime partners, sub-partners, and program areas to be published to improve transparency and accountability (CGD Publication) and in February 2010, a coalition of global health advocacy and NGOs offered a critique of the Obama administration’s Global Health Initiative (of which PEPFAR is a part) as described in its “Consultation Document” (GHI).  They recommended that contractor overhead costs and over-priced and “ineffective technical assistance” be decreased and all contract information including amount of funding, targets and goals, and evaluations of success and limitations should be made publicly available online (Coalition Comments).  Although this degree of transparency does not seem to be in the current plans for PEPFAR, according to the Executive Branch’s report to Congress on PEPFAR last December (PEPFAR Report), the program’s work will be “systematically studied and analyzed to help inform public health and clinical practice” and public access to data will be increased.

A general picture of how the PEPFAR funds were spent and may be spent is provided by the UK-based AIDS charity, Avert, in a comprehensive summary based on 2007 information (Avert Funding Summary).  I can’t help noting that of the top “prime partners” (i.e., contractors) in 2007, three are universities and they received $185 million in total.  If these contracts carry the same overhead rate as US government research grants to universities (no one appears to know what the contractors rates are, e.g., as commented on by Laurie Garrett of the Council on Foreign Relations [CFR Comments]), then about 60% of each award goes into the recipient university’s general revenues and the remainder goes to contract implementation (which has its own overhead) before some fraction is eventually spent on improving health.  The average cost to treat an AIDS patient in Mozambique in 2007 was about $400 per year (DuBois 2009).  So if these universities cut their overhead rate by 50% (starting with reducing the salaries of their presidents, who in 2007-8 made an average of $436K at public universities and much more at the privates [Chronicle of Higher Ed article]), an additional 230,000 patients could have been treated in 2007.  Maybe the next Globe article on PEPFAR could address the efforts by its administrators to make it more cost-effective and sustainable and hopefully more transparent and accountable.  Ringing an alarm bell on global health stirs up readers but doesn’t do much for solving problems:  more cowbell (please).  My final word on cowbells is to recommend that every foreign aid program include a small amount of funding to evaluate the contractor’s performance (e.g., by the GAO), and where there are more that three contractors with similar or overlapping activities, eliminate the lower performing ones and redirect the funds to scaling up the better ones.  Has anyone heard of this being done?

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