A Plan for Essential Care

Back in November, I wrote about attending the inaugural symposium of the Center for Global Health of the Massachusetts General Hospital (MGH) and about my good impression of one of the speakers, Walter T. Gwenigale, former (pending reappointment) Minister of Health and Social Welfare of Liberia (my post of 11/18/10). Dr. Gwenigale spoke about the improvements to the country’s health care system:  increased annual per capita health spending from $3 to $29, increased physician salaries from $100 to $1000 per month to reverse the brain drain, institution of a national cap on health worker salaries to prevent the NGOs from recruiting them out of the public sector, and subsidization of health care workers who agree to work in rural areas.  In answer to a question, Dr. Gwenigale mentioned the country’s “health funding pool” through which all donors’ funds were administered with full accounting and transparency so that the funded activities, which are typically aimed at specific diseases like HIV/AIDS, polio, and malaria, are coordinated with government efforts to provide basic health services like pre- and ante-natal care and immunizations.

A health funding pool, I learned upon further investigation, is better know as  a “health sector wide approach” (or health SWAp) which is an approach developed in the late 1990s within the international aid community and was implemented in at least six African countries (Ghana, Malawi, Mozambique, Tanzania, Uganda and Zambia) in the early-mid 2000s.  A review of these SWAps by the UK’s Department for International Development (Walford 2007) found that SWAps had brought incrementally improved benefits (more spending in government programs and of more coherence of effort) but the “continuing plethora of funding mechanisms and succession of new initiatives” by donor organizations increased overall  costs (less efficiency) and “can undermine efforts to strengthen [national] systems.”  A more recent review by an advocacy group, the Advocacy to Control TB Internationally, and specific to World Bank-funded health SWAps was critical of their poor performance in treating TB (Aid Without Impact 2010) which was then rebutted by representatives of the Bank (World Bank Response) which was counter-rebutted.  Maybe the jury is still out on SWAps, but Dr. Gwenigale and Liberia’s approach got me wondering:  what is the cost of providing a basic set of health services?

Not surprisingly, international health aid groups like WHO and their many related organizations and consultants have addressed the question of what these services may be and have developed the concept of an “essential health package” or EHP.  According to a WHO draft brief (WHO Technical Brief 2008), EHPs “aim to concentrate scarce resources on interventions which provide the best ‘value for money’ (original emphasis).”  The starting point for a country’s ministry of health when designing its EHP seems to be the “burden of disease” in that country and the existing available interventions.  Hence, the aims of EHPs are typically to provide for:

  • reproductive and child health (e.g., obstetrics, family planning, immunization, nutritional deficiency)
  • communicable disease control (malaria, TB, HIV/AIDS/STD, epidemics)
  • non-communicable disease control (cardiovascular disease, diabetes, trauma, mental health)
  • other common conditions (eye, dental disease)
  • community health promotion and disease prevention (Tanzania Essential Health Package 2000).

Of course, embedded in the design and adoption of an EHP are many tough questions about its delivery from the number, type, staffing, and equipping of clinics and hospitals to the training of health care providers and many tough policy and resource questions.  But back to my simple question of cost.  Here are some numbers I found for the annual per capita cost of providing an EHP in various countries in non-adjusted US dollars:

Country Budgeted Cost Required Cost Source
Generic low income 16-32 WHO Technical Brief 2008
Liberia 29 Dr. Gwenigale above
Malawi 13.5 28 Bowie and Mwase 2011 


Malawi 16 DFID Study 2010
Tanzania 22 UN Millennium Project 2006
Uganda 8 28 Ssengooba 2004

For comparison but not necessarily equivalent to cost of EHP provision, the average per capita health care spend in 2009 in the 30 OCED (Organization for Economic Cooperation and Development) countries was $3000 with a range of $600 (Turkey) to a whopping $7300 (US) (OECD Statement to the US Senate).

As with the effectiveness of health SWAps, the effectiveness of an EHP approach is apparently still under study.  While the WHO ((WHO Technical Brief 2008) and the UN’s Millennium Project (UN Millennium Project 2006) provide guidance for determining cost-effectiveness and there seem to be many reports on the costs of specific programs by the academic health economists, I found only one study (and only in an abstract published this week) that provided some data.  Bowie and Mwase studied Malawi’s SWAp EHP delivery and found that 33 of the 55 EHP interventions were potentially cost-effective (<$150/DALY), 12 were not so cost-effective (>$150/DALY), and 10 had no data.  They also found that provision of nearly all EHP services had increased over the period of the SWAp and concluded “the identification of interventions of proven effectiveness and good value for money and earmarked funding through a SWAp process can produce measurable improvement in health service delivery at extremely low cost” (Bowie and Mwase 2011).

So how could the SWAp/EHP approach be fully funded?  Redirection of all aid money currently provided through contractors would free up some money.  For example, USAID spends annually about $5 billion on HIV/AIDS and malaria–specific (non SWAp) health care in Africa (Wikipedia USAID article), and if one assumes that about half of this money goes into direct aid (that is to buy the needed supplies and pay the people who are doing the delivery) and about half is going into overheard (it may be a lot higher; although overhead costs are considered to be propriety contact information by most donors, I noted that the recent USAID Project SEARCH (Supporting Evaluation and Research to Combat HIV/AIDS) “Indefinite Quantity Contract” has five prime contractors (Boston University, Family Health International, Futures Group International, Johns Hopkins University, and Population Council) who may add on to direct costs the following overhead costs:  32–35 percent of direct labor costs for fringe benefits, 45–60 percent of applied to labor and fringe for “Overhead,” 7–15 percent of total costs for administration, and a 6–9 percent “fee” [SEARCH FAQs]), then a redirection into SWAps would yield an additional $2.5 billion for EHP provision, or enough basic health care for 90 million people using an estimated cost of $28 per capita.  Although a good start, redirection of this USAID money alone would only cover about 8% of sub-Saharan Africa’s 1.1 billion people, so I would have to persuade the other international, sector-specific donors redirect and cut their transaction costs (I am guessing other donor-directed spending in Africa is about $3 billion).  Or, if we Americans could get by spending 1% less on our health care, that would generate about $20 billion to cover 720 million people.  That sounds like I need to write to my Congress persons.


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