Calculating indirect costs from international PEPFAR implementing partners.

Brian Honermann,Topher Hoffmann,Laura Lazar,Jennifer Sherwood,Austin Jones,Alana Sharp,Richael O’Hagan,Pratima Kshetry,Greg Millett,Christina Chandra,Eduard J Beck

doi:10.1371/journal.pone.0206425

Abstract

BackgroundUNAIDS estimates global HIV investment needs in low- and middle-income countries (LMICs) at $26 billion per year in 2020. Yet international financing for HIV programs has stagnated amidst despite the increasing number of people requiring and accessing treatment. Despite increased efficiencies in HIV service delivery, evaluating programs for greater efficiencies remains necessary. 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. This analysis presents a method for estimating indirect costs in the President’s Emergency Plan for AIDS Relief (PEPFAR).MethodsUtilizing PEPFAR country operational plan (COP) funding data from 2007 to 2016 for international organizations (IOs) and universities and standard regulatory cost bases, we calculated modified total direct costs on which indirect cost rates may be applied by partner and funding agency. We then apply a series of plausible indirect cost rates (10%–36.28%) to develop a range for total indirect costs that have accrued over the period.FindingsOf $37.01 billion in total COP funding between 2007 and 2016, $22.24 billion (60.08%) was identifiably allocated to IOs ($17.95B) and universities ($4.29B). After excluding funding for sub-awards ($1.92B) and other expenses ($3.89B) to which indirect rates cannot be applied, $16.44B remained in combined direct and indirect costs. From this, we estimate that between $1.85B (8.30% of total international partner funding) and $4.34B (19.51%) has been spent on indirect costs from 2007–2016, including $157-$369 million in 2016.InterpretationTo our knowledge, this is the first analysis to quantify the indirect costs of major implementing partners of a global HIV funder. However, lack of transparency in the indirect cost rates of non-University international partners creates an opaque layer of programmatic costs. 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.

Highlights

The UNAIDS Fast Track agenda and 90-90-90 targets have galvanized the world to re-focus on the essential priorities for combating HIV globally
UNAIDS estimates that achieving the 90-90-90 goals will require an annual commitment of $26.2 billion for the epidemic in lowand middle-income countries, up from $19.2 billion in 2014.[1] international donor funding for HIV programs in low- and middle-income countries (LMIC) has declined for two consecutive years.[2]
Combined U.S contributions to the U.S President’s Emergency Plan for AIDS Relief (PEPFAR) and the Global Fund have been essentially flat since 2009 and continue to be threatened with budget cuts by the U.S government.[3]. These resource constraints coincide with welcomed increases in life-expectancy of people living with HIV (PLHIV) as more people receive treatment and implementation of test and treat for individuals being newly identified.[4]

Summary

Introduction

The UNAIDS Fast Track agenda and 90-90-90 targets have galvanized the world to re-focus on the essential priorities for combating HIV globally. UNAIDS estimates that achieving the 90-90-90 goals will require an annual commitment of $26.2 billion for the epidemic in lowand middle-income countries, up from $19.2 billion in 2014.[1] international donor funding for HIV programs in low- and middle-income countries (LMIC) has declined for two consecutive years.[2] Combined U.S contributions to the U.S President’s Emergency Plan for AIDS Relief (PEPFAR) and the Global Fund have been essentially flat since 2009 and continue to be threatened with budget cuts by the U.S government.[3] These resource constraints coincide with welcomed increases in life-expectancy of people living with HIV (PLHIV) as more people receive treatment and implementation of test and treat for individuals being newly identified.[4].

Results

Discussion

Conclusion