Economics: Costs, Cost-Effectiveness, and Benefits of HIV Treatment and Prevention

In the early years of the global rollout of HIV prevention interventions and antiretroviral treatment (ART) for HIV/AIDS, little attention was paid to the cost of the programs, the cost-effectiveness of different models of service delivery, or the value of the benefits generated.  As national programs expanded and resources became scarcer, however, an urgent need for accurate, up-to-date data on the costs of care and prevention, for different populations and in different settings, arose.  With it came demand for analyses of the cost-effectiveness of alternative approaches to providing services and, to a lesser extent, interest in measuring the benefits of the services.

Starting in 2005, CGHD researchers have been collecting and analyzing primary, patient-level data to estimate the costs, cost-effectiveness, and benefits of ART for adults and children in a range of countries and settings.  Since then, results have been published of the cost of treatment per patient served, cost-effectiveness of different adult and pediatric treatment delivery models and drug regimens, and anticipated costs of changing treatment guidelines and numbers of patients served. This work has helped program managers and policy makers to understand the current costs of treatment, evaluate the economic implications of proposed treatment guideline changes, and identify areas for potential savings.

  • Costs and Outcomes of HIV Treatment:  When CGHD began its work on the economics of HIV in sub-Saharan Africa, few estimates were available of simple parameters such as the average cost of ART per patient treated.  CGHD developed a methodology and model for using retrospective cohort data from local clinics and hospitals to estimate costs.  When information about the outcomes of treatment was combined with these cost estimates, the results indicated the cost per patient retained in care and responding successfully to treatment—a “production cost” for HIV treatment.  This approach has been applied to estimate treatment costs in South Africa, Zambia, Kenya, and Uganda, and for both adults and children.  It has also been expanded to allow cost-effectiveness comparisons among different models of service delivery—such as ART managed by doctors at hospitals v. nurses at clinics—and between different antiretroviral drugs, such as tenofovir and stavudine.
  • Costs of HIV Prevention:  Although HIV prevention has not been a major area of research for CGHD’s health economics team, studies have been undertaken to estimate the costs of prevention of mother to child transmission (PMTCT) in Zambia and Kenya and of delivery of safe male circumcision in Uganda.
  • Economic Outcomes of Treatment:  By 2011, some 7.5 million people in sub-Saharan Africa were receiving antiretroviral therapy for HIV/AIDS.  Within a few years, nearly 10% of working aged adults in South Africa will be on ART.  Beginning in 2005, CGHD set out to assess the impact of treatment on patients’ economic activities, work productivity, quality of life, and other non-biomedical outcomes.  Research has included a six-year prospective cohort study of adult patients in South Africa and a detailed analysis of the labor productivity of agricultural workers on ART in Kenya.
  • Economics of Tuberculosis:  Africa’s HIV epidemic has led to a parallel epidemic of tuberculosis and drug-resistant tuberculosis.  Among the countries hardest hit is South Africa, where TB incidence is among the highest in the world and more than ten thousand cases of multidrug-resistant TB (MDR-TB) were diagnosed in 2012.  CGHD’s work in this area is conducted in collaboration with HE2RO and focuses on the costs of treating and diagnosing TB and MDR-TB.  Accomplishments include the development of the National TB Cost Model, used by the South African National Department of Health to estimate the costs of scaling up Xpert MTB/RIF diagnostic technologies country-wide.
  • Modelling Future Costs:  In 2009, the South African Department of Health and National Treasury asked a joint CGHD/HE2RO  team to model the future size and costs of the national treatment effort. CGHD researchers built a model to estimate the annual expected costs of the program between 2010 and 2017 and evaluate proposed changes to treatment guidelines.  The National ART Cost Model continues to be used to advise the South African Government on the expected costs of its treatment program, with additional modeling undertaken to understand the cost implications of treatment as prevention.
  • AIDS and the Private Sector:  As evidence of very high HIV infection rates among working-aged adults in sub-Saharan Africa accumulated in the late 1990s, concern mounted that employers, and in particular private companies participating in competitive export markets, would lose large numbers of skilled workers and face greatly increased labor costs. Among the CGHD’s earliest work on HIV/AIDS was a series of studies on the costs of HIV to private companies and government agencies in various African countries, including South Africa, Botswana, Zambia, Kenya, and Uganda. Most of this research pre-dated large-scale access to effective treatment for HIV/AIDS and examined the likely impact of the disease on employers and economies in the absence of treatment.
  • USAID South Africa
  • CDC Zambia
  • Walter Reed Army Institute of Research
  • National Institutes of Health


Costs and Outcomes of HIV Treatment

Economic Outcomes of Treatment

Economics of Tuberculosis

  • Diagnosing Xpert MTB/RIF negative TB: impact and cost of alternative algorithms for South Africa. Schnippel K, Meyer-Rath G, Long L, Stevens W, Sanne I, Rosen S. S Afr Med J 2013: 103;101-106.

Modeling Future Costs

AIDS and the Private Sector

  • AIDS is Your Business. Rosen S., Simon J., Vincent J. R., MacLeod W., Fox M., Thea D. M. Harv Bus Rev. 2003 Feb; 81(2):80-7, 125.