Development Assistance for Health during Economic Crisis


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  • Average cost of drugs—64% reduction in prices; if all drug companies started to value their drugs in a similar manner, our estimates of in-kind DAH would be greatly reduced.
  • Development Assistance for Health during Economic Crisis

    1. 1. Financing Global Health 2010: Tracking development assistance for health in economic uncertainty January 31, 2011 Christopher Murray Director, IHME
    2. 2. Outline <ul><li>Why Track Development Assistance for Health? </li></ul><ul><li>Financing Global Health 2010 Methods </li></ul><ul><li>Key Findings on DAH </li></ul><ul><li>Recipient Government Responses </li></ul><ul><li>What is Coming in 2011? </li></ul>
    3. 3. IHME Tries to Inform Three Questions <ul><li>What are people’s health problems? – e.g. tracking adult, child, or maternal mortality; the Global Burden of Disease 2010 </li></ul><ul><li>How well is a society doing in addressing these health problems? – e.g. inputs , outputs and outcomes from public health, medical care and other key social determinants </li></ul><ul><li>What can be done in the future to maximize health improvement? – e.g. cost-effectiveness of major intervention and health system intervention options </li></ul>
    4. 4. Tracking Health Financing <ul><li>Financing Global Health 2009 tracked Development Assistance for Health – flows from key development focused organizations for the advancement of global health. </li></ul><ul><li>Financing Global Health 2010 tracks Development Assistance for Health and government health expenditures. </li></ul><ul><li>Working on a systematic analysis of all available sources of data on out-of-pocket household expenditures on health 1990-2010. </li></ul><ul><li>Future editions of FGH will eventually include all three components: DAH, government, and private expenditures on health. </li></ul>
    5. 5. Outline <ul><li>Why Track Development Assistance for Health? </li></ul><ul><li>Financing Global Health 2010 Methods </li></ul><ul><li>Key Findings on DAH </li></ul><ul><li>Recipient Government Responses </li></ul><ul><li>What is Coming in 2011? </li></ul>
    6. 6. Channels of Development Assistance for Health
    7. 7. NGO Revision for In-Kind Revenue <ul><li>US NGOs claim drug and equipment donations at US wholesale prices while the donors claim at production costs. </li></ul><ul><li>Analyzed US retail, US wholesale, Federal Upper Limit, and drug indicator guide for 386 unique products. </li></ul><ul><li>We have estimated empirically this relationship and deflated all donations to all NGOs by the same average factor, 82%. </li></ul><ul><li>NGO-specific deflators have not been possible to develop. </li></ul>
    8. 8. Preliminary Estimates for Donors and Agencies <ul><li>In Financing Global Health 2009 and in The Lancet results on financing global health through 2007 reflecting the lag in audited financial statements. </li></ul><ul><li>Using audited financial statements and tax returns we have data for 2008. </li></ul><ul><li>We developed preliminary estimates for 2009 and 2010 by analyzing the historical relationship between budgets for donors and agencies and disbursements. Relationships are very strong and provide a reasonable basis for mapping from budgets to estimated disbursements. </li></ul><ul><li>Preliminary estimates for non-US government NGO revenue are the most uncertain. </li></ul>
    9. 9. Outline <ul><li>Why Track Development Assistance for Health? </li></ul><ul><li>Financing Global Health 2010 Methods </li></ul><ul><li>Key Findings on DAH </li></ul><ul><li>Recipient Government Responses </li></ul><ul><li>What is Coming in 2011? </li></ul>
    10. 10. DAH by Channel of Assistance, 1990-2010
    11. 11. DAH by country of origin, 1990-2010
    12. 12. Public sector DAH by donor country received by channels of assistance, 2008
    13. 13. Total overseas health expenditures channeled through US NGOs by funding source, 1990-2010
    14. 14. Fund balances for UN health agencies at end of 2009
    15. 15. Top 30 country recipients of DAH, 2003-2008, compared with top 30 countries by all-cause burden of disease, 2004
    16. 16. Total DAH per all-cause DALY, 2003-2008
    17. 17. DAH for HIV/AIDS by channel of assistance, 1990-2008
    18. 18. DAH for maternal, newborn, and child health by channel of assistance, 1990-2008
    19. 19. Outline <ul><li>Why Track Development Assistance for Health? </li></ul><ul><li>Financing Global Health 2010 Methods </li></ul><ul><li>Key Findings on DAH </li></ul><ul><li>Recipient Government Responses </li></ul><ul><li>What is Coming in 2011? </li></ul>
    20. 20. Domestic Financing of Health by Governments Has Been Increasing
    21. 21. What Happens to Domestic Finance in Countries that Receive Large Amounts of DAH? <ul><li>April 2010, published in The Lancet , our analysis of how Ministries of Finance respond when governments receive DAH. </li></ul><ul><li>Responses vary substantially, but on average, MoFs decrease health expenditures from their own sources by 43 cents to $1.14 for every dollar of DAH received by governments. </li></ul><ul><li>Debate is not on whether this occurs but whether it is welfare enhancing or not. </li></ul><ul><li>Perspectives vary widely between macro-economists and health specialists and between donors, Ministries of Health and Ministries of Finance. </li></ul>
    22. 22. Outline <ul><li>Why Track Development Assistance for Health? </li></ul><ul><li>Financing Global Health 2010 Methods </li></ul><ul><li>Key Findings on DAH </li></ul><ul><li>Recipient Government Responses </li></ul><ul><li>What is Coming in 2011? </li></ul>
    23. 23. Understanding DAH Trends <ul><li>Private investment in DAH likely to follow more closely economic cycle and asset prices. DAH from private sources should increase again in 2011. </li></ul><ul><li>Public investment in DAH will be determined by three factors: </li></ul><ul><ul><li>timing of fiscal contraction in order to reduce debt/GDP ratios, IMF estimates maximum contraction around 2013 </li></ul></ul><ul><ul><li>priority attached to development assistance during fiscal contraction </li></ul></ul><ul><ul><li>priority assigned to global health within development assistance </li></ul></ul>
    24. 24. Potential Good News for DAH….. <ul><li>UK austerity budget includes expanded investments in development assistance. </li></ul><ul><li>GFATM replenishment at $11.7 billion for 2011-2013 was lower than projected needs but represents continued growth compared to 2008-2010 replenishment. </li></ul><ul><li>IDA Round 16 replenishment at the World Bank of $49.3 billion, a nearly 18% increase over the previous round. </li></ul>
    25. 25. Not So Good News for DAH….. <ul><li>Comparing 2006-2008 and 2008-2010, already evidence of declining or flat rates of growth for many donors. </li></ul><ul><li>USG 2011 global health disbursements very unlikely to expand compared to 2010 and may well be lower. </li></ul><ul><li>Rapid freezing of Global Fund contributions by Germany, Sweden, and Ireland in response to recent media on corruption in a small number of GFATM grantees. </li></ul>
    26. 26. Implications of a Global Health Recession <ul><li>It appears likely that after nearly 20 years of year on year growth, DAH will decline in 2011. </li></ul><ul><li>Effect on recipient countries will still be in percentage terms small but some programs in some countries may see immediate impacts. </li></ul><ul><li>Effect on the donors, multilateral institutions, NGOs, and universities involved in global health will more far-reaching. </li></ul>
    27. 27. Implications for Sustaining Broad Support for the Global Health Endeavour <ul><li>Urgent need to provide immediate and satisfactory responses to questions on financial transactions for all global health organizations to restore public confidence. </li></ul><ul><li>Strong demand for evidence that the expected benefits from global health investments have actually been realized. </li></ul><ul><li>Well conducted ex post evaluations of investments will add to our scientific understanding of what works and what does not. </li></ul><ul><li>BUT, we need in 2011 more convincing evidence on what has likely been achieved with the $181 billion spent on global health in the last decade. </li></ul>
    28. 28. Pressure for “More Health for the Money” <ul><li>Continued expanded needs for global health programs: rising numbers needing ART, enhanced priorities for maternal, newborn and child health, new political attention for NCDs. </li></ul><ul><li>Expect a renewed focus on how to deliver programs more efficiently – e.g. understand why the cost per person completing a year of ART likely varies 10 fold across sites. </li></ul><ul><li>Shared learning about efficiency of service delivery, however, requires transparency on cost and outcome. </li></ul>
    29. 29. Implications for Global Health Actors <ul><li>Intensified competition between different health programs especially MNCH and HIV/AIDS. </li></ul><ul><li>Increased attention to improving health through multi-sectoral action: World Bank and UNICEF likely to be important in this arena. </li></ul><ul><li>Potential for a sea-change on campuses in perception of global health as the social issue for this generation. </li></ul><ul><li>This trend needs to be counter-balanced by reinforcing the global health triad of: moral imperative, effective technologies and demonstrated successes. </li></ul>