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Cost-Effectiveness Analysis of RBF in Zimbabwe and Zambia

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Profs. Shepard and Zeng have been leading projects for the Bank to develop methods for performing a cost-effectiveness analysis of Results-Based Financing (RBF) programs and applying them to maternal-child health (MCH) services in Zambia and Zimbabwe. Both countries’ RBF programs proved highly cost-effective. Methods and results should be informative to other RBF and MCH programs.

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Cost-Effectiveness Analysis of RBF in Zimbabwe and Zambia

  1. 1. Cost-Effectiveness Analysis of Results-Based Financing in Zimbabwe and Zambia Donald S Shepard, PhD Wu Zeng, MD, PhD Brandeis University, Waltham, MA Nov 3, 2016, World Bank Headquarters, Washington, DC
  2. 2. Schema for cost-effectiveness analysis (CEA) for RBF programs Cost Effects on coverage Effects on quality Administrator’s cost Other donors’ cost Provider’s cost (User’s cost) Household survey Facility survey HMIS data Quality score card Incremental cost Incremental lives saved, DALYs or QALYs Incremental cost-effectiveness ratio (ICER) Inputs Intermediate results Component outcomes Cost-effectiveness outcomes
  3. 3.  Costs  Financial costs  Government and donor perspective  Effectiveness—coverage  Impact evaluation with districts compared  Lives Saved Tool (LiST) software  Literature and country data  Effectiveness--quality  Facility surveys  Exit interviews  Expert opinion (Delphi panel) Toolkit Web: http://documents.worldbank.org/curated/ en/2015/09/25069701/cost- effectiveness-analysis-results-based- financing-programs-toolkit
  4. 4. Evaluate cost-effectiveness by the ICER, the price of one unit of good health. The lower the better! Incremental cost-effectiveness ratio (ICER) 𝐼𝐶𝐸𝑅 = 𝐷𝑖𝑓𝑓𝑒𝑟𝑒𝑛𝑐𝑒 𝑖𝑛 𝑐𝑜𝑠𝑡𝑠 𝐷𝑖𝑓𝑓𝑒𝑟𝑒𝑛𝑐𝑒 𝑖𝑛 ℎ𝑒𝑎𝑙𝑡ℎ 𝑜𝑢𝑡𝑐𝑜𝑚𝑒𝑠 Numerator: Added costs of RBF (difference in costs between RBF and control districts) Denominator: Added effectiveness or health outcomes (difference in health outcomes between RBF and controls), often expressed as quality-adjusted life years, QALYs Both quantity (coverage) and quality contribute
  5. 5. CEA of RBF in Zimbabwe
  6. 6. Annual operating costs of RBF program $2.04 $0.41 $0.20 $0.12 $0.11 $0.09 $0.09 $0.04 $3.09 $2.04 $0.41 $0.10 $0.06 $0.05 $0.09 $0.04 $0.02 $2.82 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 RBF subsidy payments, $7,045,211 Staff costs, $1,434,096 General administration*, $699,311 Capacity building (meetings, workshops, training)*, $426,644 HQ support costs*, $372,845 Transport costs, $299,412 Capital items for Cordaid*, $298,745 Supplies / equipment for facilities*, $128,209 Total, $10,704,473 Per capita annual operating cost Current per capita costs Mature per capita costs The number after each category on the left is the current aggregate annual cost for the intervention districts (population 3.46 million). For categories marked with asterisks, half of the current costs were considered start-up expenses and would be reduced in a mature program. The labels on the right are per capita costs
  7. 7. Aggregate costs from Nat Pharm (US$)* Group Pre-period (Jan 2011- Mar 2012) Post-period (Apr 2012- Jun 2014) Spending /year (Pre) Spending/ year (Post) Net difference Popu- lation Spending /capita Control 6,771,163 33,466,940 5,416,930 14,874,196 2,229,897 $6.67 Intervention 6,062,025 29,478,515 4,849,620 13,101,562 3,461,010 $3.79 Adjusted Intervention 13,316,434 -1.63% 3,461,010 $3.85 Difference $0.06 *Source: Nat Pharm data base of drugs distributed representing 92,000 orders to 354 control and 359 intervention customers. Due to the substantial change in expenditure per year, we computed the difference in differences based on the ratios of aggregate expenditure. We calculated the pre-period ratio of intervention to control (0.8953). We computed the “adjusted intervention” by applying this ratio to the control spending/year (post), and computed the net difference by comparing actual and adjusted intervention values.
  8. 8. Financial net costs of current RBF per capita per year (USD) Cost components Cost Subtotal Incremental RBF operational costs $3.09 Incremental costs at World Bank headquarters $0.10 Subtotal $3.19 Net costs of consumables from Nat Pharm -$0.06 Less Health Transition Fund payments to control districts (no administrative costs included) -$0.81 Subtotal -$0.87 Net cost $2.32
  9. 9.  Quantity of care  Institutional delivery: 13.4%  Postpartum care: 13.3%  Quality of care Impact of RBF in quantity and quality of services Quality indicator Baseline Endline DIDs P- value Relative DIDsRBF Con- trol RBF Con -trol Vaccination 0.87 0.89 0.87 0.83 0.06** 0.009 6.90% Institutional Delivery 0.73 0.75 0.75 0.68 0.10*** 0.001 12.90% Ante-natal care 0.72 0.75 0.79 0.72 0.10*** 0.000 13.70% Post-natal care 0.71 0.77 0.75 0.65 0.15*** 0.000 20.00% Note: DID denotes difference-in-differences.
  10. 10.  Calculated lives and QALYs saved for selected services with RBF and projected from controls:  Quantitative results  Annual number of lives saved is 772, i.e., (72+1,471)/2,  Equivalent to 18,288 QALYs gained  With population of 3.46 million in RBF districts, RBF generates 528 QALYs/100,000 population/year  Site visits suggested coaching strengthened RBF Effectiveness (RBF vs. control): quality & quantity Year RBF Control Lives saved 2012 9,705 9,705 0 2013 8,613 9,345 732 2014 8,136 8,875 739 Total 26,454 27,925 1471 Deaths in children under five and lives saved Year RBF Control Lives saved 2012 416 416 0 2013 370 414 44 2014 365 393 28 Total 1,151 1,223 72 Maternal deaths and lives saved
  11. 11. Contributions of quality and quantity Quantity (Coverage improvem ent), 66% Quality improvement, 34% Relative shares of quality and quantity 350 178 528 0 100 200 300 400 500 600 Quantity (Coverage improvement) Quality improvement Overall (effective coverage improvement) QALYsgainedper100,000populationper year Projected health impacts
  12. 12. Incremental per capita costs: US $2.32 QALY impacts (per 100,000 population per year) Quantity (coverage) alone: 350 QALYs Quality and quantity (effective coverage): 528 QALYs ICERs ($/QALY gained) Quantity (coverage) impacts alone: $2.32/0.00350 = $663 Combined coverage and quality impacts: $2.32/0.00528 = $439 Cost-effectiveness results: RBF vs. control
  13. 13. CEA of RBF in Zambia
  14. 14. Study design
  15. 15. Incentivized services (indicators) and unit prices No Indicator Unit Price US$ 1 Curative consultation 0·20 2 Institutional delivery by skilled birth attendant 6·40 3 Antenatal care (ANC) - prenatal and follow up visits 1·60 4 Postnatal care visit (PNC) 3·30 5 Full immunization of children under one year 2·30 6 Pregnant women receiving 3 doses of malaria intermittent preventive treatment (IPTp) 1·60 7 Family planning (FP) users of modern contraceptive methods 0·60 8 Pregnant women counselled and tested for HIV 1·80 9 HIV+ pregnant women given niverapine (NVP) and zidovudine (AZT) 2·00
  16. 16. Results RBF vs INP RBF vs CON INP vs CON HQ costs 0.22 0.33 0.10 Program costs 5.90 8.65 2.75 MSL costs 0.57 0.97 0.40 0.00 2.00 4.00 6.00 8.00 10.00 12.00 Incrementalcostpercapita($) HQ costs Program costs MSL costs
  17. 17. Program costs (RBF + input financing) and distribution of incentives Curative consultations 30.0% Institutional deliveries 14.0%ANC 1.4%PNC 6.6% Full vaccination 6.3% Third dose of IPTp 3.7% Modern FP methods 28.5% Pregnant women counselled and tested for HIV 9.3% Pregnant women given NVP and AZT 0.2% Incentive payment 51.4% Consultancy costs 16.3% Trainings 6.9% Meetings/ Workshops 2.2% M&E 0.9% Operational costs 7.6% Equipment 14.6%
  18. 18. Coverage and quality of key maternal and child health services at baseline and endline Services Baseline Endline DIDs RBF INP CON RBF INP CON RBF vs INP RBF vs CON INP vs CON Coverage of key maternal and child services Ins Del 68·3% 56·4% 70·9% 80·8% 74·3% 71·2% -5·4% 12·2%** 17·6%*** ANC 97·5% 96·2% 96·3% 98·9% 99·0% 99·1% -1·4% -1·4% 0·0% PNC 70·3% 56·0% 76·4% 82·4% 73·8% 80·7% -5·7% 7·8%* 13·5%*** BCG 95·6% 97·8% 97·6% 100·0% 99·5% 95·6% 2·7% 6·4%* 3·7%* DPT 97·1% 95·2% 95·8% 98·6% 97·6% 91·8% -0·9% 5·5%* 6·4%* HIB 82·5% 88·3% 81·8% 97·9% 88·7% 78·1% 15·0%*** 19·1%*** 4·1% IPT 92·0% 92·4% 95·1% 98·0% 96·1% 98·1% 2·3% 3·0%** 0·7% FP∆ 6·5% 9·9% 7·7% 34·0% 15·6% 15·7% 21·8%** 19·5%** -2·3% Quality index of key maternal and child services Ins Del 65·5% 66·8% 67·0% 73·5% 74·1% 71·9% 0·7% 3·1% 2·4% ANC 66·9% 69·1% 68·6% 75·0% 77·2% 73·8% 0·0% 2·9% 2·8% PNC 66·7% 68·4% 68·3% 74·1% 76·6% 73·4% -0·8% 2·3% 3·0% Vaccination 78·7% 80·7% 81·7% 81·2% 80·0% 80·4% 3·2% 3·8% 0·6% FP 77·7% 78·6% 80·6% 81·6% 77·6% 74·8% 4·9% 9·7% 4·8%
  19. 19. QALYs gained from the RBF program in comparison with controls RBF vs INP RBF vs CON INP vs CON Mid-point (lower bound-upper bound) Mid-point (lower bound-upper bound) Mid-point (lower bound-upper bound) Population QALYs gained (unadjusted for quality) QALYs gained (adjusted for quality) QALYs gained (unadjusted for quality) QALYs gained (adjusted for quality) QALYs gained (unadjusted for quality) QALYs gained (adjusted for quality) Pregnant women 237 (216-302) 302 (237-345) 475(425-539) 604(539-626) 237(176-302) 302(237-345) Children under 5 5 088(3 733-6 015) 6 300(4 826-7 323) 11 816(10 480-13 100) 14 574(13 195-15 953) 6728(5 171-8 131) 8 274(6 704-9 843) Total 5 325 (3 948-6 317) 6 602(5 064-7 688) 12 291(10 905-13 639) 15 178(13 734-16 579) 6 966(5 347-8 433) 8 576(6 942-10 188)
  20. 20. Incremental cost-effectiveness ratios Comparison Cost/life saved (US$) Cost/QALY gained (US$) Mid-point (lower bound- upper bound) Mid-point (lower bound-upper bound) RBF vs INP (unadjusted) 39 621 (33 388 - 53 381) 1 674 (1 411 - 2 258) RBF vs INP (quality adjusted) 31 952 (27 514 - 41 657) 1 350 (1 163 - 1 761) RBF vs CON (unadjusted) 25 553 (23 024 - 28 767) 1 079 (972 - 1 216) RBF vs CON (quality adjusted) 20 689 (18 945 - 22 865) 874 (800 - 966) INP vs CON (unadjusted) 14 786 (12 211 - 19 235) 624 (515 - 813) INP vs CON (quality adjusted) 12 280 (10 110 - 14 837) 507 (427 - 626)
  21. 21. Discussion
  22. 22. Reference: Zimbabwe’s 2012 GDP/capita was $980 If ICER < GDP/capita, program highly cost-effective (WHO) ICER of current RBF Improved coverage alone: $663 or 0.68x GDP/capita, highly cost- effective Including quality gains: $439 or 0.45x GDP/capita, highly cost- effective Mature RBF program would lower cost by 9.0% to $2.11 per capita Discussion: Interpretation of RBF in Zimbabwe
  23. 23. Calculated average is 528 DALYs vs. mature program (704) Potential increase for mature program: 33% Discussion: program maturity (Zimbabwe as an example)704 528 0 DALYs per100 population per year Phase I periodPhase I period Phase I period Calculated averageEstimated phase in Mature program
  24. 24. Projected cost per capita $2.11 Projected impact is 704 QALYs per 100,000 population per year Projected ICER is $300 i.e. $2.11 / (704 / 100,000) or 0.31 x GDP/capita Projected ICER of mature RBF program
  25. 25. Reference: GDP/capita $1,759 (2013) ICER of RBF  Compared to Input-financing: $1,350 or 0.77 GDP/capita, highly cost-effective  Compared to pure control: $874 or 0.50 GDP/capita, highly cost-effective ICER of input financing  Compared to pure control: $507 or 0.29 GDP/capita, highly cost-effective Comparison with Zambia RBF
  26. 26. Reproductive health vouchers in Uganda (African Strategies for Health, 2015) $302 / QALY or 0.59 x GDP/capita ($510) Simulated maternal community-based health insurance in Uganda (African Strategies for Health, 2015) $298 / QALY or 0.58 x GDP/capita ($510) RBF is among the very highly cost-effective interventions Comparison with other maternal-child health programs
  27. 27. 1. Use both penalties and rewards Human nature: people work hard to avoid penalties 2. Establish a threshold and pay only for activities above it e.g. antenatal care: pay only for incremental coverage over 90% 3. Pay for improvements over last year’s average as well as attainment e.g. Last year’s average 4; this quarter 5; improvement 1 4. Pay a fixed dollar amount for remoteness Current incentives as % of volume are too small 5. Combine RBF with more formative supervision and demand side Helps providers learn to improve quantity and quality Potential refinements to RBF
  28. 28. Ministry of Finance, Zimbabwe Ministry of Health and Child Care, Zimbabwe World Bank, Zimbabwe Cordaid, Zimbabwe Acknowledgments Ministry of Health, Zambia World Bank, Zambia World Bank Headquarters Financial support  World Bank Health Results Innovation Trust Fund
  29. 29. Donald S Shepard, PhD shepard@brandeis.edu +1 781 736 3975 www.brandeis.edu/~shepard Contacts Wu Zeng, MD, PhD wuzengcn@brandeis.edu +1 781 736 3888 www.brandeis.edu

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