Billions in AIDS Relief Spent on Indirect Costs Over a Decade

November 21, 2018

Between 2007 and 2016, indirect costs may have accounted for more than $4 billion in international partner funding in the President’s Emergency Plan for AIDS Relief (PEPFAR), according to estimates published in PLOS One.

“Despite increased efficiencies in human immunodeficiency virus (HIV) service delivery, evaluating programs for greater efficiencies remains necessary,” researchers wrote. “While HIV budgets have been under scrutiny in recent years, indirect costs have not been quantified for any major global HIV program, but may constitute an additional avenue to identify program efficiencies.”

Of $37.01 billion in total PEPFAR country operational plan funding between 2007 and 2016, $22.24 billion, or 60.08%, was allocated to international organizations and universities. Researchers then subtracted $1.92 billion that went toward sub-awards and $3.89 billion to other expenses and arrived at $16.44 billion in combined and indirect costs.

Of that amount, between $1.85 billion and $4.24 billion—or between 8.3% and 19.51% of international partner funding—was spent on indirect costs, researchers estimated. In 2016 alone, indirect costs accounted for an estimated $157 million to $369 million in spending.

“To our knowledge, this is the first analysis to quantify the indirect costs of major implementing partners of a global HIV funder,” researchers wrote. “Given the current funding environment and evolution of HIV programming in PEPFAR countries, the findings motivate a re-examination of the current policies and the return on investment in indirect cost recovery across the PEPFAR program.”

Jolynn Tumolo

For articles by First Report Managed Care, click here

To view the First Report Managed Care print issue, click here