Over the past 25 years, AIDS has imposed a huge cost, in economic and social terms, on many countries, communities, and households around the world. At the same time, the price tag to respond fully and effectively in the areas of prevention, care and treatment, mitigation, and research has grown to tens of billions of dollars, and is continuing to increase. There have been dramatic increases in funding, but available resources are now becoming increasingly tight as the global recession adversely impacts both donor and developing countries, and as other competing priorities (e.g. climate change, swine flu) emerge.

In this context, there is an urgent need for better and long-term estimates of the cost and financing trajectories for the AIDS pandemic, and a fresh perspectives on possible policy actions that could improve things in the coming decades.

To respond to this need, aids2031 was established in 2008 as a high level international consortium of partners, bringing together multi–disciplinary teams to question conventional wisdom, uncover new evidence, and encourage debate and action.

Results for Development Institute was asked to host and coordinate the aids2031Costs and Financing Working Group, composed of senior officials from governments, civil society, the private sector, and academic institutions from Africa, Asia, and Latin America, and developed countries. The Working Group has focused on modeling and analyzing the long-term costs and financing of the AIDS epidemic, and examined scenarios in which major policy shifts now can better contain future spending, improve efficiency, and mobilize adequate, fair, and sustainable resources.

Cost Projections

Our findings show that if we continue on our current trajectory we will spend twice as much in 2031, but there will be little to no reduction in new infections. In effect we will have a stalemate, where AIDS will continue to need more money and we will have more people becoming infected.

Our cost projections show that the price tag in 2031 could be as high as $8000 dollars per HIV infection averted, but if we make hard choices and put an emphasis on scaling up cost effective interventions we can bring this down to $1400 dollars per infection averted.

By concentrating on expanded, smarter, more focused prevention interventions such as programs for most at-risk populations (commercial sex workers, injecting drug users) and male circumcision in East and Southern Africa, we can dramatically reduce the number of new infections. Efficiency gains in delivery of treatment services and costs of drugs can also reduce costs and improve program impact. Social and structural changes to further reduce the number of sexual partners and increase condom use, and technological “game changers” such as a vaccine will be needed to drive the number of new infections much lower.

Resource Mobilization

Over the long run, many middle income countries, especially those in Asia and Latin America with concentrated epidemics, should be able to afford to pay for their own AIDS programs and could transition away from outside funding over the coming decade. This would free up significant resources that can be directed to high prevalence low income countries, such as Zambia, Mozambique, and Malawi, where future AIDS spending could consume 2-4% of GDP. These countries can be expected to depend on donor support to finance their AIDS programs, in return for more intensified efforts in prevention.

Other sources of financing for AIDS could include innovative mechanisms such as the airline tax which is currently generating resources via UNITAID, and philanthropy in emerging economies such as India and China.

These and other findings of the Working Group were published in the October/November issue of Health Affairs.

Country Case Studies

To complement these global analyses, the aids2031Costs and Financing Working Group is supporting case studies in South Africa and Cambodia. The governments of both countries have played a leading role in shaping and carrying out the studies, which are designed to generate data and analysis to help national policy-makers in identifying policy options to use resources more efficiently, contain long-term expenditures and implement sustainable financing strategies. The case studies are also an opportunity to validate and refine the aids2031 costing, priority-setting and financial mobilization tools, so that these can then be made available for use in other countries. National workshops are being held in Cambodia in late November and in South Africa in December 2009. Results from the country studies are expected to be available in early 2010.